Should You Move Your TV Budget to YouTube?

Brandon Welch 0:00
When the goal is to become famous people like me, people choose me. People trust me more than my competitors, the goal is to reach as many people as possible every week, talk to them about something that matters to them, and then let time and your reputation build result from there. You welcome to the Maven Marketing Podcast. Today is Maven Monday. I’m your host, Brandon Welch, and I’m joined by my co host, Friday flannel. Caleb, it’s Monday. It is Monday, but it is Friday in this room, and it is flannel Friday. It is bust out your flannel day. And this is the place where we answer your real life flannel marketing questions to help you eliminate waste and advertising, grow your business and achieve the big dream. And the big dreamers are planning this week. Is that what I

Caleb Agee 0:52
hear? Yes, it is fourth quarter. Fourth quarter. Can you believe it? Fourth quarter? We’re in the the home stretch of the year. So naturally, your brain starts looking at next year and

Brandon Welch 1:05
this year and what you’ve done, and should I do all the same things I did? Should I change something? Yes,

Caleb Agee 1:09
and that’s that’s where we’re we start looking ahead. And we have an awesome question this, this Yeah, this morning, this morning. Can I just probably Tuesday morning, this morning. No, it’s from this week. Actually, we got it and they said, Hey guys, with the election year coming up. Hey, there’s an election year. Next year, there’s an election with the election year coming up. I’m wondering if we should look at moving our TV budget to YouTube for 2024

Brandon Welch 1:38
What are your thoughts? Such a great question, such a relevant question it is. And we give a tiny bit more context in just a second. But this whole thing with election year, if you buy media or advertising, you know, there is a reality to things get noisy. There’s things called political windows, especially on, you know, national election years, and so things can just get inventory can get tight if you don’t know how to buy it, right? So this client is, it’s actually a friend client of ours. Very wise to say that, because that is that can be a thing if you don’t buy media, right? Yep. But a little more background. Tell us about this person that asked us. So

Caleb Agee 2:18
they are a medical clinic in the optometry, Vision category, right? They have five locations around the area. They’re more of a regional they’re not a single location and and they’ve been growing consistently over the last how long they’ve been in business? 25, 30, years longer, longer than that? Yeah, yeah. Very well established company, and they’ve been doing heavy local branding. They’ve been using this TV campaign. They

Brandon Welch 2:45
ramped up the growth speed. Yeah, they started doing, they built an awesome business little by little over the years. And then four or five years ago, they started really investing local and heavy. Yeah, they’ve been doing that for, yeah, four or five years, heavy into local branding. I should say again, yeah, which, so, which makes

Caleb Agee 3:03
them powerful. They’re well known. If you say their name in our area, you’ll people know exactly what you’re talking about and where you’re talking about.

Brandon Welch 3:10
Call that being a household name. And so they’ve, they’ve been achieving and maintaining that status, growing very nicely. It’s a great, great company, yeah. And so it’s a good question. We’re going to break it down how to arrive at the answer, because that’s a relevant question across a lot of media. Should I trade my traditional media dollars for my digital media dollars? And we’re going to challenge that to a higher question, as usual. And I want to say the very first thing we have to start with. And if you have found yourself going, oh, man, that looks fun and flashy and all the quote, sophisticated markets are doing that, the number one thing you should ask is, what is the goal at hand? Yeah, what are we actually trying to make happen? Because this goes to the heart of what plagues the media industry. In the marketing industry, the reason business owners are so disappointed with a lot of their decisions in marketing is because they don’t ask first, what am I trying to make happen? They jump at this shiny object and they think, Oh, I’ll hire some, you know, young nerd to help me with all this stuff. And instead of starting with a really methodical human business equation, we go look for this flash in the pan, shiny object media. Yep. And I got nothing against the media as such, yeah. But what you need to know instead is that every media can drive a different result, and every result requires a different message and media equation, right? Yes. So anytime you’re saying, Should I trade X media for X media? In this case, TV for online video, or TV for YouTube? Is kind of what he was asking. The answer is, it depends. It depends on the goal. Yeah, every media has a different strength. We’ve used them all. We’ve spent gazillions of dollars on TV, radio, digital, Facebook, meta, YouTube, Ott, streaming, billboards, print. We even bought bathroom. Install advertising when that when it called for it. And what I can tell you is all can work, but all are dependent on the result you’re trying to make happen. That’s right. So you know this business. What can you tell me, Mr. Co host, that’s me and your fabulous flannel. Oh, thank you. What do you know about them that they’re trying to make happen?

