We were lucky to catch up with Rick Parkhill recently and have shared our conversation below.
Rick, thanks for joining us, excited to have you contributing your stories and insights. We’d love to start by getting your thoughts on what you are seeing as some the biggest trends emerging in your industry
The first-ever TV commercial in the United States aired on July 1, 1941 on WNBC in New York. Bulova Watches was the advertiser and the spot lasted just over a minute. Of course, there were very few people who owned TV sets in the ’40’s. In fact by 1946 there were only 8,000 TVs but by 1960 that number grew to 45.7 million! The Golden Era of TV advertising was born and would grow to become a multi-billion dollar industry creatinging thousands of production, creative, media, sales and agency roles necessary to support the phenomena of video advertising. In 2017, TV ad revenue peaked in the U.S. at around $70 billion and has hit a plateau of around $64 billion for the past few years.
Advertisers and their agencies have been honing their skills for over 80 years, producing video content designed to influence viewers and ultimately drive sales. But TV ads are largely an interruptive media model. Consumers were trained to accept the trade off of their programming being interrupted by commercials in exchange for free programming. It was a value exchange that was just taken for granted….until the internet came along and everything began to change. TV programs began to appear online without ads or the option to skip them. A new generation of “digital natives” were growing up in a media world where they didn’t have to endure commercial interruption. And, then came the streaming platforms. According to Forbes, streaming subscription in the U.S. will exceed $43 billion in 2024 and rise to over $55 billion by 2026. Consumers are speaking with their wallets and letting advertisers know “we don’t like your ads interrupting our programming choices!”
The value exchange of attention for programming is eroding and eroding quickly. From 2017 to 2023, linear TV advertising has been in decline, even while TV networks continue to raise rates. Linear TV ad spend will total $61.31 billion this year, an 8.0% decline YoY, per EMARKETER’s forecast. EMARKETER expects this decline to continue through 2027 (except for small bumps in 2024 and 2026 due to the US presidential election and the Olympics).
Today’s video content consumer is far different from those who tuned in during the “Golden Age” of TV. So, what are advertisers to do when consumers are not only opting to pay for non-interruptive video platforms, but are increasingly annoyed with advertisers that opt to interrupt in any way?
Brands need to produce programming that people will seek rather than interrupt what they have found. This may sound simple, but it’s not. The media industry for decades and generations has honed their business skills on an interruptive model that is being radically disrupted. Media and marketing schools at universities across the country have been slow to embrace change that has been percolating for years and now coming to a boil. MBA programs have been training future marketing executives the old models of reach and frequency and not preparing them for the reality of today, which is brands must become great storytellers!
Big ships are slow to turn. The media industry is a behemoth that now is faced with abrupt circumstances that few either saw coming or decided they would ride out the old model as long as they could because it was comfortable. Think about the thousands of executives whose livlihoods were dependent upon creating and distributing content designed to interrupt. Ad agencies have largely built their wealth by buying media on behalf of their clients and earning commission. Why would these mega advertising businesses ever advise companies to stop buying media when their bottom lines depend upon it? And it’s not just the agencies. It’s the mindset within c-suites amongst executives that are risk averse and there is plenty of risk when driving outside of the lines that have existed for years. Chief Marketing Officers have a short life span. Advocating for investing in programming that intends to inspire, educate, entertain and inform rather than just sell stuff, puts execs and their companies at high risk, especially when that’s a whole new world.
But, times they are a-changing. What seems to happen in the media world is once change begins to happen, the rate it happens increases dramtically. Consider the rush to internet advertising. Online advertising stumbled along for over a decade before advertisers began to shift budgets to digital. The online ad industry had to compete with TV, radio and print, media forms that advertisers and their agencies where expert in. Digital was new and risky. From 2000-2010 online ad revenue grew from $8 billion to $26 billion. But from 2010 to 2020 it spiked to $140 billion and in 2023 surpassed $225 billion while traditional media (TV, print & radio) continue to decline. Once the ball gets rolling, it gains speed fast!
