“New Zealanders sitting in front of the telly are not planning on cutting the cord any time soon,” reports Caroline Atford, Nielsen NZ executive director.
“TV broadcasters are custodians of quality content and able to reach the most people.”
Atford is backed by evidence in The New Zealand Multi-Screen Report, released in March 2016 using data from Nielsen’s Television Audience Measurement panels and other insights.
The figures show 84 percent of the audience – 3.2 million New Zealanders aged over 10 – are viewing more than 23 hours of broadcast TV a week. In comparison, online New Zealanders spend 15 hours a week using the internet.
It is clear the TV set is now used for other things, such as watching online videos and gaming, but free-to-air television watching is still key.
Atford says New Zealanders aged 15 to 29 have the highest proportion of other TV use; however, for every minute they spend doing this, they are watching more than two minutes of broadcast TV content.
The power of television is clear for Warehouse Stationery’s general manager marketing and ecommerce, Becki Rowe.
She says it is the best way to reach the retailer’s diverse mix of customers, including businesses, students, parents, and arts and crafters.
“TV is one of the most cost-effective means to reach such a mass audience with a wide geographical spread,” Rowe says. “It remains one of the most immersive creative channels, and allows for a clear and dynamic delivery of our message.
“It is the best medium to convert customers at the greatly valued emotional level.”
Briscoe Group managing director Rod Duke agrees television is one of the best ways to reach a big audience.
All three of the group’s brands – Briscoes Homeware, Rebel Sport and Living & Giving – use TV advertising to drive sales. This complements the brands’ mailers, plus other advertising, such as digital, Duke says.
The success of TV advertising is easily monitored in sales, he says.
“Advertising informs people but it has to be sales-generating. If I’m getting enough eyes and my offer is compelling enough, I will generate the sales, and we will re-advertise.”
Countdown – one of the country's main TV advertisers – agrees TV is still one of the most cost- effective ways of reaching a broad audience, says communications advisor Keith Cowden-Brown.
However, the supermarket says it chooses the right channel to advertise its different offerings for customers – whether it’s TV, digital or outdoor advertising, or its own proprietary media.
TV’s image problem
There have been plenty of untrue statements around the “imminent death” of linear, broadcast TV, says Glen Kyne, the chief commercial officer of MediaWorks – the company behind TV3 and Bravo.
MediaWorks is about to embark on a campaign to promote the current power of TV advertising and debunk a few myths, he says.
“There’s no question that there’s different platforms coming onto the market – Netflix being one of the most talked about,” Kyne says.
“[But] more households have TV than internet: 96 percent have a TV and 84 percent have internet access. While digital video viewing is on the rise, still only less than 40 percent of viewers access video via a computer or mobile device.”
Digital companies – including international ones with a big budget – have done a good job of promoting the benefits of online advertising, Kyne says. He believes that while TV and online advertising can complement each other, each plays a different role.
“From our research, we know that TV remains the best place to build brands and product awareness.”
Kyne says New Zealand is entering a “golden age” of television, through great content. As a result, people watch more broadcast TV now than they did 10 years ago.
Key to this is providing viewers with programmes that they want to see and, increasingly, this is New Zealand content, he says.
The power of television advertising is further emphasised by the number of online-only providers who take advantage of the medium. The likes of Trivago and Webjet are large TV advertisers, Kyne says.
MediaWorks has also seen a “huge increase” in TV advertising from the retail sector in the last 12 months. “That says it all,” he says.
TV has suffered from an image problem in the last few years, agrees Rufus Chuter, head of strategy at media agency FCB Media. However, it still remains one of the most effective ways to reach a large number of people quickly.
Chuter cites marketing scientists as saying that despite the growth of digital platforms, brands and businesses need visibility and reach – not targeted campaigns – to grow.
“TV shouldn’t be ashamed of its relative inability to target niches; ‘fast and vast’ communication is critical to reach the infrequent shoppers that typically make up the majority of a business’ customers,” Chuter says.