Caleb Agee 5:19
Okay, so they are not your cheapest. You know, fast fly by night. We think about some of the retail companies, the other retail competitors in this i space. You’ve probably seen their commercials, but here they’re locally known and locally grown. It feels like this is an organic cheesy line. Yeah, no, they’re focused on quality patients, and they have long term, long standing, quality patients. They’re not all about discounts, cheap deals. They’re not trying to get you the cheapest frames, the cheapest lenses, and they focus on your whole eye health, right? A lot of these other places, it’s like, give me my script. I’m gonna go, and then I’m gonna go shop

Brandon Welch 6:05
online, online, buy a cheap set of frames, buy your buy one, get one type stuff. Yes, and

Caleb Agee 6:11
they’re, they’re looking at the quality of it. They also believe in your eye health, which I think is important. They’re doctors. I think it’s, I think it’s important they’re doctors. And I think there’s a lot of power in that they’re not trying to rush you through just throw a script at you and get you some contacts or glasses. They are concerned with is, Are your eyes healthy? Are they? Do you show any signs of disease? Or

Brandon Welch 6:34
how much time do you spend on a computer? Are you a golfer? They have certain lenses for that. They have certain coatings for that. They have certain manufacturers offer

Caleb Agee 6:40
eye therapy. They offer all these different things. And so it’s just a level above kind of your quick in and out. And also

Brandon Welch 6:49
say, the leaders of this company are very benevolent. They’re very involved in the community. They’re very much about a holistic, yeah, if it comes quick, it goes quick. They’re very much about a long standing, you know, pillar of this just most healthy business you

Caleb Agee 7:03
want to be part of. The thing they also you constantly seeing them do is they’ll go out and buy this technology that is just for the patients cutting edge. They could stick with the old technology and stay and stay there at the status quo, but they don’t. They don’t care to do that. They want to give their patients the very, very very best service. And so that’s when they go and pursue that. So,

