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TV Advertising vs Online Video: How Do They Compare?

Jonathan Rolley
Jonathan Rolley Posted on Apr 12, 2016, 6:27:55 AM

Online video is growing at an unprecedented rate, but does that necessarily mean that this digital marketing medium is better than TV advertising? A comparison of these two types of advertising media reveals that things are not as clear-cut as the proponents of each would suggest.

 

a black and white tv screen and someone watching youtube on a handheld device

Does TV Advertising or Online Video deliver greater ROI?

As it stands today, TV advertising has been found in many studies to deliver not only the greatest reach but it also outperforms online marketing when the objective is lead generation or ROI. The impression that TV ads leave on consumers tends be more trusted, lasts longer in the minds of potential customers and, thanks to recent advances in data science, can be just as targeted as digital marketing. Today, TV advertisers have a myriad of channels and programs to choose from, and advancements in DRTV data analytics have made it possible to measure television advertising campaigns in digital metrics. This means that by selecting specific programs, day-parts and creative, you know exactly how many users will respond as a pay per click and can determine the associated ROI from this activity. 

The term, DRTV, stands for Direct Response TV. Marketing agencies use data science to measure the direct impact of DRTV advertising, where if a spot reached an audience of 1 million viewers, we measure how many of these individuals took action in direct response to the TV ads. When comparing the data analytics of TV to video marketing, the cost per thousand (CPM) can be dramatically different.

To illustrate, let's say that our television advertising campaign would cost $15 to reach a thousand people; using video marketing to deliver the same reach of one thousand people could cost up to $80 for the same audience. This would require video marketing to deliver at least 6 times the response rate. In our experience, we not only find that TV has a much lower cost per thousand but that with an optimised media schedule, it can deliver response rates which are over 10 times better than video marketing. 

In today's environment, television advertising is the heavyweight and undisputed king of performance video advertising. However, several demographics are becoming slightly harder to engage... 

Millennials spend more time online

TV is slowly losing the fight with millennials to online marketing. This demographic has received much focus from the general advertising and marketing world, and you'd think that those in TV advertising would be a little more concerned. But they're not, and for good reason. Even though Generation Y spends more time on mobile devices, they don't treat stream ads the same way they do TV ads. When browsing the web, younger consumers are a little more distracted, and there is nearly always the option to click 'skip'. When streaming video is the focus of their attention – for example their favourite series – they are even less likely to click through to a website. For the majority of advertisers in Australia, this does not impact their campaigns, as over 80% of advertising campaigns are designed to appeal to people aged 35 or older. 

People trust TV

People unconsciously accept that if it's on TV, then someone has paid a lot of money to put it there, so it must be of some value. For this reason, 'as seen on TV' has many positive associations for brands. People trust the familiar brands that they know, and the effectiveness of 'as seen on TV' is a testament to TV's ability to build brand awareness. TV also has many cost efficiencies compared with online video and typically delivers much higher response rates. The multi-screen viewing society that we currently live in only enhances TV's experience, as if you see something that is of interest, you can review it online whilst also still consuming video content in the background. 

Integrated campaigns will deliver the best results

While TV ads are clearly delivering a more favourable ROI in dozens of case studies, this doesn't mean that you should discount digital marketing platforms as an integral part of your marketing mix. The effectiveness of digital marketing is always improving, as it becomes easier for web users to constantly transition between both types of advertising media and as marketers learn how to use digital marketing in combination with TV to gain lead generation. Marketers will need to become more adept at using online marketing to both reinforce what someone has seen on TV and to engage those consumers who are at lower points in their sales funnels. 

Summary

It's not a case of television advertising vs online video, but rather a question of how you can best combine these two types of advertising in your overall marketing mix and what percentage of your budget should be allocated to both types of advertising. As a leading performance-based Melbourne advertising agency, we are constantly optimising our clients' marketing strategies to ensure the greatest ROI and lead generation.

If you would like to know more about how online marketing and television advertising could help to dramatically increase your ROI, please find a quick link below and submit your details for a FREE 1 hour consultation.   

CONTACT US

 

Credit Image: PAUWR

Jonathan Rolley
This post was Written by Jonathan Rolley

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