LAS VEGAS — CES may have been a tech show and the Interactive Advertising Bureau (IAB) may have been established to advocate digital advertising – but there is a growing school of thought that suggests digital brands need good ‘ol TV, too.

In this video interview with Beet.TV, IAB CEO Randall Rothenberg says he sees an “explosive opportunity for television networks” – the growth in direct-to-consumer brands, many of them wholly digital – which need to gain consumer awareness outside of the hyper-competitive digital environment.

“It’s a very competitive marketplace, they need to break through,”Rothenberg says. “They’ve been very successful in their launch phases, marketing using social networks and some other things.

“But now, in order to be even more competitive, they need to move into main media. And so we’re seeing that over and over and over again. These companies, at a certain point in time (generally, we think it’s around three to five years into their life span), they’re looking at TV and radio, and they’re achieving a lot of success as a result.”

Last year, IAB worked with Dun & Bradstreet to produce research illustrating the trend.

The pair’s IAB 250 Direct Brands To Watch showed two things – first, the extent to which many new brands are foregoing intermediary retail going direct to consumers; second, the extent of competition within that set.

This is a different world because, unlike those which use retailers as intermediaries, brands which have first-party ecommerce data on their own consumers and prospects can take it in to advertising environments.

“That’s one of the interesting hurdles for the television industry in attracting direct brands … first-party relationships realized through first-party data are the core asset of the enterprise,” Rothenberg adds. “So, the challenge (also the opportunity, frankly) for television, for radio, for print is to:

  1. “Show how they can help the direct brands scale by doing effective storytelling to very large audiences that they can also segment very, very finely.”
  2. “Show how that ability to scale transcends whatever gaps they might have in the ability to gather data.”

Rothenberg’s observation was echoed by Video Advertising Bureau, whose own research last year identified 80 new brands – largely, digital and direct-to-consumer – which are now spending $2.6 billion in US TV ads.

To capitalize, IAB’s Rothenberg says television companies must more fully integrate their cable and digital assets, analytic abilities, strategic abilities, understanding of consumers and marketplaces and their expertise at storytelling.

This video is part of Beet.TV coverage of CES 2019.   The series is sponsored by NBCUniversal.  For more coverage, please visit this page

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