Brandon Welch 7:24
so very powerful. Yeah, steadfast business, the business we all think of wanting to own. And you think of the companies in this category, and they’re very transactional, buy one, get one today, sort of thing. So I would say the goal for this company, by contrast, and I just happen to know because we’ve been involved with them, is to help people know, like and trust and believe in the quality that they’re wanting to offer long before the sale. Because if you wake up today and go, oh, shoot, my glasses got crunched by my five year old, I gotta run out and get a pair of glasses and all other things being the same, you’re gonna run and try to buy the cheapest thing, right? Or the cheapest, fastest thing, yeah, but what has been the anchor of their branding campaign has been, don’t settle for less than the best. When you go through the moments of your day with slightly cheaper or not perfectly paired lenses or things that don’t fit right, or things that don’t have the right protections and coatings on them, you’re sacrificing quality of life. So if I’ve believed that over these years of getting getting to know them through their advertising and then through the community things they do, I’m going to go, Huh, at this moment of need, I’ve either got a trusted partner and I can call them, they’ve already got my script, or I’m going to, you know, at least consider them before just jumping right into some promotion or discount. That’s right. I That’s right. So it’s not by XYZ for 50% off. And this is important, because this is about the result. This is about what are you trying to make happen? And they say we want people to value us for higher quality, not for the discounts we provide. And that happens to be their goal. And when it comes to buying media, your goal will drive the type of media you need to buy. And there’s two questions we ask when it comes to getting the best deal or choosing the best media. That’s, how many people are we reaching, and what are the qualities of the people that we’re reaching? Um, how big is the audience, and what is the quality of that audience, right? Yeah, um, we measure and the industry that we’re in, like a competent media buyer, will measure the reach of your media by how many 1000s of people you reach. We say, what does it cost us to reach 1000 people, or what’s known as a cost per 1000, or if you’ve ever seen CPM, yep. So we’re going to stay out of nerd territory, but I’m going to give you some very simple third grade math to use, you get the number, like that, CPM number, which is just really the measure of efficiency. It’s like your miles per gallon, if you want to think of it, yes, that’s great. You know, driving in a car, right? So if I put in $1,000 how many people do I reach? Or what is the CPM? And so you. Um, these guys are asking about, should we trade our TV dollars for online video dollars and the CPM, we know to be true, for the TV, the broadcast that they’re buying is $4.86 so what did you $4.86 um, they spend they’re reaching 1000 their ads being seen 1000 times, right? Yep, we just so happened to have millions of dollars of experience in online video. And I pulled like the most parallel case studies and got an average of when we’re showing this. These ads on YouTube, by the way, is the cheapest way to do online video in general, $19.44 do the math, and they’re paying about five, sorry, four to five times more to reach people on online video. And that’s really a best case scenario. Yeah. So for this, I literally pulled two campaigns. One, we spent $50,000 on TV. One, we spent $50,000 on online video, on YouTube, the TV ads for that $50,000 investment, we’re seeing 10,286,000 times. And the YouTube ads were seen 2,500,000 times, literally, like, almost, you know, a little more than four times as much, yep. So, on a good day, on a great day, you’re reaching a fourth of the people on online video? Yeah, okay, most online video is going to be more like a 50 to $60 CPM you’re talking about, OTT. A lot of people ask about, should I be on Hulu? A lot of people ask, you know, should I go to this really fancy streaming service my cable rep is offering me, and it sounds really, really cool, because they’re like, we can reach a 42 year old mom with, you know, yeah, two kids in the house, a golden retriever, and she likes yoga, yeah? And you’re going, that’s awesome. But then when you realize what you’re paying for it, you’re paying like, you know, 1015, 20 times, times, you know, more, to reach that person, yeah. And so you go back to the goal, How crucial is it for me to reach the mom of the Golden tree for or if I just reach her and a group of her friends and her family and I become famous in my town or my region, that is often driving the result that most brick and mortar and regional companies want to work with or want want to have, yeah,

That is, that’s the basic math, you’re probably reaching a really small fraction of the people when you take a broadcast media and try to put it in a digital media instead, yeah, simply because the market charges so much more than that for the record, for all of my digital wizards that are listening right now, I do think in time, that will change. I think digital media will get cheaper, and I think the audiences are continuing to get bigger, but I see for the next five to 10 years, that’s probably still the case, yeah. And, and if your goal is to become famous and have people choose you before they go searching and looking for you, online broadcast is a better investment in most cases. Yeah.

Caleb Agee 12:57
And that’s, that’s the approach most people when they ask us a question like this, should I go OTT? Should I go YouTube? A lot of times it’s in the name of that targeting, reaching that very, very specific person. I sell a home improvement service, so I only want home owners. I don’t want renters. There are different things like that, and usually in the name of targeting, and and in any media, on Facebook, on YouTube, any place you go, the more targeting you apply, the higher your CPMs get, and that, that is where you end up costing yourself. Yes, you get, in this case, we’re talking about, you know, $5 against $20 for x. But if you start adding homeowners, if you start adding women, if you start adding all of these very specific graphic areas, you’re you’re gonna get up in the $40 range. And you’re talking about 10 times the cost to reach those same people. And at

Brandon Welch 13:51
a local level, it’s just extremely expensive. Yeah, and you say so, so we tend to think that, oh, this magic person I reached, the perfect person. That’s what makes the ad work. And I’ve got to tell you, you are, quote, the perfect person for like, 1000s of dollars worth of ads that get shown to you in a week. Yeah. And has that made you buy? Not necessarily.

Caleb Agee 14:13
And, and I don’t live in a vacuum, you know, if, if you’re the perfect person, but I’m not. Yes, the truth is, you’re still going to ask my opinion when you when you need a service, right? Hey, yes, I need an electrician. Do you know a guy? Yeah, I’ve got a guy. I don’t even know. You know I’m saying that I wasn’t the right target, but I didn’t live in a vacuum, and neither did you.

