TV Advertising Versus Social and Search

Because the nature of startups is fundamentally about establishing new truths, one of my favorite cultural quotes from my various startup lives is from German philosopher Arthur Schopenhauer:  “All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

This truism has applied to the advertising world over many decades as new technologies or ad channels have evolved. For example, in the early days of paid search, the very idea of incorporating paid advertising in what was then considered editorial search results was universally ridiculed and opposed – especially by big search “portals.” Today, however, the value of the paid search category is accepted as being self-evident, and generates over $100B+ a year in global ad revenue. Likewise, social media had a hard time getting advertisers to buy into marketing to “friend networks” in the early days.  

Today’s marketers confront a question that has tortured advertisers since the dawn of TV in the 1950s: Is TV an effective medium to drive consumer response? Like all science, our ability to answer this question is directly related to available observation and measurement technologies (for example, our ancestors thought the world was flat before they developed the observation technologies to prove otherwise). And let’s face it — despite TV’s obvious power to both reach and influence massive audiences, the medium has been plagued by awful observation and measurement tools ever since the 1950s.  

Is TV Advertising Really More Powerful?

Even as we assert that TV ads do in fact generate higher recall and consumer response rates than Facebook or Google ads, there has been widespread disbelief, ridicule, and opposition.  Why? Because A) we haven’t had the tools available to prove otherwise, and B) as the entrenched and dominant marketing platforms of today, the players who dominate search and social have trained (brainwashed?) us to view the ad world on their terms – through reach, digital targeting, and simplistic “last-click” attribution. What’s missing from this narrative is the all-important form factor of the ad itself.  

A social media ad is about two inches wide, and the message delivered in that miniscule space is sandwiched between a stream of endless (and mostly mindless) content that is literally programmed algorithmically by scores of data engineers to distract consumers. Conversely, TV ads are delivered to consumers in a clutter-free environment, where the consumer is usually in a “leaned back,” focused state of being. TV ads are often delivered via 60″+ TV screens with full surround-sound audio, creating an immersive “sight, sound, motion” impact like no other medium. Of course TV drives better recall! And if TV ads drive better recall, basic logic would conclude that TV ads also drive better consumer response (more on that in a minute).    

In a recent survey of 1,000 consumers, we discovered that 46 percent of people say TV and streaming ads are the most memorable, compared to 33 percent brand recall for social media ads and just nine percent for website ads. What’s amazing to me is that this “new” discovery is surprising at all. Think about the ability of TV ads to drive recall. Just a few examples include the famous Wendy’s “Where’s the Beef” commercial, or Pepsi’s “Be Like Mike” campaigns. The Nine Lives cat food ads featuring Morris the Cat ads generate a 90% recall rate a full 40 years after their last TV ad ran.  

Can you recall the last Facebook ad you noticed? Or any Facebook ad ever? I can’t.   

TV advertising versus Social and Search: The Attribution Question

But what about the “last-click” attribution models that come from Google and Facebook, who appear to want to take full credit for an action that comes from their advertisements, disregarding the impact that any previous ad might have had? If a consumer takes action from a Google or Facebook ad, does that mean the ad was solely responsible for connecting the advertiser with the consumer, even though the consumer might have seen the product advertised on TV or in other places? Hardly.

We shouldn’t hand credit to Google or Facebook for originating a click that was inspired from a TV ad or other channels — they were just the “last mile” delivery mechanism since people can’t click on TVs. Fortunately, we now have some science to back this up.

As the TV industry has retooled around internet-connected TVs (CTVs), an entirely new set of data is now available, showing that people who are exposed to CTV ads not only have higher recall rates than people on social and search, but they also respond to those ads using a “second screen” like a laptop, tablet, or smartphone. This means as an industry, we can now “deterministically” show the consumer journey from TV ad exposure to consumer action, where an action is a website visit, purchase, app install, or other actions. We can also access sophisticated data to help understand the complete consumer journey, including time decay and frequency analysis to help advertisers prove — once and for all— what we have all intuitively believed since the 1950s. TV ads really do work — perhaps way better than we ever realized.  

So let’s get to the self-evident phase of truth here. TV is the most impactful, important screen in our lives, and it is the most powerful advertising medium the world has ever known. The problem has been that we haven’t been able to measure it with digital-like precision. Until now.

Jason Fairchild is co-founder and CEO of tvScientific.