Media Planning and Buying Ad Spend Future of TV

Ofcom’s ad break extension risks ‘alienating’ viewers, warn media execs

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By Hannah Bowler | Journalist

July 4, 2022 | 5 min read

The potential extension of ad breaks on UK TV by Ofcom is short-term thinking that risks “alienating” audiences, according to TV ad execs.

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Ofcom is considering extending ad breaks on UK TV

Ofcom said on Friday (July 1) that it was considering relaxing its rules on the frequency and duration of commercial ad breaks. The regulator claimed the new rules would boost broadcaster revenues and ensure their long-term viability in the streaming age.

Liz Duff, head of commercial and operations at media agency Total Media, acknowledges that Ofcom is acting with good intentions, but says the policy is “short-term thinking.” According to Duff, increasing the volume of ads would replicate the US market, which is “overly cluttered with no stand-out advertising moments.”

“We’ll see lower attention, lower engagement and it may even push viewers away toward the streaming environment – the very outcome Ofcom wants to avoid,” Duff says. Instead, broadcasters need to diversify beyond ad slot revenue, she says, suggesting merchandising and product placement as two potential revenue streams.

The current rules allow the public service commercial broadcasters to air an average of seven minutes of advertising per hour, but this increases to nine minutes for private channels and 12 minutes for teleshopping broadcasts. The rules were last changed in 1991 when the main four broadcasters had 95% of the audiences and Ofcom wanted the newer commercial channels to grow.

Ofcom’s proposal breaks the 60-year implicit contract between viewers and broadcasters, says David Cloudsdale, co-founder of the TV ad platform Adalyser. In regards to content in exchange for adverts, “everyone accepts it, and it is part of the viewing experience. Although it is implicit, it is much better understood and accepted than the user’s relationship with digital advertising,” he says.

Cloudsdale believes the short-term revenue gain will have long-term consequences. “Anyone who has watched commercial TV in other markets knows the grind of ad breaks completely ruins the viewing experience,” he says.

The TV ad market is about to hit a challenging Q4, with the clash of Christmas and the World Cup eating up slots. “Any increase in minutage means better access across this period,” says Rik Moore, managing partner, strategy at The Kite Factory.

More slots also mean cheaper prices, which would benefit advertisers struggling with soaring inflation. Demand for slots for the 16-34 demographic led inflation to hit an eye-watering 90% in Q1 of 2021. Ofcom’s proposal would take pressure off that key 16-34 demographic.

If handled correctly, Moore says the rule change “could be interesting and solve a short-term problem in terms of demand for airtime at key times of the year.” But he warns that an increase in ad slot time must “fit within the context of the programming without disturbing it. Otherwise, we run the risk of alienating viewers and losing them to non-commercial spaces.”

Keen not to push viewers into the hands of the streamers, Ofcom said it would need to strike the right balance and protect audience interests. Before making a decision, Ofcom will be asking the industry and TV viewers for their views.

But not all media execs shot down the proposal. Jon Evans, chief customer officer at System1, suggests it would be “wonderful news for advertisers who care about effectiveness.”

According to Evans, the changes would give advertisers an “extended stage on which to perform, and the opportunity for every advertiser to put on a performance worthy of that stage.” Evans says it’s down to advertisers to make ads audiences want to view, rather than skip. That way audiences would “accept the extra few minutes per hour as a trade-off worth making for access to more programs,” he says.

Michael Nevins, chief marketing officer at Equativ (formerly Smart AdServer), adds that longer and more frequent ads would mitigate the decline in broadcaster revenues. While also offering caution, Nevins says it would “provide more flexibility to public broadcasters [that] will allow them to innovate, which ultimately serves the public.”

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