Brandon Welch 14:35
So the most profitable goal for most businesses certainly service businesses, and certainly businesses that have a long term buying cycle and big ticket items, the most profitable goal is, what is the word on the street about you? Yes, what do people think and feel long before they have this super targeted, super, quote, unquote, perfect time to need you and buy you and click and just look at your own life. Life like, look at your own life and how you buy you don’t go, in most cases, or things like doctors, for things like roofers, for things like HVAC, for things like attorneys, you don’t go, Holy smokes. That’s a perfect ad. I’m gonna click on it and buy that now. Yeah, the need arises, and when the need arises at that point, it’s what has happened to you up until that point that really makes the difference, yep. And competitively, if you’re the one that has done that, well, you’re the one that wins. If you’re the one that has not done that, well, you were left to chance, and you are a result on a search engine page. And it comes down to price, convenience and hassle, and how much are you going to discount, how fast you’re going to deliver me the service, and how close are you to my house? Yep. And how quick can you get me in? Not your favorite customer, not your favorite customer. Those are the customers that are looking for

Caleb Agee 15:47
a rip off, cheap and easy. They’re looking

Brandon Welch 15:49
to rip you off in a way, and get it as cheap as they possibly can. So the math says broadcast wins the media equation by a lot, the reach equation. And let’s talk about that second one, the quality of the people. It does matter in certain cases. Um, let’s talk about this mom who has a golden retriever, two kids, and does yoga. Um, there’s a time where there’s a perfect product that only applies to her, and this is probably going to be more in the E comm world, there’s a perfect offer that’s going to apply to her. If you are outside of a local territory and your your audience is so specific, think mountain bikers, enthusiast

Caleb Agee 16:33
type of brands for sure.

Brandon Welch 16:36
Think, yeah, enthusiasts of, you know, owners of Taylor acoustic guitars, or, you know, fans of Led Zeppelin or, yeah, some really weird band, right? Yeah, your, your, your audience is probably too small to exist in, like, really small pockets, like a city. So you are thinking more about nationwide targeting, and if you’re delivering your service or product online, that is where digital targeting starts to become a thing. Yes. And I will say that the wider you go, when you’re buying nationwide, the CPMs do get a little bit cheaper. So that efficiency equation isn’t still as near as good as broadcast, but it’s a little better than if you’re trying to cram that in, like a, you know, yeah, even a city the size of Atlanta, right? Yeah. So if you’ve got a specific offer, a specific discount, a promotion, something I can click, what we would call direct response, um, which we do a lot of, even for this client, yeah, we take a certain part of their budget and we put it into that direct response thing. We have some really specific like products for kids, for them. There is a time and a place to do that, but by and large, win the goal. Going back to strategy, strategy first, where we try to make happen. When the goal is to become famous people like me. People choose me. People trust me more than my competitors. The goal is to reach as many people as possible every week, talk to them about something that matters to them, and then let time and your reputation build result from there

Caleb Agee 18:02
and that, that’s something we’ve seen with you, said every week, and I think that’s an important frequency is a really important factor inside of this is on YouTube, especially if I have a wider audience, even if I’m even if I’m just targeting my local Geo, yeah, let’s just say, for This client, we just wanted to get on YouTube and target the same area that TV would cover. Yeah, the issue is, I’m not necessarily going to reach the same people every week. So important. So there are, how many, how many people in our DMA here, roughly a million, a million, a million. So I’ve got, I’m reaching a million people inside of this, this target? Well, the truth is, I don’t want to reach all of them one time. Yes, I want to reach a select set of them over and over and over and over again every single week. Yes. And so I Roy Williams is, you know, famous around here for saying, Would you rather reach, you know, 100 or convince? Sorry, would you rather convince 100% of the population 10% of the way? Or would you rather convince 10% of the population 100% of the way?

