TV essentially provides a ‘shop window’ for online brands and is also seen positively by consumers; conveying trust, quality, and credibility (Thinkbox).
Many online-born businesses increased their investment in TV advertising in 2021. Between January-July 2021, online-born businesses invested £559.9 million in TV advertising alone in the UK (Nielsen) for linear TV advertising spend, which is an increase of 37% compared with the previous period.
The increase in e-commerce was one of the biggest business behavioural shifts caused by the pandemic. Businesses that began online, with no prior bricks and mortar presence, accounted for 20% of all linear TV ad spend in Jan-Jul. This was ahead of Food (10.1% of linear TV spend), Finance (8.5%), and Entertainment & Leisure (7.2%).
Why are we seeing more online-born brands on TV?
TV remains the most effective driver of ROI
Why are more online-born brands turning to TV advertising? In short, TV remains the most effective driver of ROI for many businesses in the UK and across the world.
Research by Thinkbox shows that investing in TV as an advertising channel can increase a campaign’s effectiveness by around 40%. TV advertising generally makes brands more clickable and can drive much cheaper online journeys. According to Thinkbox, businesses across sectors increased their TV advertising spend in 2021, including:
- Online used cars services have increased TV spend by 235% compared with the same period in 2019
- Online food delivery services are up 194%
- Social media companies invested £10.6 million in TV in Jan-Jul 2021 compared with nothing during Jan-Jul 2019.
TV has the highest multiplier effect
Research by the IPA revealed that the most effective advertising campaigns used both TV and online media. This is also supported by Thinkbox’s study, revealing that TV made other media “work harder” by boosting the performance of other channels. Their research found TV to have the highest ‘multiplier effect’ of other advertising channels, including online search and display.
Our independent data; ARMalytics shows that TV adverts are key when it comes to driving brand search terms. This is advantageous because it reduces the cost-per-click charged by the search engine, as opposed to generic search queries which are performed by people without a prompt into market from a specific business. Newer online brands can benefit from this as they continue to grow by driving engaged consumers.
TV prompts viewers to search for a brand directly, rather than searching for a category as a whole, which has a positive effect on click-through rates on both organic and paid search.
When is the right time for online brands to get on TV?
1. You have a clever new product
Understanding your proposition makes consumers more likely to purchase, which is where TV comes in. TV can help to deliver messages better than other channels with a more limited communication space. If a product is complicated, TV can help to get the message across, and is therefore a useful medium to educate an audience at scale, and drive engaged consumers who understand the product and already have intent to purchase.
2. When you need to scale fast
When a new category is coming into market or looking to disrupt, scaling first and fast can lead to ownership of that category.
Eleanor Grieve, Account Manager at All Response Media discusses this in more detail, highlighting how brands such as Uber have successfully scaled first and fast:
3. When you’ve hit a ceiling for efficient online buys
Unsurprisingly, most online-born brands focus on online channels like social media and search. These channels can provide measurable online customer journeys and are relatively ‘safe’ in the sense that they often provide growth, are low-cost and are generally easy to control.
However, new businesses that are reliant on marketing for sales as well as growth, are likely to find that these online channels can only nourish this for so long, which is when a ‘bump period’ is needed. Growth for these brands can often come to a halt when additional spend in their usual marketing mix no longer delivering as much incremental returns. This is where TV can come in and provide the next phase in their growth, enabling brands to re-target and reach people are who not in the market right now.
TV can provide wider reach, richer creative and attention holding media to break through the plateau and improve the impact of other channels.
All Response Media viewpoint
With our personal data from ARMalytics , online-born businesses can see TV’s traffic-driving ability in real-time. ARM has long known the power of TV advertising, which has started to come to the forefront for more traditionally digital advertisers.
We successfully launched more new brands to TV than anyone else during the pandemic, due to recognising the opportunity for direct to consumer brands and other online businesses. A combination of the cultural change that saw consumers leaving the house less (therefore ordering online more) and the record low-cost TV pricing during the pandemic, meant we could get smaller brands on TV sooner than usual. The study by Thinkbox confirms that the opportunity was taken across the industry, and the benefits of TV continue to show with investment growing in post-pandemic times.