01.30.2006 11:24 AM
New Media: For Fun or for Profit?
As we wrap up another year and prepare for the next, it’s appropriate to discuss some of the changes taking place in our industry that are being brought about by new technologies, and how they relate to the dollars being spent on advertising.

I’ll tell you what’s on my radar screen: it’s “new media.” Use whatever terminology you want. Call it podcasting, video on demand, streaming video, TiVo’ing or just plain old “all that new stuff.” I cite it not because it’s the topic du jour in every advertising industry print publication; I’m on it because I’m living it. Many a day goes by where my first exposure to “traditional media” doesn’t occur until after 7:00 p.m.—a full 14 hours into my day.

I am an active user of many of the options and formats listed above, and I recognize that my usage of media is still considered by many to be on the leading (or “bleeding”) edge. The vast majority of consumers today do not share my specific media consumption habits, which is a good thing for those of us (and our respective employers) who profit from reaching large audiences via mass media.

Then again, I was the first of my friends to have a VCR...a camcorder...a cellular phone...an email address...an 18-inch satellite TV system...a digital camera...satellite radio...an HDTV monitor...and a smart phone. Looking back, each acquisition was “cutting edge” at the time. Today, all but the last three are commonplace...and they’re growing in popularity, too. Times are changing, and the fact that the average consumer’s media usage habits are shifting and evolving has everyone concerned...and has some taking action.

Satisfying this changing audience, progressive broadcast TV stations have been getting into the New Media business in the past few years. This has happened for three reasons. First, the content that is created on a daily basis by a broadcaster’s news department lends itself quite easily to these new distribution methods.

The second reason? New technologies. Streaming video is clean, and easy to watch. More end-users have high bandwidth connections. Cable carriage deals are being negotiated for multicast digital channels. It’s simply getting easier for TV stations to distribute content, and for consumers to receive and use it.

The third reason, of course, is profit. If advertisers are allocating a portion of their budgets to new media, and those overall budgets are not being increased accordingly, then these dollars must be coming...out of our share, right? In some cases, that assumption is true. Major advertisers, largely on a national basis, are reallocating budgets to include new media. When will this affect regional and local advertisers? Now is a good time to ask that question, don’t you think?

The good news is, these three factors have positioned broadcasters to be more than just a TV station! This transition has occurred relatively quickly. While TV station websites have been around for a decade, the ancillary services being produced and sold are much newer. That begets another issue: Is your station really embracing new media, or is it an afterthought? No one will accept putting forth a paltry news effort at 6 & 11 p.m. in lieu of composing a killer website.

However, it’s clear to me that the resources and dollars being invested on this front vary widely from station to station. Whether you call it new media, or non-traditional revenue, I’ve seen no prediction of it declining. In fact, a recent study by Borrell Associates called for a 161% increase in online ad spending by local advertisers across 211 markets in 2006!

One of the biggest challenges faced by broadcasters, therefore, will be how to position and package their new media opportunities. Here’s why: consumers see TV stations as being providers of news and entertainment. It takes no great leap of faith on their part to accept the fact that local news is now available 24/7 from your station via a variety of sources.

A larger obstacle comes when selling these opportunities. When people have been buying :30 commercials from you for 50 years, it’s not easy to reposition your station as a one-stop shop for :30 spots AND opt-in media AND video on demand AND online advertising...and more. I’ve seen stations put greater effort into planning their fall premiere parties than they do to educate the buying community about new media! At my station, we’ve created a package of new media opportunities, called 10 NOW. It’s a new sales opportunity for the station, custom-designed to tap into the changing demands of our advertising clients.

Furthermore, let’s not confuse “added value” with “free.” Do you think Google and Yahoo are throwing in an extra 50 keywords at no charge on each paid search campaign? If your station is creating new media advertising options in 2006, it’s your job to educate the ad-buying community as to their value. If they don’t listen, then go find someone else to buy them.

Look, television is still the proverbial 800-pound gorilla. This holds true for both audience impact and revenue generation. Want proof? If a loved one were missing, you’d still want that alert issued on the 6p.m. TV news, versus a text listing of that fact on craigslist.com. Same holds true for a grand opening sale. TV spot revenue rules, but new media sales are growing in importance.

New media is media, and we’re in the business of selling it. If you fail to ask your advertisers how they’re using it, and how they’re paying for it, then you deserve less of their money in 2006.

Jeffrey Ulrich is the new business development manager at WHEC, Rochester, NY. His opinions are his own and do not necessarily reflect the position of HBI, Inc. He can be reached through his website, www.hidefjeff.com, or at julrich@news10nbc.com.


Comments
Post New Comment
If you are already a member, or would like to receive email alerts as new comments are
made, please login or register.

Enter the code shown above:

(Note: If you cannot read the numbers in the above
image, reload the page to generate a new one.)

No Comments Found




Thursday 10:05 AM
NAB Requests Expedited Review of Spectrum Auction Lawsuit
“Broadcasters assigned to new channels following the auction could be forced to accept reductions in their coverage area and population served, with no practical remedy.” ~NAB


 
Featured Articles
Research & Standards
Discover TV Technology