Brandon Welch 19:09
That’s what it’s all about. These, these broadcast audiences, even though they’re big, a very key mechanism, if you’re buying your media right, is showing up in the same programs and the same frequency, by the way, big part of the growth that’s happened in this equation for this, you know, person we’re talking about, um, has come from a very couple select set of programs that we said we’re going to make you famous with this 60,000 audience, yeah, and that 60,000 person, audience, over a year’s Time, you know, is exposed to these messages probably 50 times a piece per person. Like, there’s not, probably a person in that audience that hasn’t seen this company at least 50 times, yeah. And so they’re, they’re convinced that 100% of the way, and we’re just waiting for that moment when they go, Oh, yep, it is time to do something with my vision, or my kids vision, or my mom’s vision, yep. Or my. Aunt’s vision, or my sister’s vision, or my co workers vision when they ask me about it, right? And so you’re becoming famous in a set of audiences, and YouTube, all digital media make that extremely hard. The platform itself, the way impressions are delivered is not like people are coming to the same program over and over, yeah, the way they’re delivered is at random, whenever the algorithm decides to throw them in there, when they have room for it. Essentially, yes. So you might see it once today, it might be two months before you see it again. Yeah,

Caleb Agee 20:28
and, and you can measure frequency, in fairness, on YouTube, on Yes, Ott, Hulu, those kinds of things, you can measure that frequency, that repeat rate, for the customer, because we want the customer to not see our ad one time. We want to see it over and over. We try to get at least three times in seven nights sleep. And we can’t guarantee that on YouTube, but we can reasonably guarantee that if we’re buying some sort of TV program that’s consistent. So

Brandon Welch 20:56
so same basic area, the YouTube factor I just gave you. You know what the case study said? When I look back, this is a real campaign we ran by, yeah, we spent $50,000 of a client’s money, who, by the way, was fully on board with it being an experiment. And they knew all these things we were telling them, like, we want to try it anyway.

Caleb Agee 21:14
This is the one where it cost four times as much. Yes, two, yep. But very

Brandon Welch 21:18
similar area, same thing going on. You know what the average frequency was like? 2.2 Wow in six months time. Wow. And on TV that would have been 20 to 30 in six months

Caleb Agee 21:32
time. Yeah. So the average person of those of that viewership, yes, only saw their ad two point

Brandon Welch 21:40
by the way, this is the even scarier metric. 87% of them skipped the ad and didn’t watch it, and that’s a real thing with online video, I’m not saying it’s useless. We do use it, but in a intrusive broadcast environment, somebody has to sit there and at least hear or see the ad if they’re watching the program, which, by the way, is also measured by Nielsen and com score

Caleb Agee 22:02
and and if you’re placing TV, in this case, you’re measuring it, you’re watching it, you can prove that that ad ran to its full extent 30 seconds, 15 seconds, 60 seconds, whatever you’re running, that it ran within the window the program that you bought it is all proven and all true, and only

Brandon Welch 22:20
13% of the time. In this other YouTube case study, did the ad run 100% of the time before somebody clicked off on it. And so effectively, if you want to really look at the CPM of people watching the ad, 100% of the time on TV, it was still that $4.86 on YouTube. It was $149.57

Caleb Agee 22:40
that would have watched the whole 32nd ad or been exposed to the full AD? Yep.

Brandon Welch 22:45
Wow. And so I know there are some, man, there are some. We’ve made some nerds really mad right now because they’re going, they’re about to throw darts. They’re saying, dude, don’t, you know, broadcast has lost half of its audience. And don’t, you know, online video takes up half, you know, half the all streaming. Couple things, we are going to talk about that in a few weeks, about, um, what’s actually going on in the media industry? Not I’m the first one to tell you, broadcast has deteriorated. The most recent study I looked in the last couple of years, 5% broadcast audience has gone away. Most of the cable audience is what’s fragmented. Just so you know, yeah, cable. Think about cable and satellite and the old school way of, you know, streaming or watching, you know, that type of programming broadcast your local channels, specifically in news and specifically in things that people can’t get anywhere else. Those are still holding strong, and they’re a bargain, because you can reach so many people if you’re on a local basis. And so that’s largely who we serve. Small business owners that have a regional presence, or, you know, a strong local presence. And it’s not the end all be. All the media does not is not the only thing that makes you successful, but when it comes time to become a company of impact and a company people have heard of the leverage and the amount of people you reach and the intrusiveness of that messaging is just so much stronger than the digital world can currently deliver for the same amount of money.

Caleb Agee 24:09
Yeah. So I’m going to throw a question at you that we did not have planned. Ooh, but we’ve, we’ve been talking about this a little bit more. The question was actually originally from this company. They were asking about an election year next year. We’ve talked about the value of planning out your broadcast schedule prior to the election year. Where does that show up? How is that powerful?

