It’s Prime Time for Retail Brands to Shift From Linear to Digital to Capture TV Audiences

So much of life today is happening in front of the television. For consumers in the U.S., most of whom are spending far more time at home, the TV has once again become the cornerstone of daily entertainment and family time. According to Nielsen, viewership amid the pandemic has increased by as much as 60 percent. As retailers re-evaluate their advertising strategies for the COVID age, it’s become evident that TV still holds its place as a vital part of the media mix.

While the notion of family time in front of the TV may elicit some nostalgia, the new landscape retailers must navigate to capture these audiences is very different than it used to be. Consumers are moving toward digital video and connected TV (CTV) at a record pace, leaving linear behind. For retailers, these new viewing habits provide an opportunity to execute a far more efficient version of the brand awareness and excitement that TV advertising affords, even across an increasingly complex and fragmented media environment.

The TV Landscape’s Seismic Shift

It’s clear that more people have their eyes on the TV screen during quarantine, but how many of them are actually watching “TV”? The last 10 years have been the most dynamic for television since it first made its way into the American household as a clunky box broadcasting four channels in black and white. And perhaps, this past decade is most indicative of TV’s future.

2010 marked the year that the number of households paying for linear television hit its peak, at 105 million. Since then, there has been an increasingly precipitous decline as “cord cutters” ditched their contracts in favor of leaner, more cost-effective streaming services. A growing group of millennials and Gen Zers are entering adulthood without ever having paid for a classic cable TV subscription.

In an effort to keep increasingly digital audiences watching, broadcasters unleashed a continuous current of new offerings for cost-conscious consumers without a need for 500 channels. What emerged was the “skinny bundle,” with companies like AT&T and Dish Network offering virtual, cord-free counterparts like DirecTV Now and Sling TV. However, as competition heated up, so did the need to draw larger audiences, and the amount of skinny bundles bulked up. Over the past year, we’ve seen this battle begin anew, as one media company after another — from CBS to Disney — launched their own streaming platforms. Though it remains unclear who will win the war, there's no doubt that digital is here to stay.

Now, social media favorites are even making it onto the TV screen, and they’re not shying away from their intentions to disrupt traditional models. YouTube has more than 100 million unique viewers across U.S. TV screens per month, and has begun laying the groundwork for retailers and other advertisers to view the platform as one not solely intended for desktop or mobile use. In early August, pandemic viral paragon TikTok announced the launch of a new app for Amazon Fire TV, while Facebook, Instagram, and Pinterest have all doubled down on video content and services to capture at-home audiences and brands’ ad dollars.

Targeted Opportunity for Retailers

With all of the changes taking place in TV, retailers have a huge opportunity to get in front of the mass audiences they crave, but in a way that’s far more efficient — perfectly suited for the small spend/big payoff mindset required in these times.

Of course, on the most basic level, retailers continue to make channel-based digital video ad buys. In this instance, a retailer uses a specific channel as a proxy for its audience of viewers. For example, if a retailer knows that a particular YouTube channel reaches its target audience, it can buy ads against that channel without ever making a personally identifiable information or identity-based consideration.

Taking this a step further, retailers are clearly looking to differentiate themselves from the competition and make an impact by building connections with consumers. To do this, retailers and brands are realizing the advantage of looking beyond television for compelling integration opportunities. Why? You can still hit the same demos, the same engaged viewer, the large scale audience as you would on a linear TV program, but at a fraction of the cost. How this is accomplished might include a full custom branded video in the style of the channel that the online viewer is already accustomed to. Or it may include a placement of a product prominently featured within the video content.

This is truly an exciting time for brands and retailers, of all sizes, as the prevalence of digital allows accessibility for those looking for highly visible opportunities towards a relevant audience.

Even as states have lifted their lockdown rules, CTV viewing numbers remain at an all-time high. The new state of TV advertising aligns well with both consumers’ shifting behaviors brought on by the pandemic, as well as retailers’ own changing needs. This clearly makes digital the most efficient and effective opportunity for retailers to reach audiences successfully.

Jonathan Kowalski is the global head of sales, brand partnerships for TheSoul Publishing, an independent digital studio that produces enjoyable, informative and inspiring original content for a global audience.