5 Uncomfortable Facts for the Digital Maniacs
Everything is changing! Nobody watches TV or uses e-mail, advertisers are racing to shift money into digital media as fast as possible and those fat cats who are too lazy to change will all soon be toast.
These things all must be true, because you can read them on the Internet. You can either accept it or…check the facts.
The amount of crap that’s regularly spewed around never fails to amaze me. Self-styled gurus often relish in mouthing off without the first clue about what they’re talking about. Here are some facts, like ‘em or not!
Digital Makes Up a Small Share of Total Media Spend
“Well, as we all know, everybody is moving their ad budgets to digital…”
Okay, now this drives me into a murderous rage (although, I must admit, I’m pretty excitable anyway). It’s not that I have anything against digital media, It’s just that I’ve been much more involved with it than most of the idiots who blather on about this stuff.
I’ve run fairly large digital media operations in the past and can assure you that convincing an advertiser to move their budget into digital is anything but easy (although they love to see cool digital presentations).
Moreover, my current employer, ZenithOptimedia, tracks media spending trends in every ad market in the world, so I have a pretty good idea of what the data looks like.
The truth is this: Digital media accounts for a bit less than 15% of media both globally and in most developed countries. There are some exceptions, like UK and Scandinavia, where the share is in the mid-20’s, but fifteen years into the “digital revolution” the impact of digital media is amazingly small, especially as it encompasses everything from search to video.
Traditional Media is (very) Profitable
Enough fooling around though. In the end, we’re talking about business so eventually the discussion becomes an financial one. Here’s where the digital maniacs become quite serious, explain that it is a matter of “simple economics” and then trot out some wacky historical theory that supports their point.
I’m always a bit puzzled by this because I have always been under the distinct impression that finance has something to do with numbers. As the latest numbers show, traditional media companies are very profitable, even while Facebook struggles to earn money with 500 million users.
But wait – didn’t we hear that they were losing billions? Yes, that is true, but those weren’t operating losses, they were write-offs. The money that big media companies lost was on investments they made, to a large extent in digital media. In effect, media companies lose money when they are dumb enough to listen to hyped up digital gurus.
TV Viewership is Increasing
Why do I constantly hear that nobody watches TV anymore? Because some yo-yo, who just got out of school moved to the big city and is spending all his time chasing girls? I watch TV. I LOVE TV! It raised me, comforts me and talks to me when no one else will (besides, my wife would kill me if I chased girls and I’m too old to catch them anyhow).
Why are people watching TV? The crappy economy surely has something to do with it, but it’s more than that. People aren’t only watching more TV, they’re also buying more of them, especially expensive ones. I guess that’s because there is an ever increasing amount of stuff to watch and bigger and better TV’s to watch it on.
Consumers Don’t Avoid Ads
Another thing I keep hearing is how the ad industry is living on borrowed time because people hate ads. Apparently, they’re fed up and aren’t going to take it anymore! I get visions of a massive crowd running for their life and screaming at the top of their lungs in their quest to avoid a brand impression.
In actuality, there is no evidence at all that people make much of an effort to avoid ads. It’s not that hard. If you want to avoid banners, just download something like this. It’s free! Don’t like TV ads, get a TiVo. However, despite a penetration rate in the mid-30’s, timeshifted viewing on DVR’s makes up only about 6% of the total and even then a lot of people watch the ads.
Ads are like bloggers. Some are annoying, most are average, but some are really good. For instance, I love this one:
And this one is great too!
In any case, I don’t do much to avoid them and neither does anybody else.
Probably the most puzzling view espoused is that advertising is some kind of con game perpetrated on gullible companies. In the common narrative, hard nosed, profit driven companies all of the sudden become witless fools and drop half a trillion dollars a year on advertising for no good reason.
This should be ridiculous on its face, but there are some who go even further. They say that we are entering a new era of “pull marketing” where companies won’t promote themselves anymore, but just wait for consumers to decide that they want their products.
Make no mistake, marketers invest in advertising because its profitable to do so and they continue to do it at a consistent ratio to GDP that doesn’t show any signs of faltering. Most of the money they invest is put toward broadcasting messages because that’s how they let people know what they’re selling.
You Have a Right to Your Opinion – Not Your Own Facts
Usually by this point, digital gurus will assert that they have a right to their opinion. Yet, they never state their views as opinions, but as facts. Furthermore, they position themselves as experts who possess knowledge that others don’t and seek to profit off of that expertise. That’s immoral.
As David Brooks recently pointed out, we all often fall into the trap of not examining the weakness in our thinking enough. That’s natural, facts are often stubborn, inconvenient things. However, if you seek to advise others and cast aspersions, you have a moral obligation to make a reasonable effort to check your facts. If you do not, you are a charlatan – plain and simple.
That is my view and I can assure you it is the correct one.