Brandon Welch 24:36
I’m a procrastinator, usually, and most people are procrastinators on this uh huh. I plan to stop procrastinating next year. That’s just plan funny. Okay, so planning out, yeah. So we’re currently sitting in fourth quarter of 2023, and the thing you need to be thinking about is get your orders in for your broadcast media now. Start negotiating now, because the way the industry works, first of all, you’re going to get the best deal if you plan annually, yep. And in most cases, there is still room for adjusting later. But if you’re saying, Mr. You know station manager, I want to commit to you this amount of money, I think this is going to be in line with my reach and frequency goals. I think my business could sustain this. We’re in growth mode, or we’re just, we’re maintaining our brand. I’m going to commit this stack of money to you in October, November, and I’m not going to wait till the spring to see kind of, sort of how the holidays went. I’m going to say, Nope. I’m thinking full wide ahead. I’m going to give you an annual plan. You will get better treatment even next November, because you were the first person in their system. And the way this works is that by securing your buy now, you are sort of one of the first people in the buy. And when these big politicians come and say, kick the local advertisers out, I’ll pay two or three times more. You’re just lower down the list, it can still happen, yeah, especially that first or that, you know, last really aggressive weeks leading up to election times, but it’s way, way less likely. And I’ll add that if you’ve been consistent all year a couple of weeks of disruption in your messaging, it’s probably not the end of the world, and you usually can negotiate a better deal for those spots that you get kicked out on because the station does feel bad, and they do want to honor your business, and they just still want to keep that want to keep that relationship? So they’ll after the, you know, after the big spots run, they’ll give you a better deal to put that back in the mix, or at least a really fair deal, so you might even get more for your money. Yeah? So I that’s a really great question. Yeah, plan now, commit annually. Don’t think small. Think what do I want to have happen? I’m going in I’m a strong business. I’m going to act strong the economy and the headwinds and the politicians are throwing junk everywhere, but I’m not going to get caught up in that. I’m going to show up for my people with a good message of optimism and stand on my quality and my values. And I’m a company that believes in you and doing business for you and doing business with you, and this is the way we do it. If you are the one being consistent right now, you will come out so much stronger out of this season of doubt, and you will be the strong brand. And you’re not just gonna grow as much as you would have. You’ll steal market share while of your other competitors were weak, while all of your other competitors were staying home while all of your other competitors were pulling their chips off the table and making small minded decisions. You’re the strong one, you’re the preferred one, and you are the one that’s going to be here in what we call legendary business status. Love it. So use online video when it’s appropriate, when you need the targeting. We have a product that has a direct response mechanism or an otherwise really strong need for targeting. But if you are trying to be a legacy, strongly branded business, use the media that’s going to deliver the most amount of people for the least amount of money, as long as you can commit to doing it consistently.

Caleb Agee 27:58
Awesome. Hey, before we get going, if you haven’t picked up a copy of Brandon’s book, the Maven marketer, you can do that on Amazon

Brandon Welch 28:07
and and the hardback and audiobook will be released this week. Wow, you heard

Caleb Agee 28:13
it here first. So you can also, I will send you a free signed copy by the author. I will personally pin him down. I like that feeling. Yeah, okay. I thought you that’s, that’s your kind of joke, I think. And we’ll get you a copy if you send us a question, send us if you’re going to commit to that annual TV schedule next year. Send us your ad. We’ll review it on the on the podcast, send us your schedule. We’ll we’ll review it. If we could review it in silence. If you don’t want it out in the open, all you have to do is send an email to Maven Monday at Frank and maven.com you can sign up for our regular emails. We send two a week. You can sign up for those at Frank and maven.com anytime you want encouragement, uh, you’ll get notes from these, these, uh, videos. It’s all powerful stuff. We’re

Brandon Welch 29:06
working hard for you guys. 2024 is going to be a great year, despite what they’re trying to tell you. If you enjoyed this, please hit the subscribe button. Share it with somebody, forward it with somebody, to somebody that you love, like or otherwise want to do well and send your questions to Maven Monday at frankon, maven.com We’ll be back here every Monday answering your real life marketing questions because marketers who can’t teach you why are just a fancy lie. Have a great week.