Television’s ability to be immersive and engaging is also key to advertising success, he adds.
“We’re irrational, emotional creatures so TV’s ability to elicit strong emotional responses can be critical in building brand affinity.”
With Kiwis’ attention increasingly becoming fragmented with different offerings, TV has a near-unique ability for advertisers to tap into the “cultural zeitgeist”: moments when Kiwis are all watching at the same time, he says.
“In this respect, it can be a critical fire-starter for sharing and deeper engagement through social channels.”
Chuter explains this is why so-called “event TV’ – like All Blacks games or the US presidential debates – have such a premium for advertising.
Core business is strong
Retailers are one of the biggest spenders on TV advertising, according to TVNZ commercial director Paul Maher.
This is probably because they understand the unprecedented ability of broadcast TV to reach half of the New Zealand population in a day.
“Commercial TV in this country still delivers, every day, somewhere between 2 and 2.5 million New Zealanders to the platform actually watching the programmes and advertising,” Maher says. “That is unmatched in pretty much every country in the world and unmatched in this country by any other medium, bar none.”
TV advertising is also extremely cost-effective when worked out as a cost per 1000 viewers, Maher says. New Zealand’s small size means there is less of a need for niche marketing, he says. The limited number of broadcast channels in New Zealand also makes TV advertising more effective than in other countries.
Maher is not unrealistic, though. He recognises subscription viewing, such as Netflix, does compete with broadcast TV for audience attention – even though it has helped to increase overall video watching.
“We compete by trying to make the viewing experience as good as it can be and making our product as good as it can be,” he says.
TVNZ and MediaWorks each offer advertisers opportunities for sponsorship and running adverts in closely aligned programme. Advertisers’ interest is high in popular shows, such as My Kitchen Rules, The Block and The Bachelor.
Both networks say sponsorship seems to be very successful, as long as the brand is the right fit for the audience.
TVNZ and MediaWorks also offer their programmes online, for those who prefer to watch on demand. Advertising is also offered with this.
Maher says TVNZ’s on demand offering is changing, with more programmes launched online before they are broadcast and the ability to “binge watch” favourite TV shows. But while the options to watch video online are ever increasing, Maher still firmly believes in the power of broadcast TV and its appeal to audiences.
“I have a personal view that the free-to-air commercial TV will remain incredibly powerful in this country,” he says. “The ‘lean back’ experience of TV is incredibly appealing to consumers.”
Weighing good and bad
Retail marketing specialist Fiona Kerr, from Hotfoot, says one advantage of television is the fact people watch it most often after hours or in the weekend, as opposed to digital platforms which are sometimes watched at work, and usually with the sound down.
“TV is probably reaching people when they’re winding down from the day and have less time constraints.”
Another bonus of TV advertising is the range of sensory offerings in a commercial, Kerr says: “It’s got visuals, audio: it’s the full package of the ability to tell a story.”
She believes that the biggest advantage of TV advertising is its reach to a mass audience, but Kerr says TV advertising does have some disadvantages. With a mass-media offering, TV advertising is not as targeted as other forms of advertising, such as online advertising, which can really drill down into audiences, she says.
The cost of TV advertising can be a barrier for retailers, as there is a need to pay for the advertising slot, as well as creating the commercial. Kerr says this can run into hundreds of thousands of dollars.
Another disadvantage of television advertising for retailers is the time it takes to get to market. Time slots need to be booked in advance and production of the commercial can take time, Kerr says.
“It’s a bit of a ball and chain in terms of ability to move quickly.”
Rufus Chuter says while TV is a reasonably accessible medium with good flexibility, one of its disadvantages is its ability to reach a regionalised audience. This means TV increasingly favours national advertisers, he says.
He also mentions an increasing use of personal video recorders and “multi-screening” where people watch telly while also having their tablet or smartphone in hand. It is crucial to ensure an ad stands out, Chuter says.
“Brands need to be prepared to invest in quality, distinctive creative.”
