Entering the New Age of Advertising: It’s time to invest in relationships

Television drastically changed the advertising industry in the 1950s.

But there was no way to see or control the TV ad performance. Advertisers poured thousands of dollars into campaigns — and then just hoped that eventually, their message would reach the right audience.

This spray-and-pray approach worked but there was a lot of room for improvement. And this improvement happened during the last few decades.

First, it was the arrival of video-first social media, then connected TV, and now — have you heard the news? — it looks like the TV and social media worlds are finally coming together.

But what does it mean for brands and advertisers?

The endless sea of social media advertising tools

The coming of YouTube marked a new era in video advertising and made brands re-think their channels and their effectiveness.

Today, social media, influencer marketing, and streaming services represent around 50% of total spending on TV commercials. And it’s not surprising: in December 2020, more than 120 million people in the U.S. alone streamed YouTube or YouTube TV on their TV screens.

Although traditional TV is still dominating the advertising world, the landscape is steadily shifting towards digital platforms. And there’s a reason for this.

Social media campaigns help advertisers drill down into various metrics, set up super-specific targets, and track them as closely as they want. Besides, the variety of advertising tools on major social media platforms is growing rapidly every year.

Ok, so it means that social media is the future of advertising, right?

Well, yes, but hold on a second.

Connected TV advertising is another powerful tool

To put it simply, a Connected TV (CTV) is a device that is connected to the internet and that supports video content streaming. For example, Roku and Apple TV are among the well-known ones. And CTV is not going anywhere. Sales of smart TVs account for 79% of all flat-panel TVs sold in 2020.

Although CTV is often used interchangeably with over-the-top (OTT) services, these two terms have different meanings. While CTV refers to a device, OTT is a service (content) that is streamed via the internet. For example, Netflix and Hulu are OTT platforms.

And it’s not only CTV that has taken the world by storm: the OTT market is expected to grow at 19.1% annually and generate a revenue of $438.5 billion by 2026.

Similar to social media, TV connected to the internet has opened more doors to performance marketing and the programmatic approach. Combining TV with digital advertising tools allowed a seamless advertising experience.

For example, advertisers can now build more precise customer profiles and better understand who the viewers are, what they are watching, where and when. It has become easier to customize ads to different audiences and ensure that viewers see content that is relevant to them.

Merging TV and social media

Social media and CTV advertising replaced the spray-and-pray technique with a data-driven approach. It looks like advertisers have two effective performance marketing channels now. Sounds exciting, right?

But it’s not that simple.

According to a 2019 study, 94% of Americans kept a mobile phone by their side when watching TV. Although viewers are abandoning traditional TV in favor of smart TVs, they’re still not ready to let go of their smartphones.

The question is: why not bring mobile phone experience directly to TV screens?

This is what TikTok did last year when they introduced a TikTok app for smart TVs.

The thing with TikToks is that these videos are often so entertaining that you want to share them and watch them together with friends or family. Just like you would watch a movie or a TV series. As Rich Waterworth, Managing Director, UK and Europe at TikTok, puts it: “There’s a very harmonious relationship between TV and TikTok.”

There sure is. But it doesn’t stop there.

Bringing TikToks to TV screens will allow TikTok creators to reach a wider audience. And this, in turn, will make influencer marketing even more attractive than it is now.

Everyone can access TikTok advertising tools and create engaging ads. But can these tools be your competitive advantage? I doubt this. Meaningful relationships with creators can.

Conclusion

A while ago, we were excited to have an option to watch films on our mobile phones. Now, it looks like social media has outgrown the small screens.

It’s still one of the main advertising channels with a variety of new tools being released every month. But maybe it’s time to invest in human relationships?

After all, the creator economy is here to stay. And winning at competition requires thinking ahead.