Premion's Tom Cox On How Local Broadcasters Are Embracing the Shift To Streaming

This is the first of five Innovator Spotlight articles from our newest TVREV Special Report, Local TV: Perils & Promise in the Age of Streaming, which you can download free.

“In the US, adults are spending nearly five hours a day watching TV and almost 40% of that is through streaming nowadays*. So, broadcasters have really jumped on board with the streaming trend out of necessity,” notes Tom Cox, President of Premion. “They've found different ways to adapt their content and business models to fit the streaming world.” 

ALAN WOLK (AW):  How are local broadcasters currently embracing streaming and what does that look like in practice?

TOM COX (TC): Local broadcasters are developing new ad solutions and streaming products to address the streaming shift and they are uniquely positioned to deliver local demand as they have the established, in-market local sales forces and strong advertiser relationships. This gives them a significant edge in capturing the shifting ad dollars towards streaming.

As local broadcasters continue to invest in their convergent linear + streaming selling capabilities, they can compete more effectively against cable, which is being continually impacted by cord-cutting. Today, nearly 40% of US households can only be reached through streaming TV**. So, advertisers need to incorporate streaming into their advertising mix as part of a complete TV strategy.

Additionally, these streaming advertising solutions are not constrained by traditional linear limitations, such as ratings.

Notably, some local broadcasters are investing more in distributing highly valued news content on streaming platforms, including licensing their content on other platforms.

AW:  Explain to me what Premion is and where it fits into the local advertising ecosystem

TC: TEGNA saw the emergence of ad supported streaming early and incubated Premion in 2016. Our business model revolves around partnering with top-tier premium brands and leveraging our targeting and attribution capabilities to deliver compelling, locally-focused streaming advertising solutions. In terms of what sets Premion apart, it's really three things: our footprint, our local focus from a product and technology perspective, and the fact that our origins are in broadcast. And because of that, we're able to sell a converged linear + streaming ad product.

Through our relationships with TEGNA-owned stations and our partner Gray’s stations, which, combined, reach about 80% of US households, we tap into their established business connections to effectively serve local advertisers.

Our product and technology stacks are designed with a local-first mindset. This entails a higher level of challenges but allows us to provide tailored solutions on a local scale. We have successfully executed nearly 18,000 campaigns for 1,500 auto advertisers and over 3,000 campaigns for 700 retail advertisers. More importantly, our scale has afforded us the opportunity to amass expertise in effectively addressing specific campaign objectives across various verticals.

Consider the scenario of a car dealer that’s looking to drive more sales of SUV inventory. This differs from the goals of a furniture retailer focused on driving website sales. Each scenario requires different tactics, and our expertise and capabilities that we’ve built over time enable us to help our advertisers achieve their specific goals with efficacy. 

AW: What is keeping local advertisers up at night?

TC:  Businesses are still grappling with economic uncertainty and the changes brought about by the pandemic. Many business owners are facing challenges in deciding how and where to market their offerings and how much they should allocate to advertising. Moreover, the sheer number of available choices overwhelms many of them. That's why a significant portion of our time is spent on educating advertisers about the opportunities and capabilities in the local market, which is where Premion sets itself apart. 

AW:  How have you observed the attitudes of advertisers towards streaming evolve over the past five years or since you started?

TC: We've been in business with Premion for more than six years now and it’s been quite a journey. We've witnessed a lot of change and evolution in this space. The early adopters were mostly national advertisers who saw the potential early on. In the early days of streaming, premium inventory wasn’t always readily available.  So, when Premion first started, we made it our priority to ensure that we were sourcing high-quality inventory — and we built our business with premium inventory as a hallmark of Premion. And over time, the demands around what we could do got more sophisticated – and advertisers were seeking more advanced targeting, attribution and measurement capabilities.

Notably, local really came into the game after the pandemic started. With consumers at home, they started streaming more content — including small business owners. In turn, the acceleration of this consumer experience prompted local businesses to recognize the necessity to advertise on streaming platforms. And now we're at a place where there's a huge number of providers and new entrants in the CTV space. This underscores the importance for advertisers to vet and work with a trusted CTV provider — one that has a proven track record, data-driven capabilities, and extensive experience.

AW: How much of a windfall can local broadcasters expect to see from the 2024 election, especially in terms of spending from down ballot races?

TC:  Earlier this year, we conducted a Campaigns & Elections survey, in which 70% of political advertisers expressed their intention to allocate more of their budgets to streaming for this cycle. In the previous cycle, streaming accounted for approximately 12% of all political advertising, which is just slightly over a billion dollars.

We anticipate significant increases in both overall political spending and the share allocated to CTV. To answer your question more directly, the precise targeting capabilities of CTV will incentivize more political agencies to direct their business towards CTV. Additionally, we believe there are at least eight key states that will play a crucial role in determining a number of races in the 2024 elections. Within these states, the majority of local markets are expected to witness an unprecedented demand for TV ads – both linear and CTV.

AW: As a guy who really has his ear to the ground on all this, what does the future of local look like? What are some of the trends we should be looking at over the next few years.

TC:  If you're asking me to pontificate on what the future looks like, there are a couple of key trends that we're closely monitoring. First, advertisers will increasingly recognize the value of co-viewing on CTV, which allows for a more direct comparison with traditional linear TV. Additionally, I anticipate a rise in localization and personalization efforts through the use of dynamic creative, as an example. Whether it's embedding a scannable QR code or adding an inventory scroll to a CTV ad, the ability to deliver a more localized and personalized ad experience is becoming more accessible, and I believe this trend will continue to gain momentum.

I also expect to see a greater adoption of outcome-based tools, such as attribution or brand lift measurements, as well as other emerging products. In fact, we recently introduced sales conversion attribution for local markets, and we anticipate that buyers will continue to seek ways to understand the effectiveness of their ad spend through attribution and measurement. 

Lastly, we foresee ongoing investments in preferred buyer workflows and self-service options, both of which are part of Premion's roadmap.

AW: Give me one final pearl that readers can take away with them.

TC: Simplification and aggregation are going to be a big part of the CTV landscape and so advertisers will need to seek out partners who can aggregate across all the various streaming services if they want to secure enough reach for any particular campaign.

*Source: eMarketer; Average Time Spent per Day with TV, US, 2023, June 2023; eMarketer; eMarketer, Average Time Spent per Day with Connected TV, US, 2023 June 2023. Copyright © 2023 Insider Intelligence Inc. All Rights Reserved.

** Source: © MRI-Simmons 2023. 2023 March Cord Evolution. The data herein derives from a confidential, proprietary syndicated product owned by GfK US MRI, LLC.