Why is Malaysia still wedded to the TVC?

The evolution of online video content beyond 30-second TVCs is perhaps the single biggest make-or-break factor in online advertising in Malaysia today.

The past few years have seen all major advertisers increasing their digital ad spends. But this has led to a ‘tick the box’ approach where agencies and marketers merely move budgets from TV to online video pre-rolls. Since a pre-roll is no different from a spot in a TV ad break, advertisers and agencies have felt comfortable with this migration.

But there is a growing realisation that this alone will not magically push up market shares. Let’s think about it. On TV, a consumer can zap to another channel as soon as the ad break starts. Likewise, on YouTube, a consumer can skip the pre-roll after five seconds. Why should we expect consumers to react differently?

So what are the alternatives?

In terms of formats, very few Malaysian advertisers have ventured into new formats such as vertical video, 360 video or virtual reality—all of which have been proven to have higher engagement rates.

It’s the same with duration: most online video advertising still consists of TVCs which the audiences can’t wait to skip after five seconds. In the era of super-short attention spans, why are we not using more short-form formats like Vine, Pinterest Cinematic Pins, Snapchat Mobile Video Ads, Instagram Mobile Video Ads or Instagram Boomerang?

And for amplifying on-the-ground events, how about using Periscope or its lesser-known cousin, Meerkat?

One change which is definitely taking place in Malaysia is the shift from instream video (pre-rolls) to outstream video or native video advertising, namely video advertising which is embedded into a text article or a Facebook newsfeed. According to one global study by Millward Brown, outstream ads consistently outperformed pre-rolls on brand awareness, brand lift and purchase intent metrics.

This will directly impact the revenues of the reigning pre-roll champion, YouTube, while creating huge growth opportunities for Facebook and individual publishers with strong new content and high site traffic.

Programmatic technology allows advertisers to micro-target their audiences by interest and behaviour, and it would be a pity if these laser-targeted audiences all were served the same recycled TV commercial. Instead, the right approach is to use a mix of formats and platforms, each one suitable for a different audience segment and usage behaviour. The days of the ‘one size fits all’ solution are dead.

The second major trend that has shaken up Malaysia since mid-2015 is the introduction of a new measurement system for Pay TV.

The new Kantar DTAM system addresses some of the fundamental shortcomings of the earlier Peoplemeter system. It correctly reflects the 65 percent penetration of Pay TV in Malaysia. It monitors HD channels, which are subscribed to in 50 percent of Astro (Pay TV) homes. In fact, it measures break GRPs in all 150-plus Astro channels, compared to only 24 channels earlier.

The biggest benefit for advertisers is that they can sharply target audiences using specific channel groups, as opposed to the existing ‘spray-and-pray’ approach of using a few high-viewership channels to reach everyone.

The new system shows that TV3 is still the highest viewed channel among Astro homes, but HD channels which were never measured till now emerge as a must-have in media plans.

We have always known that Korean content is big in Malaysia. We now have Korean channel viewership numbers to prove it with One HD leading the way.

Most international channels perform better, including kids’ channels, English movies, lifestyle, infotainment and news channels, while live programmes on local channels are a safe bet in terms of viewership spikes.

Despite these advances, the reality is that it will not be possible for a planner to manually optimise GRPs across more than 150 channels. The likely consequence is that the industry will very quickly move to a programmatic system, just as it has in advanced markets like US and Australia.

Watch this space.

Girish Menon is CEO of GroupM Malaysia