Today, the trend is clear. Brands of all types are recognizing that the old way of communicating is under pressure by the forces driving media choices today. There are “bell cows” amongst the herd of companies who are leading the way to brand storytelling. Just look at Red Bull, a caffienated beverage company that became a media powerhouse, building their own audience with outrageous coverage of stunts and extreme sports. YETI built a powerful brand over the past decade with a constant cadence of short films illuminating outdoor activites and YETI ambassadors. Nike launched a studio, Nike Waffle Iron to create compelling stories of athleticism. Johnson and Johnson produced an award-winning film “5B” that told the inspirational story of hero nurses during the very early days of the AIDS epidemic. Most recently, brands like AB inBev, VLMH, REI, Radio Flyer, Crayola and more have announced brand studios intent on producing entertainment quality programming that will compete with the best content on any screen. And of course, the blockbuster Barbie film got every marketers attention this year with a film that has already grossed over $1.5 billion in worldwide distribution and drove doll sales up 27%.
The path is becoming more clear, but there is a long way to go for significant investment to shift from performance to entertaining media. The CEO and CFO folks need to be convinced that brand-funded films and series have a measurable ROI. Until some acceptable forms of metrics can be established and brands figure out how to connect the dots to attribution, securing budgets for brand programs will slog along. But, that work is underway and undeniably we will see more and more quality storytelling coming from brand organizations. It will be fun to watch!
As always, we appreciate you sharing your insights and we’ve got a few more questions for you, but before we get to all of that can you take a minute to introduce yourself and give our readers some of your back background and context?
In the mid-eighties I bought my first Macintosh computer and started learning how to set type in a program called Pagemaker. Intrigued with the future of communications and media with the advances mainly in telecommunications technology (audiotext and videotext), I launched a newsletter titled “InfoText.” That soon became the first trade publication for media and marketing with a focus on interactive media. Next came the InfoText Tradeshows and the launch of ResponseTV magazine. The media and marketing worlds were moving fast and so were our publications and events. That business was sold in 1992 in Advanstar Communications who sent me to Hong Kong and the U.K to launch similar publishing and event products.
InfoText launched a B2B media career for me that has now spanned three companies that I have founded or co-founded including; Interactive Marketing Inc. (sold to Softbank), iMedia Communications (sold to DMG WorldMedia) and currently BrandStorytelling.
Since the mid-eighties, the evolution of media and its’ impact on marketing has continued to fascinate me. It’s been an amazing and historical time, driven by technology and empowered by creativity. It only gets more thrilling. Not all great, but thrilling. The impact of social media on society and culture has been a two-sided sword and the looming AI future is both exciting and horrifying. We can’t stop the advent of technology, but we have to think about the future because it gets her faster than we think and the ramifications can be fascinating but also devastating.
We’d love to hear about how you met your business partner.
I ran a restaurant in the ski town of Mammoth Lakes in the early ’80’s. Many of the restaurants in town had ski teams that competed fiercely for the coveted “Village Champion” trophy each year. When Mike Pubentz moved to town from Vail, he was emerging as one of the fastest racers in town. I tracked him down on the mountain and offered him a job in the oyster bar. He took that job and we won the trophy that season. Mike and I have bee best friends and business partners since.
Can you share a story from your journey that illustrates your resilience?
When the pandemic hit, we had to quickly cancel our big event at the Sundance Film Festival and convert to virtual screenings and presentations. For two years, BrandStorytelling did not produce an in-person event. We had to learn how to produce online and provide our community with means to connect when they could not do so in person. Through that time, we never missed a payroll, kept our entire team employed and grew our community.
Contact Info:
- Website: https://brandstorytelling.tv
- Linkedin: https://www.linkedin.com/company/brand-storytelling/?viewAsMember=true
- Youtube: https://www.youtube.com/@BrandStorytellingtv
