Broadcasters Aim To Avoid ‘Race To The Bottom’ With Streaming Ad Inventory

TV station groups have more platforms than ever between linear over-the-air television, diginets, websites, free advertising-supported television (FAST) channels, apps and more. But even with all of that, the business of local television continues to be focused on serving local communities with quality content they can trust, helping local businesses solve their problems, and having good relationships, said panelists at TVNewsCheck Working Lunch Webinar on last week.

“It’s less about the platforms and the technologies for us, it’s more about the simplification of the sales processes,” said Erin Overstreet, VP, digital sales, Gray Television. “If [our clients] are going in with a platform in mind, we’ve already kind of missed the mark with that client. Clients are throwing things at us left and right – all the new shiny objects – and it’s our job to stay focused on what they want to accomplish.”

“Early on in the process with the customer, we want to agree on what the expectation of outcome is and then work backwards from there,” said Missy Evenson, VP, sales, local media, E.W. Scripps, which owns TV stations as well as Ion, Scripps News and several multicast networks.

Stations’ digital extensions allow them to reach viewers where they are, whether that’s on their phones, computers or their actual televisions. Still, questions remain: How can account executives best craft cross-platform media plans that achieve their clients’ outcome goals and how can they instill value in their digital advertising inventory when there is so much of it in the marketplace?

“The sales process is really what’s become more holistic,” Overstreet said. “We want to follow the audience wherever they want to go. When we’re talking to the client, we keep it simple. We don’t talk about separate platforms and all of that – [the conversation is about] what the clients’ needs are and the solutions you are going to deliver overall.”

“We like to have our sellers take a client-first approach, which is to think like a marketer,” said Christopher Martinez, VP, OTT, director of sales, Hearst Television. “We want to ensure that we’re solving the right problem for that advertiser. At our core, we are a linear television company. So, a lot of the time our linear broadcast station is leading that charge, but we have a full suite of digital products, including streaming and audience extension” over the top.

While all of the panelists agreed that TV stations face challenges in terms of local-market measurement beyond just household ratings points, they also agreed that in the digital space, there are plenty of ways to measure viewership and for local advertisers, all that really matters is did their ad or campaign create the action they wanted it to create.

“Something I always remind people of is ‘before you started working with us, how many customers were in your store or on your website, and then after your campaign went live, how many people showed up?’” Martinez said. “I don’t care how much technology you have, if your cash register is ringing more after your campaign went live across any of our platforms, it is most likely pointing to a positive result without the need for complicated, complex data.”

Avoiding A ‘Race To The Bottom’

While broadcasters have found it necessary to be in the digital space as media has evolved, the sheer amount of digital inventory in the marketplace has pushed pricing downward. Advertisers don’t necessarily distinguish between ads that pop up at the top of Google searches versus ads that appear in carefully produced streaming local news. And that lack of distinction creates problems for broadcasters in digital and streaming spaces.

“We have a tremendous amount of scale right now,” Evenson said. “You can have boatloads of impressions to sell but high-quality brand-safe spaces still matter to advertisers. We need demand to catch up to supply; there is no shortage of supply right now. What we have to be careful about right now as broadcasters is this can’t be a race to the bottom.”

In the local digital space, big technology companies like Google and Meta have vacuumed up a lot of the ad dollars with search and social campaigns. Those types of campaigns, which are typically populated with programmatic advertising, bring down the value of more carefully crafted campaigns that broadcasters feel they place in more curated and brand-friendly environments.

“It is on us as the broadcasters and producers of local content to hold the line that this is a product that you should be paying a premium CPM for because you very quickly see those dollars reinvested on to TV screens and in the services that we provide,” Martinez said. “I know organizations like Hearst, Scripps and Gray are doing what we can to pitch the value of what local is bringing.”

Taking Different Approaches To Digital

Ahron Young, a former broadcast journalist, launched streaming news service Ticker in 2019, which Melbourne-based Young describes as “a bit like learning to ice skate during an earthquake with a tsunami warning – anything could happen at any moment.”

Ticker works with brands to create news content as well as content around thought leadership. It then marshals the power of social networks such as LinkedIn to create a community around that content. Ticker content currently streams on its website as well as on FAST channels and smart TV platforms around the world. The content is sponsored but it’s also authentic and informative, Young said.

“No one wants to watch a TV network that feels like it’s pay to play and we’re really careful to make sure that that isn’t the case,” Young said.

But he also recognizes business reality: “There’s no point in having 10 million viewers if you can’t pay the bills, and I think that has actually become a possibility in this day and age,” he said.

Megaphone is another company that offers a unique product mix, specifically for local broadcasters. Megaphone has a suite of interactivity tools that allows viewers to interact with local newscasts through polls, quizzes, questions of the day, user-generated content and so forth. By offering that technology, Megaphone has found itself in the middle of relationships between broadcasters and brands, so it’s begun offering itself as an agency-like extension for local broadcasters, crafting pitches and campaigns that incorporate Megaphone’s interactivity tools.

“What we try to do is eliminate as much effort from the broadcaster side as possible,” said Megaphone TV CEO and Founder Dan Albritton. “We try to handle every piece of the creative through the business consulting pipeline. And when you show a broadcaster that you are getting a 46% close rate on any campaign when we’re the ones doing the pitch, I think most of them will say ‘this is fantastic. I close at a higher rate, and I don’t have to do any work.’ Who’s going to complain?”

While broadcasters are offering advertisers more platforms with more bells and whistles, at the end of the day, the business of broadcasting continues to be anchored by its communities and relationships.

“I think being in partnership with the business owners in the community is a pillar of Gray,” Overstreet said. “What we do for our clients can determine whether they have a fourth or a fifth crew on the road in a snowstorm, whether a business owner keeps their doors open or whether they are able to put their kids through school. We have an obligation to understand what we’re selling and why.”