Riche Niches: No Time to Freak Over Media Fragmentation

Just when you thought the cost of television airtime couldn’t climb any higher, thirty-second spots for last Sunday’s Super Bowl XLVI clocked in at a record average of $3.5 million. Although stratospheric, these bucks came with a huge bang, as the NFL anticipated scoring its largest television audience ever with a projected viewership of more than 111 million. While the go-big-or-go-home spend for primetime Super Bowl ads is a top story every February, it’s the NFL’s decision to stream the game live online for the first time that may provide the most interesting subtext from Sunday’s game.

In recent years, the NFL, like many brands, has been aggressive in its efforts to expand globally. By streaming the action online, it will open the door to millions of fans abroad and allow social media to play an even larger role across its viewership. That’s a stark contrast from the days when brands built value by funneling fans’ rapt attention into a single medium. How well the mindshare game is played across different platforms will set the tone for media spends for the rest of the year — and not just for the NFL.

Television remains the simplest way to relay broad content to the masses but digital platforms give consumers more opportunities to explore their far-flung interests while affording brand marketers the chance to meet their customers in these increasingly narrow spaces when they are most engaged and receptive.

These benefits haven’t been lost on retailers, of course, as they also shift away from a broadcast model to one of narrowcasting through personalized mobile marketing, in-store digital networks, hyper-localized assortments and specialized store formats.

As fragmented and niche-y as all of this sounds, things are about to get a whole lot nichier. YouTube is poised to satisfy viewers’ thirst for narrowcast immersion through its “Original Channels” launch this month. At full rollout, this innovative mode of content delivery will push 100 or so micro-affinity content hubs onto the media and marketing scene.

Original Channels was born from parent company Google’s determination to tap into the ad revenue potential of YouTube’s eight hundred million users. That’s a big number, to be sure, but YouTube had reached a point in its evolution in which it was having a hard time attracting advertisers, since much of its studio-generated content was also available on iTunes, Netflix and traditional cable networks, and user-generated contributions were generally a mishmash of hard-to-search, unpolished snippets.

Original Channels marks a major departure from YouTube’s past as it promises to deliver slick, proprietary content developed by leading producers, programmers and talent. Celebrities such as Tony Hawk, Madonna and Amy Poehler have jumped at the chance to create content that is laser targeted to their fans, without the restrictions and costs associated with television or cinema. Major brand marketers including Toyota, Pepsi and Proctor & Gamble are already running ads and, no wonder – unlike the fuzzy ROI forays of social media, YouTube offers brands access to such value-added metrics as viewer searches, purchases, rough locations, viewing histories and social connections.

It remains to be seen whether YouTube and other online entertainment platforms will wick away meaningful primetime audiences, but one thing is for sure: brand loyalty and affinity for mobile and online devices and delivery systems (e.g., iPhone, iPad and YouTube) are growing. They are building stand-alone brand equity that, in turn, brings captive audiences for the content that is constantly streaming to them.

This is no time to be freaked out by fragmentation. There are riche niches to be plundered!

This article originally appeared in the International Licensing Industry Merchandisers' Association (LIMA) blog