TV Not Dead: Why TV is Still King of Advertising Despite the Rise of Streaming

Video killed the radio star and, now, the internet is gunning for the TV. The way people consume content has changed so much over the years. The most popular way people watch videos and listen to audios is by streaming, a model popularized by platforms such as Netflix and Spotify.

Streaming in the Pandemic

The pandemic only made streaming more popular. Globally, in 2020, subscriptions to online video streaming services crossed 1 billion. The growth was driven by the absence of movie theaters which, throughout the past year, remained shutdown in the United States to prevent the spread of COVID-19.

While, prior to the pandemic, people were complaining about the number of online video streaming services to choose from, nowadays, the public has embraced it. Viewing increased by 44 percent during the last three months of 2020 compared to the same period in 2019.

The pandemic also created a new release model where a major motion picture is available on streaming and in theaters on the same date. This is what HBO Max did to “Wonder Woman 1984” and Disney to “Soul” and “Black Widow.” This model only increased subscription and time consumers spend on streaming video content at home.

Where is TV in All of These?

Surprisingly, television did not die in 2020 even as streaming became even more popular. In fact, for the first time in almost a decade, the time American viewers spent watching TV for entertainment went up.

The stay-at-home orders in place in the past year contributed to the trend. The newfound free time that many people suddenly had due to working from home or unemployment is another major factor.

Seniors are the biggest audience of TV. The number of viewers who were above the age of 65 went up. They are the most vulnerable to the pandemic and, therefore, they remained indoors for the majority of the year. As a result, they turned to TV for entertainment.

However, other age groups were also tuning in. The number of adults between the ages of 25-34 who watched TV declined by 3.2 percent in 2019. However, in 2020, viewership from young audiences was expected to go up by almost 5 percent. The 45-54 age group also saw a declining number of TV viewers in 2019, but saw a return of interest in 2020.

Whether the growth will be sustained after the pandemic is still yet to be determined. While the U.S. started rescinding restrictions in 2021 as positive cases go down thanks to vaccines, the new Delta and Lambda variants are proving to be more challenging to control. Many places around the world have gone back to lockdowns to control the spread of the virus.

person watching

Why is TV Still Relevant as an Advertising Platform?

TV is clearly struggling against online video streaming, and it has been happening for years. Some of these services, nowadays, also support advertisements in addition to a subscription model.

So, while TV had a better year in 2020, there is no guarantee that the trend will continue post-pandemic. However, despite the arrival of Netflix and HBO Max, brands continue to advertise on the small screen.

Major companies still hire reliable advertising agencies to create eye-catching commercials for television viewers. The reason for this is, even when viewership declines, TV still has a much greater reach around the world.

In fact, despite reports about the number of households that are cutting the cord, about 96.5 percent of all American homes still receive traditional TV signals as of 2019. For comparison, only 70 to 77 percent of all Americans are on social media.

Moreover, despite the number of people who signed up to one or more online video streaming platforms prior to and in 2020, it only accounted for 26 percent of the time spent in front of the TV. The majority of the time was spent watching network and cable TV.

The share of streaming platforms is on the way up. Predictions expect the time spent on streaming to increase to 33 percent by the end of 2021 — still significantly lower than television but it is a steep incline.

About 8 percent of the time spent watching video on-screen went to gaming, playing DVDs, and others.

Netflix, Apple TV, HBO Max, Amazon Prime, Disney +, and other online video streaming services are popular, but they still have yet to defeat traditional and cable TV. Brands should continue to invest in advertising strategies for the millions of people who continue to tune into their TVs. TV despite the arrival of new ways to stream video content, remains an effective channel for brands to reach consyumers all over the world.

 

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