Tuesday morning, ILM East kicked off before the sun rose, with coffee and klatching about broadcasters and online. After some introductory remarks, BIA/Kelsey VP Rick Ducey turned over the podium to his colleague, VP Mark Fratrik. Fratrik gave a recap of the latest BIA/Kelsey ad spend forecast by media, and then provided more focused forecast data on broadcast and online spending. A key take-away: BIA/Kelsey is forecasting CAGRs for digital media in the mid-teens, for next few years.
Ducey then pointed out that a handful of broadcasters are ahead of their peers, to such an extent that they actually drive the numbers for the whole category (online revenues generated by broadcasters). Two of these exemplar broadcasters then spoke:
• Randa Minkarah, SVP of business development at Fisher Communications, based in Seattle. Fisher has 20 TV station, and has launched 121 hyperlocal websites.
• Belinda Baldwin, Director of audience development, Belo Corp., based in Dallas. Belo has 20 TV stations and more than 30 web sites (and of course is affiliated with the publishing giant of the same name).
When it comes to online, Minkarah advised broadcasters to focus on what is unique to their broadcasting culture – to focus on what they already do well. For example, most stations already have excellent traction with their local news programming. This provides a solid platform for expanding programming (and advertising) online.
Baldwin opined that the next round of growth in broadcasters’ online revenues will come from greater operational efficiency: from pricing and selling more skillfully. She went on to acknowledge that online search products haven’t been particularly successful for broadcasters, and the reasons probably have to do with sales skills and abilities, etc. – that products and pricing weren’t being matched appropriately to advertiser needs. “Slow down on the product proliferation, and focus on the execution” she advised the audience.
The conversation then turned to “over the top video”. No, this is not about the latest Charlie Sheen rant on YouTube. Rather, it is “demand” video, in which consumers seek out video programming they want and pull it down from an Internet source. As opposed to say the customary “over the air” mode, of watching whatever programming the good networks send your way.
Baldwin said she believes “over the top video” is something that broadcasters can get in front of. It’s an opportunity to innovate, and also happens to be a particular vulnerability of the cable companies. She acknowledged that this modality is still in an early stage, but that the tipping point is probably in a 5-10 year horizon.
Finally, the speakers and audience members all commented on the importance of social media in the advertising mix, and that broadcasters may be behind the curve so far. The point was made that social media needs to be coordinated with other hyperlocal efforts.