LAS VEGAS—The continued rise of streaming services providing premium video without advertising avails is a big concern but it’s going to change within a couple of years. That’s because both Amazon and Netflix are headed toward ad-supported content, VMLY&R chairman David Sable predicts.
The bottom line, Sable explains in this interview with Beet.TV at CES 2019, is that TV advertising will need to rise to the quality level of the programs themselves.
Noting that he predicted 10 years ago that Amazon would have brick-and-mortar stores, Sable says, “Netflix within the next two years will have advertising. They have to, in my view. Amazon’s already going to be there.”
This means “we’re going to have more and more opportunities to put more and more great advertising” around premium content.
A once widely held view that with the rise of digital most video content would be user-generated hasn’t quite worked out, according to Sable, citing “the cat peeing on your shoes that everybody would share. That’s such crap. It’s exactly the opposite.”
In recent years, producers who once shunned TV are flocking to its seemingly endless channels. “They all want to be back in TV because the budgets are high, the production quality is huge,” Sable says.
Of course, someone has to pay for all that content and “advertising has to be as good as the content that you put it around.”
While for many of Y&R’s clients TV “has to be that branded piece, to create the brand image,” more companies beginning to understand that “Amazon is DTC and so is e-commerce.”
With a drive toward direct-to-consumer even in staid consumer packaged-goods categories, there’s more concern now about “how do my ads look different, how do they sound different, what’s the call to action, what’s the offer? What’s the pricing. These have to be in there,” Sable says. “You see it with the Warby Parkers, you see it with the Caspers.”
Even companies like Facebook and Amazon are buying “a ton” of traditional TV. “How come they’re not just on Google or Facebook or Amazon? Because they’re smart.”
Asked about the proceedings at CES, Sable prefers to think of the annual event as more about innovation than technology per se. While he was impressed by a new LG screen that folds up like a window shade, he’d like to see more visibility around 5G cellular service “because so much of what we’ve seen is going to be dependent on 5G.”
This video is part of Beet.TV coverage of CES 2019. The series is sponsored by NBCUniversal. For more coverage, please visit this page.