Question 1: What could/should advertising look like in 2020?
Question 2: What should we do now to get ready for that future?
As we examine current trends in marketing, it is evident that the shift in power from advertiser to consumer – or proactive prosumer – continues in favor of the prospective buyer at an astonishingly rapid clip. While many of these trends are just beginning, it is apparent that we have reached a point of no return where such prosumers will be able to increasingly exercise their will to buy what they want, where and when they want, at a price of their choosing. As we gaze into the crystal ball and imagine what 2020 might look like, the natural evolution of many of these trends is likely to accelerate unabated. As an expert in direct response television advertising, my point of view will be directed largely at how TV advertising of the future might look.
Advertising will increasingly depend upon participation versus interruption: With technology such as DVRs and remote controls that allow time to be shifted, ads are increasingly being skipped or obliterated altogether. At the same time, the same prosumer that is foregoing traditional ad content is willingly opting in for such messages online, if they are considered topical, entertaining, humorous or outrageous. Therefore it is likely that the role of so-called viral videos that are edgy — and that do not depend upon approval from broadcast network standards and practices departments — will increasingly supplant the traditional interruptive TV ad model for viewership. Exceptions will no doubt include the Super Bowl, where the advertising is considered as much a part of the entertainment as the game, which is why it is likely we will see the advent of the $10 million TV spot in our lifetime. This also suggests that sports and news programming will be the last bastions of the interruptive TV advertising model, because people will still want to watch these programs in real time.
Consumers will be able to narrowcast their stream of consciousness: In line with this thinking is the notion that consumers will be able to essentially narrowcast their every whim, watching what they want when they want to. If you think about it, this is what they already do when they surf the web. With a glut of cloud-based TV programming readily available sans advertising, today’s prosumer is already unbundling their viewing habits from any sort of advertiser-sponsored appointment television being set by the broadcaster (save for exceptions such as the above referenced live sports and news, or the occasional singing or dance competition that is the stuff of water cooler scuttlebutt).
A single revenue stream is supplanting the dual revenue stream that cable TV networks pioneered, whereby they collected monies for both programming and advertising. This echoes the broadcast days of yore when major networks relied on a single revenue stream (advertising) and offered their programming for free. In other words, the subscription fees subscribers pay for premium services such as Netflix and HBO eliminate advertising revenue to a large degree or altogether. That is part of their consumer promise – no commercial interruptions. However, given the escalating costs associated with such original programming (“House of Cards” alone cost a reported $100 million), it is unlikely that this model will be sustainable long-term. Instead, it is more probable that new ad-based models will emerge to help offset such overhead. Enter the key to the future of advertising: relevancy.
Data will facilitate better target-ability as consumers trade privacy for relevancy: State-of-the-art set top boxes, Smart TVs with built in web capabilities, and emerging technology models are giving broadcasters the ability to increasingly target ads to individual households based upon demographic and psychographic characteristics. This capability is likely to become even more sophisticated in the future, providing consumers are willing to trade privacy concerns for content that is meaningful to them (a trade-off that online prosumers are already being conditioned to accept, despite the occasional saber-rattling of consumer rights groups and grandstanding politicians). There is a reason that prosumers are willing to accept this:
Fundamental prosumer impulses will not change: Homo sapiens have been hunters and gatherers since the dawn of man. This is just one of the tenets of human nature that simply will not change in the future any more than the fact that we are tribal by nature. Another is our tendency to fall prey to scarcity mentality because we want what we can’t have. And, of course, we love a bargain. The old saying, “Word-of-mouth is the best advertising” is simply being expressed in an exponential way through social networking. The backyard fence now crisscrosses the globe and its importance is only going to become more acute in the future. Social media strategies that address what consumers want, and reflect behaviors they are already exhibiting, will win the day — versus social media strategies driven by a particular marketer’s self-serving agenda.
Devices will streamline the ability to conduct ecommerce: Finally, once your prosumer is enticed by your offer, a simple press of a button, swipe, or voice command will be all it takes to execute a purchase decision. This device might be handheld – such as a smart phone or remote control — or a wristwatch, or even an interactive voice command module built into your even Smarter TV of the future. While this ease may create more buyer remorse, the fact is every purchase is increasingly becoming a “considered” purchase, because information worthy of prosumer consideration is readily available for every product and service online. Hence a consumer of the future is likely to be even more thoughtful about what they purchase and the price they pay prior to pulling any compulsive trigger, and this may help guide purchase decisions that stick.
As for what marketers can do to prepare for the future, recognizing the trends outlined above and thinking in terms of how integrated advertising can move more toward a participative model that leverages word-of-mouth is key. Gone are the days where one form of mass media usurps another in terms of importance (e.g., radio trumping daily newspapers, TV outpacing radio). We have entered an era of rapid evolution where new models are constantly emerging and competing for the prosumer share-of-mind. As fundamental as it may sound, the very best thing any marketer can do to ensure their success is to offer goods that deliver on their promises. Regardless of the advertising tactic, it is the strongest guarantee a marketer can rely on to build a tribe of avid brand ambassadors who help spread favorable buzz about a company’s products or services.