Publicis' Tobaccowala: Mass Media Is Far From Dead (But It's Not Growing Either)
This story was written by David Kaplan.
Despite the rise of video-on-demand and targeted advertising, mass media is still a viable form and will likely remain so. But within mass media, only TV will continue to stand tall as radio and newspapers decline, says Rishad Tobaccowala, chief innovation officer at Publicis Groupe Media and CEO of Denuo, its new media consultancy. In a long interview with TVNewsday, Tobaccowala contends that broadcast's strength lies in its potential to capitalize on the rise of digital. Still, he is quick to add that he's talking about mere survivability for the most part. Tobaccowala: "Traditional mass media is not a growth business, and so to continue to resonate and be relevant, broadcast stations need to basically embrace digital media, including the Web. You'll actually continue to have a healthy, viable broadcast business, but you have to accept it's not growing, and it's becoming less and less relevant to particular target audiences."
-- More than surviving: Broadcasters have to find ways of building up their online presences. In the past year, a number of broadcasters have tried to expand beyond the 30-minute news at 11 by crafting a more individual online brand. One prime example is NBC Universal (NYSE: GE), which formed a hyper-local "content center" around New York affiliate WNBC in May. Tobaccowala: "The networks and the stations have to recognize that they're in the video information and entertainment-delivery business. A broadcast station limits what they can actually do."
-- TV vs. newspapers and radio: What the broadcast part can do is deliver large audiences at scale. Since more viewers are turning away from newspapers than from TV, that makes broadcast still more valuable to advertisers. Plus, broadcasters have the natural experience and production assets associated with creating online video. As for radio, transferring their brands to online are difficult, as they have to compete with services like LastFM's as well as MP3 playersin other words, media that is largely commercial free. More from Tobaccowala on Google (NSDQ: GOOG) and Canoe Ventures after the jump.
-- Google is more expensive than TV: Relatively speaking, of course. His reasoning: Google AdWords, on average, across all categories, tends to be about 50 cents per-click. "Let's say on television you get a $20 cost-per-thousand rate. Fifty cents a click is equal to $500 cost per thousand. You can see how much more expensive it is, but the difference is there's some sort of action."
-- On Canoe Ventures: threat and opportunity: In June, cable ad targeting company Canoe Ventures was unveiled. The project has the backing of Comcast (NSDQ: CMCSA) and five of the other major cable companies. Tobaccowala says if the company works as its supposed toletting cable companies sell targeted ads on a national basisit will represent both a threat and an opportunity for local stations. "It will simply allow people to get a national footprint, and my sense is national advertising is not competitive with local advertising Today, spot cable basically sort of sits in between the worst of the programming, and it's hard to buy. Canoe is partly about making it easier to buy. Part of it is basically going to be make it more measurable. Local stations will have both the opprtunity of trying to figure out how to be more measurable, and the threat that they've got some other measurable media [competition]."
By David Kaplan