The Internet that was expected to out-finesse TV is actually depending on it. That's the implication of “What’s Driving Digital,” a new study of Nielsen Ad Views data that indicates TV is the primary driver of traffic to websites, and the more a site advertises on TV the more money it makes. The study, conducted by the Cabletelevision Advertising Bureau (CAB), helps explain Internet giants’ increasing investment in TV, and is the latest report to call into question a media attribution system that overemphasizes the last site visited or last touch in the messaging chain.
The 75 largest pure-play Internet brands spent more than $4 billion on TV ads in 2013, an increase of 37% over 2009. And 85% of them show a direct correlation between TV spending and website traffic. The 38 advertisers that spent more averaged 33% more unique visitors, while the 25 advertisers that spent less averaged 22% fewer uniques. For example, Priceline cut TV spending 26% during the period, and wound up with 24% fewer unique visitors; whereas Ancestry.com upped spending 22% and gained a 21% increase in uniques.
“TV is the biggest driver of customer traffic into U.S. sales channels, and that clearly includes the Internet,” said CAB president Sean Cunningham. “The study reveals that Internet pure-play brands are largely dependent on TV for traffic and for revenue. That’s the direct effect of tremendous commitment that audiences have to TV content, and the actions that predictably turn viewers into customers.”
The study also examined Website brands in 12 categories – financial, streaming video, retail, auto, travel, ecommerce/auction, dating, home, computer software, Internet services and caregiving/health – for any correlation between increased TV spending and company revenues. In total, the 12 companies studied increased their TV ad spending from $167M to $679M and their revenue-per-TV-dollar-spent leapt from $11.06 to $46.26 in 2013, the last full year analyzed. For example:
- 14 years ago Priceline spent $35M on TV and made $1.2B for a $35.21 per-dollar total; last year the company spent $102M on TV and made $6.8B for a $66.80 per-dollar total.
- Over 11 years Overstock.com has upped its TV advertising from $8M to over $22M, and seen its revenue per TV dollar soar, from $29.22 to $57.30.
The full report is available here: http://www.thecab.tv/pdf/Whats-Driving-Digital-Report-FINAL.pdf
About CAB
Founded in 1980, the Cabletelevision Advertising Bureau (www.thecab.tv) is a television advertising advocacy group dedicated to providing advertisers and their agencies with the most current, complete and actionable media insights at the national, DMA and local levels.
Contacts:
Fred Pfaff, 917-902-6883
