Home Analysis Advertising Budget will drift to the TV innovators in Canada, GroupM warns

Budget will drift to the TV innovators in Canada, GroupM warns

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You can always save money and maximise return on investment in advertising if you refine your target audience and spend money on the lowest hanging fruit – those consumers who represent your best opportunity for driving sales. But if brands take money away from broad awareness marketing at the ‘top of the funnel’ to do this, they will fail to replenish that low hanging fruit and their market share will shrink.

This is the warning from Irwin Gotlieb, Global Chairman at GroupM, ahead of a discussion at Future TV Advertising Forum Canada next week about the merits of TV and digital, short-term and long-term marketing and broad versus narrow targets. He is a strong advocate of targeting, including via household-level addressable TV advertising, but he confirms: “When clients over-target, they lose market share. We have seen that consistently during the last 15 years.” His advice is to keep spending on broad awareness so that targeting is additional, not substitutional.

Gotlieb has also highlighted the danger that if you get the balance between TV and digital spending wrong, you may not know at first. “If people allocate more money to digital at the expense of television, they get short-term returns and don’t recognise that they have created a huge business problem – sometimes until it is too late. In most cases it costs brands more to buy back awareness at the top of the funnel than they saved in the first place.”

Future TV Advertising Forum Canada is being held at a time when the broadcast industry in Canada feels threatened by a pro-digital sentiment among buyers, and some inventory owners complain privately that there is an unjustified bias towards digital in Canada. Gotlieb thinks Canada is on a similar trajectory as other markets when it comes to ‘digital vs television’ sentiment, but with a slight time-delay compared to the U.S.

This means issues concerning the integrity of the digital supply chain have not had such an impact on buyer sentiment yet. He does not think Canadian TV has unique problems that will weaken its long-term prospects in the face of increasing digital competition, relative to other markets.

The message is the same for the Canadian television industry as everywhere else: “Decades of consistent growth limited the need for huge levels of innovation. Growth doesn’t happen by default any more, so it really is time to become innovative.

“When I say innovation, this is not simply about technology and data, but innovations in the business structure. The technology for advanced TV has existed for a long time but we need the business practices to support it.”

The GroupM chairman wants a non-adversarial approach to exploiting what he views as a massive opportunity for television, notably to become more addressable. “TV has always been the most effective media vehicle when it comes to branding, and creating broad awareness. We believe it can be similarly effective at every level of the marketing funnel. The objective for advanced TV is that it should operate beyond the top of the funnel.”

He has previously argued that TV can attract new money, including from trade budgets, if marketers can use it to influence consideration rather than ‘just’ awareness, for example. And Gotlieb notes that television is no longer limited to television sets, and includes multiscreen viewing.

In Toronto, the GroupM chairman will reiterate previous declarations that GroupM will have to start favouring TV inventory owners who provide the company with uncomplicated access to quality addressable inventory. This applies in Canada the same as it does in other major markets like the U.S. and across Europe.


Want to hear more from Irwin?

Want to understand more about what Irwin Goblieb and GroupM is thinking? Then join senior media buyers (brands and agencies) and the cream of the Canadian TV industry at Future TV Advertising Forum Canada in Toronto on April 20.  Irwin is also speaking at the invitation-only Advertising Pathfinders Canada event on April 19.

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