Why Targeted TV Advertising Is Cheaper Than You Think

Despite the accomplishments of digital marketing techniques over the past two decades, TV advertising has remained one of the most powerful tools for businesses to reach out to audiences. Whether it’s for the purpose of developing brand awareness, driving a rapid response, or connecting with new and existing customers, there’s no way around it – TV advertising just works.

With targeted TV advertising, businesses are able to speak directly to the most relevant audiences, who are already more partial to their specific service or product. By strategically placing engaging audio-visuals in front of the right people at the right time, your consumers will be much more inclined not only to pay attention, but also to take action. This is why targeted TV advertising has continued to generate the most profit, create the most sales and consistently outperform all other marketing channels.

What’s more, targeted TV advertising is the only marketing medium where costs have not risen over the past decade. To the contrary, producing a TV ad is now 30% cheaper than it was a decade ago. The fast-growing medium is becoming more accessible now than ever before. So why, then, are so many small and medium-sized business still passing up the chance to deliver long-term growth and missing out on targeted TV advertising?

A lot of the time, it comes down to not knowing what a targeted TV advertising campaign actually entails, and common misconceptions about the costs that are involved. We’re going to take a closer look at some of these misconceptions and hopefully change your mind if you’ve never considered targeted TV advertising before.

“Targeted TV advertising is too much of a mass-market approach for a small or medium-sized businesses”

Many businesses often equate TV advertising with nation-wide broadcasting and dismiss it as too far-reaching for the specific market that they’re trying to appeal to.

But with targeted TV advertising, nationwide broadcasts are rarely used and mass-marketing techniques are avoided altogether. Instead, campaigns can be restricted to specific regions, cities and even postal codes. TV networks and marketers have recently taken this concept a step further by harnessing new ‘big data’ tools to gain demographic information on each household. This means that ads can be targeted with unprecedented accuracy to the smallest and most relevant groups of people.

The sheer scope of information that networks such as Sky Adsmart are able to access is both impressive and slightly unnerving. To give you an idea, viewers who opt in to the service will receive advertisements that are specifically geared towards factors such as their income bracket, their marital status, their age, their gender and even their past purchase history. You could receive advertisements targeted towards something as specific as your favourite type of cheese, based on your Tesco Clubcard or Nectar card information.

It’s surprising how much information can be shed on each household. This data comes from a combination of customers’ satellite subscriber information and marketing segment data taken from Experian and other consumer profiler experts. Sky Adsmart are able to look at everything from their customers’ home and car insurance information to their digital footprint and their credit ratings. Soon, there could be no stone that’s left unturned.

For advertisers of even the most niche products and services, Sky’s ability to utilise this information comes in extremely helpful. A sports cars dealership could choose to target the highest earning households within the local area, while a business specialising in pensions could target only those working in specific professions who fall into the relevant age bracket. This way, advertisements are going out to as few people as possible, but the impressions being made are a lot more valuable.

And the best thing about Adsmart is that viewers opt in. So far, 7 million of Sky’s 12 million subscribers have chosen to receive tailored advertisements, preferring to see more of the products and services that they’re actually interested in. It’s clear that personalisation is the key to victory rather than generic marketing efforts.

"Targeted TV advertising is too expensive”

Many businesses may also write off the possibility of television advertising because they believe it to be too costly, and something that’s only done by large corporations. However, since you may only be addressing a few thousand homes at a time, the capital costs of targeted TV advertising are kept down.

You can also be sure that your advert is being seen, with a guaranteed number of impressions for each household. Pricing is based on cost per impression, which means that your ads will be shown on recorded TV as well as live airings. If a viewer fast-forwards through your ad, you’re not charged a penny until it has been watched at least 75% of the way through. Your ad will be shown to the relevant households at least 4-5 times, which is enough to leave a lasting impression in their minds.

Much like digital marketing, you can track the specific impact of your ad and test out certain variables on a small cross section in order to determine the most effective future strategy. The cost of your campaign will depend on the attributes chosen, and can differ with the frequency of your ad, the time of day that it’s shown, and the volume of viewers that the specific channel or programme attracts.

Another factor making targeted TV advertising more cost-effective is the extremely short lead time between a TV ad made seen and a sale being made. This is because most households will watch TV with an open laptop, a tablet or a mobile phone at hand, making them more likely to find out more or communicate about the content they are receiving. Thinkbox’s TV and Online Study found that TV advertising often leads directly to an online search or a comparison and a more immediate purchase.

It’s estimated that targeted TV advertising generates an average profit return of £1.79 for every £1.00 spent. Whatever the size of your business, you’ll be able to utilize how your ad is shown and who it’s shown to, in order to make sure that it delivers the best possible results.

“Making the ad will be too expensive and time consuming”

An effective TV advertisement does not necessarily require a high budget. A clear concept and call to action are what’s most important.

Take the example of the Dollar Shave Club advert which went viral in 2012 and attracted 12,000 new customers to the company within the first 2 days of being shown online. The video resonated with thousands of viewers by using humour to mock the traditional shaving titans and satirise its own unpolished and purposely low-budget production. There’s no reason why you can’t have the same sort of impact with your ad. Do something unique, and people will gravitate towards it.

In the past, producing a TV advertisement required significant funds, but the existence of new technologies means that the costs of making a TV ad are lower than they have been in decades. There’s a range of high quality, low-cost production companies who specialise in creating TV advertisements. As well as this, you’ll only need a relatively short space of time to make the video, and it could be shown on TV in as little as 6-8 weeks from the initial briefing.

If you’re not keen on hiring actors and a production crew for a live-action TV ad then you could create an animated video instead. Other than purchasing studio time with an animation company, these types of advertisements require minimum spending. The popularity of animated characters can be timeless and one of the best ways to connect with audiences in an engaging way.

So, is TV worth it?

Whatever the size of your business, targeted TV Advertising remains the most cost-effective marketing medium and the best way to reach out to consumers. It’s no wonder that companies such as Netflix, Facebook and Google spend 60% of their own marketing budgets on TV ads in the UK.

But targeted TV advertising isn’t just for large corporations with huge budgets. Thanks to the availability of big data, TV is becoming a lot more like the digital landscape. With the power of TV being used to greater effect, targeted advertising is now a viable option for smaller and medium sized businesses too, with room for niche brands and location-specific advertisers.

If you’re wondering exactly how rewarding TV advertising can be for smaller businesses, networks such as Sky Adsmart can provide you with plenty of success stories. NOW: Pensions are just one of Sky’s many locally-based niche brands who were completely new to TV advertising. After just one month of targeting small business owners specifically in the Meridian region, NOW: Pensions managed to deliver over 200,000 impressions and gain 61% more sign-ups than the previous month, with the region delivering a much higher traffic rate than their national average.

The kind of personalisation that targeted advertising allows for is truly game-changing. So, if you’d like to get the very best return on investment from your marketing efforts and deliver long term business growth in the future, it’s time to invest in some air-time!

If you would like to find out more information on TV Advertising, or would like to understand how I could help don't hesitate to send me a message!