Each year, more and more people “cut the cord” and turn to streaming video entertainment, making traditional live TV advertising much less effective. How can marketers reach the cord cutters? 
With declining reach from live TV, meeting gross rating point (GRP) goals requires more frequent ads that are more costly. This is because the reach to 18-to 40-year-olds has decreased as people move to streaming video options, leaving 31% fewer GRPs for broadcast and live TV. As a result, marketers must advertise almost 50% more frequently to achieve the same GRPs.
In addition, the cost per thousand impressions (CPM) has increased by 43% for broadcast TV and 54% for cable TV.
It seems that a change in marketing tactics is needed. Nielsen Total Ad Ratings studies (TAR) gives brands the ability to compare TV reach to video reach directly. Three large brands have used data from TAR to change their video strategy. Here are their results:
- Fiat Chrysler Automobiles’ target market for a particular campaign was 25- to 50-year-olds. TAR results found that almost 60% of the target audience reached by YouTube was not reached by TV. Although YouTube was responsible for only 7% of overall campaign impressions, it also was responsible for almost one-quarter (24%) of in-demo reach to the target group.
- The Hershey Company’s campaign for Reese’s Christmas Trees obtained ten times more reach from YouTube than TV. They found that 60% of the target group of 18-34 year-olds reached on YouTube never saw the ad on TV. That this result was obtained at a fraction of the cost of TV ads was an added bonus.
- An AARP campaign had 70% more people reached in its target group of 45- to 64-year-olds with YouTube than TV. In addition, the cost to reach 1000 people in the target group with YouTube was $51, compared to $164 for TV.
Has your organization made changes in its video marketing strategy to account for cord cutters?