Advertisers and media buyers should not devote too much of their budgets to digital advertising despite the rush of marketing dollars into online advertising, GroupM chief investment officer Sebastian Rennie warns.
Mr Rennie called on advertisers to remember the important role that traditional media such as television play in their campaigns.
"It's important that we find ways to introduce digital into the overall screen mix, because there's definitely viewing happening there and it's happening in increasing numbers each year, but I think you've also got to be careful that you don't tip the balance too far," Mr Rennie told Fairfax Media.
"There's no question TV still remains a lead media channel for us as an agency, but also for our advertisers and clients too."
GroupM, Australia's biggest media buying firm, is responsible for $2.84 billion in advertising billings across its agencies, including Mindshare, MEC, MediaCom and Maxus, and is part of advertising mogul Martin Sorrell's WPP.
Clients and agencies need to strike an optimal balance between what they spend on linear TV versus digital video said Mr Rennie, who started as CIO at GroupM in May after seven years at one of its agencies, MEC.
"Broadly speaking, clients are more and more focused on delivering good results and growth; working out the best medium mix in order to do that is a constantly evolving challenge. We're in an age of constant volatility and change."
Mr Rennie said he was expecting some big news from the free-to-air broadcasters on how they are going to integrate their content across platforms when they showcase their shows for the year ahead to advertisers and media buyers at the annual "upfronts" in the coming month.
"I think the audience pressure that the free-to-air networks have seen this year has been fairly well covered, so I think it's a good opportunity for the networks to show how they're addressing those audience challenges and the challenges they're facing around the distribution of content."
Mr Rennie said digital and out-of-home advertising have been big areas of growth for GroupM.
"I think out-of-home is having a bit of resurgence at the moment; there's a lot of interest in the medium. As an overall channel, they're doing a lot of work in terms of digitising their inventory and that's creating new opportunities for advertisers and setting up the ground work for consumers being able to interact with outdoor, which could potentially become the shopfront of the future."
Third annual mLab exhibition
GroupM held its third annual mLab exhibition in Sydney last week where different media companies such as Instagram, Adshel and Fairfax Media, owner of The Australian Financial Review, showed GroupM clients how new technologies can be used to connect with audiences and run compelling campaigns.
"I think mLab has been really great because it's an opportunity for our clients to stop and take stock on what's changing in the world around them – that's been reflected in a lot of the feedback from clients who've been excited about some of the more futuristic stuff and they can see the utility there, but they've also been excited by some of the stuff that's a little closer the here and now," Mr Rennie said.
Last year at the Google's Brandcast event, the search engine unveiled an exclusive deal with GroupM to take YouTube's top 5 per cent of premium ad inventory for 12 months. The contract has resulted in 30 blue chip advertisers in GroupM's portfolio using the premium ads and is estimated to be worth between $15 million and $30 million.
Mr Rennie said the deal has gone quite well and GroupM is considering internally whether to renew.
Mr Sorrell, who is chief executive of WPP, told The Newspaper Works Future Forum last month that GroupM is pushing aggressively to get a measurement of video viewership that extends across seven days on all screens because measurement standards on digital video, particularly Facebook, were "ludicrous" when being measured against traditional TV.
Facebook defines a video view as a view of three seconds or more. "That, I would say, is ludicrous in relation to the hurdles that a traditional TV viewer, or newspaper readership, has to meet," Mr Sorrell said.
"Measurement standards have to be raised, particularly for online. The pendulum is moving back, in some respects, not all respects, to traditional media and giving them a little bit of a boost and potential advantage."
The Australian TV sector is working on a new measurement standard with OzTam to encompass viewing across platforms to including things like catch-up services.
"What's important for the industry . . . is that we don't splinter the measurement, because TV is a big part of what we do and it still commands a high share of the overall advertising dollar," Mr Rennie said.
"It's important to have a common currency across that kind of media channel; hopefully the work that OzTam are doing will provide the market with that comfort and extra visibility to where the audience is, but also keep us all working on the same platform."
