TVAPOCALYPSE – How Are Brands Changing TV Buying with Vinny Rinaldi – Hershey

GARY MILNER : Vinny, one of the things i wanted to talk about today is how brands are thinking about the digitaltvadbuying market. Half of the media market is digital today and TV hasn’t been traditionally digital, but dependent on information sources anywhere between $2bn and $10bn of the $70bn TV ad market is bought digitally. If you consider the shift in media consumption patterns monthly this market is likely only going to keep growing, TV is not going away, just how we plan, buy and measure the medium will rapidly change. Can you give us an overall view of your role and how you see this market is changing for major brands like Hershey.

 

VINNY RINALDI : This is top of mind at Hershey, we talk about this every day. I oversee all addressable media at Hershey, which is inclusive of all audience and data strategy, our ad tech stack and all digital buying outside social platforms. Hershey is predominantly an old school marketer, what i mean by that is we do what works best, we are selling $ chocolate bars and the reality is that everyone eats chocolate. We have 98% household penetration in our category which allows us to really market to everyone. Predominantly TV works well, you can reach a broad audience, same with Facebook. However as we start looking at our market through a consumer lens, there is more data available than ever before. Its important to address how we buy media differently that is more relevant to our audience in real time vs hoping to reach 40% of our audience through a ratings point or just a spray and pay methodology. We have to move and shift from old ways to the new world and the more comfortable we are with data strategy and audience alignment to who is purchasing the brands that is how we will tip the scales over to being more audience driven than media driven.

 

GARY MILNER : You have approximately 3m subscriptions a qtr leaving the traditional paid TV ad ecosystem with some reconnecting back through streaming alternatives and an increasingly large proportion of millenials avoiding pay TV entirely. How is this growth affecting your media choices?

 

VINNY RINALDI : Good question, especially as 4 years ago, 98% of our media $ was in linear TV. Brands are starting to see that through data points and market analysis the market is changing. TV isnt dying, we are still buying TV, just consumed differently and bought differently and still getting to the same mass market. Our planning has slowly changed, not as fast as we would like, we are still going through education internally to allow understanding of how does our measurement still show that impressions are not just ratings points but shows that we are growing incremental reach. We need to show incrementality when we buy TV in an OTT/connected TV/addressable environment. This is where the industry is still evolving,

We need to know when we have our reach points from a TV perspective and we look at our media mix model, how do i include those impressions coming from streaming as it is still “TV”. As we shift more $ to this media, we need to make sure we have the right measurements in place.

 

GARY MILNER: Are you looking actively at the Nielsen products that measure the incrementality of digital video and advanced TV laid on top of your standard linear TV buy? My understanding is that this will allow you to understand incremental reach.

VINNY RINALDI: We have kicked off conversations around this, but have not implemented. We will kick it off 2019 and beyond to look at long term value, This is new and im sure it will have its’ challenges but we are open to staying ahead of the game with the leaders in this space.

 

GARY MILNER: So when you do your upfront TV planning and buying, do you see what the GRP model needs to change to?

 

VINNY RINALDI: I think this comes back to the audience by household, we live and die by a predominant old model inclusive of a small panel that had been the industry leader from Nielsen. We have the ability to reach 122m households in the USA with TV, yet the panel reaches sub 50k households. Its kind of hard to scale that out, given the amount of data available today. The more we can measure the household the more we can measure incrementality , we are stuck in an old model. We need to grow what we have, not get rid of GRP.

 

GARY MILNER: I think it may come down to the growth of the streaming services. Personally i think the estimates from e-marketer are grossly under-estimated that 20% of the population will have left paid TV by 2022. It will be much more. Reason being is that, from what i see the current streaming users outside those using Netflix/Amazon are usually more tech savvy are in the industry. We haven’t reached the AHA moment when a large audience realize that they can switch from paid cable or satellite to paid streaming and/or free streaming services. Its almost similar to the changes with DVD rentals when that market switched real fast when people realized that they could get the same product through streaming, a box or through the post. A friction free process. We havent reached the point with streaming services where its easy to move and easy to understand, that will change. When that happens it will pull the buying methods with it.

 

GARY MILNER: What is nirvana for TV buying and how fast will we get there?

 

VINNY RINALDI: I think it will take 5 years at least to get to a more integrated digital ecosystem. The adoption of digital TV is great and scaleable, however when you look at the set top box it isnt going anywhere, the more we can make this box inventory adressable and biddable so that we can make decisions on reach and frequency so that im pluggging and playing with creative rotation, thats when we get to the nirvana. An ideal for a portfolio of brands is ONE media budget that inserts the most relevant creative into TV, digital, social that makes the most sense for that consumer at a given time. Impossible unless everything becomes in a biddable environment with an ability to measure in all channels plus walled gardens, That is nirvana, not sure we will get there, television may get closer as some of the MVPD will enhance their capabilities. We need to the old to leave the business and the new early adopters to lead the industry into a shift.

 

GARY MILNER: A lot of this will be driven by the growth of paid tv streaming services away from set top boxes. There is a lot of cost in those boxes that is in their benefit to move people over to non hardware supported media. It will be interesting to watch this, it may be faster than we think. If Amazon and/or netflix add an ad supported environment that changes the dynamic even further, more digital TV inventory becomes available shifting the mix to digital even more.

Anyway, thank you for your time today Vinny. I look forward to our next conversation.

Gary Milner is an international brand consultant.  Learn more about him at GaryMilner.com

Leave a Reply

Your email address will not be published. Required fields are marked *

RSS
Follow by Email
YouTube
YouTube
LinkedIn
LinkedIn
Share
https://www.thedailyblaze.com/pet-hairs-vacuum-cleaner-reviews/