Don’t be a wallflower
Television commercials need a catch to grab attention and a clear message to keep viewers engaged, especially due to multi-screening, Fiona Kerr says.
“What is most important is the hook: what will make them sit up and take notice?”
Retailers need to be clear about what they are selling, why it matters to the customer and how the customer can make the transaction, Kerr says.
Grabbing people’s attention can be as simple as using a recognisable voice, according to Rod Duke from Briscoe Group. Briscoes is famous for its consistent use of the “Briscoes lady”, Tammy Wells, who has been used in the brand’s TV commercials for more than 25 years. This has made her familiar in most households.
This can be a real advantage if people have the TV on but are not actively watching the ads, Duke explains.
“There’s pretty immediate recognition for customers to say ‘I know that voice. We’ve bought something from Briscoes before, what have they got going on this week?’”
The Briscoes ads have the all-important continuity and connect well with the target market, he says.
Duke explains TV advertising is an essential tool to inform potential customers about special promotions because Briscoes stores are not in shopping malls, where there is a high footfall.
Becki Rowe from Warehouse Stationery says TV commercials work best when they are pertinent and practical.
“It needs to be relevant – emotionally, tapping in to key audience motivation; and rationally, with the right product at the right price at the right time.”
Ads can focus on a company’s brand or focus on particular offerings. These two messages should be layered for best effect, Rowe says.
Warehouse Stationery’s current TV ads are focused on driving weekly offers, as well as creating brand awareness. This is done in 15-second commercials with straightforward product and price messaging.
“This simple format is an economical way for Warehouse Stationery to tell New Zealand which deals we have running each week,” Rowe says.
However, she says it’s the existing brand reputation which makes the TV advertising effective.
“Warehouse Stationery has built a strong reputation as one of New Zealand’s well known and trusted retailers… With such a strong, consistent reputation I believe people are more receptive to our messages.”
Backing up your TVC
Television commercials should not be a retailer’s only form of advertising. According to marketing experts, commercials need to be backed up.
It is “critical” for retailers to have their own website constantly updated and reflecting the same message as on TV, says Richard Stevens from BrandWorld. BrandWorld creates video content such as Food in a Minute and Family Health Diary.
“With technology driving our every decision, many people will go to your website to check out your product range, colours, flavours, sourcing of ingredients, packaging and pricing before they put you on their shopping list,” he says.
Companies wanting a national reach should tie television and magazine advertising together, while TV, radio, newspaper and outdoor are strongest at a regional level, Stevens advises.
He recommends social media and online advertising, such as Google AdWords and static banners, as low-cost methods of supporting a television campaign.
BP New Zealand marketing manager Leigh Taylor cites multi-screening as a trend that advertisers need to consider.
“The main barrier to TV advertising used to just be changing the channel, but it’s certainly not that simple today. The impact of multi-screening is very well-known, with competing messages creating considerable noise and clutter.
“As such, our media strategy needs to be developed in a way that complements and optimises this evolving consumer behaviour.”
BP uses TV, online video, point-of-sale, outdoor and radio advertising. While each may carry a different message, there is consistency with tone and language, and all messages designed to build or layer upon one another, Taylor says.
What about the future?
As online video offerings increase and TV viewing continues to change, broadcast television will continue to evolve.
Fiona Kerr imagines that the TV of the future will be a lot more integrated and interactive.
“Imagine a world where you saw a TV commercial and you could push a button or use voice command and order [the product] online,” she says. “You can’t live in isolation anymore and expect to survive.”
TVNZ’s Paul Maher says the option of interactive TV is possible now, with the likes of on-demand programmes and smart TVs. As time goes on, there will be better options and they will become more affordable to advertisers, he says. However, Maher does not believe this will replace the core offering of free, broadcast television.
“I think video will become a bigger and bigger part of customers’ media consumption and a bigger and bigger part of the advertisers’ expenditure.
“The free-to-air business will remain strong and will be supplemented by more video experiences, whether it’s online or with other platforms.”
This story originally appeared in NZ Retail magazine issue 747 December 2016 / January 2017