By Jenny Schauer, VP/Media Director, DigitasLBi
"Cord-cutting," perhaps one of the biggest buzz words of the year, is undoubtedly the culprit behind many sleepless nights in the ad community - and understandably so. As consumers move away from traditional TV consumption and towards digital content, it inherently limits our ability to reach them through a tried-and-true channel - and that's a scary reality for many marketers.
The video landscape has gotten gradually more fragmented over the years, but the recent surge in cord-cutting behaviors has the potential to turn the model completely on its head. In Q2 2015 the cable and satellite providers saw their sharpest decrease in subscriptions to date, with over half a million households walking away from their TV packages. And that number is only going to climb as more personalized offerings like Sling and Playstation Vue become widely available.
A tale of two strategies
As an industry we're approaching a fork in the road: The first path is to view cord-cutting as a nuisance and continue status quo in hopes that the trend plateaus before reaching critical mass. The other approach, certainly the road less taken, is to look at cord-cutting as an opportunity to reach consumers in a new way, and develop learnings in the space before other brands make the shift. Neither is right or wrong, the first is just a more conservative outlook on the marketplace, prioritizing the current landscape over the (predicted) future climate.
For brands deeply rooted in linear TV, cord-cutting could present a legitimate threat - TV investments continue to thrive, but will gradually deliver less return over time and skew even more towards frequency than reach. This approach rests on the belief that cord-cutting has generated a disproportionate amount of buzz vs. its relatively small scale - and that's true. However, as savvy marketers our job isn't to react to what's already happened or even what's currently happening. Our true value comes from future‐proofing our client's business for what's to come.
Enter the futurist approach to video planning. This is not an abandonment of traditional TV by any means, but rather a different way of thinking about media allocations. At the root of this approach is a deep understanding of the cord-cutting consumer - their motivations, their hesitations, and of course, their media habits. Even just a series of small pivots can collectively position a brand to survive, and even thrive, in a cord-cutter world.
- Embrace a screen agnostic approach: The most notable trait of cord-cutters is their desire to consume content when they want, where they want. To effectively reach this audience, you need to embrace all of the screens they're turning to for content - not only desktop, but also mobile, tablet, and especially connected TV. Among all of their digital options, cord-cutters still value the big screen most, accessing content via smart TVs, game consoles, and over-the-top devices.
- Content is king, no matter where it comes from: Rather than paying for 200 channels when they only watch two, cord-cutters are turning to digital outlets where they can hand-select the content they want most. These consumers are willing to go to great lengths to get the programming they are truly invested in, and a brand who can help bring the two together is best suited to succeed. While obvious sources for cord-cutting consumers - Netflix, Amazon, etc - are behind a paywall, don't under-estimate the power of watching a good TV show during its current season, or catching a sports match as it's happening. Just because they're not willing to pay for a cable subscription doesn't mean they value that content any less - so full episode players and streaming sports have a big role in the cord-cutter routine, enabling them to join in watercooler conversation.
While the rise of cord-cutting creates further fragmentation of the video ecosystem, we'd be remiss to ignore the advantages it also brings with it. The shift to digital screens ultimately delivers a more engaged audience who is actively seeking out the content they want. And while it's a new approach without a lot of certainty, brands who are willing to take a leap of faith can engage their audience in an uncluttered environment that's poised to grow exponentially in the coming years.
Armed with the right expertise and a touch of creativity, cord-cutting offers brands the opportunity to shift their marketing tactics from push to pull, and turn video - a "lean back" medium - into something audiences are now leaning in to.