This is a contributed article by John Martin, chairman and CEO of Turner. Martin is one of the speakers at Code Media, Feb. 12 and 13 in Huntington Beach, Calif.
Our founder, Ted Turner, once said about the cable TV industry, “We dreamed the whole thing up.”
When I became chairman and CEO of Turner in 2014, it was becoming apparent that the world we were living in — and Turner had shaped — was rapidly changing. Consumption habits were changing, traditional distribution was declining, while over-the-top services were steadily increasing and the emerging advertising duopoly of Facebook and Google were creating an entirely new competitive landscape.
It is why we set out on a mission to reimagine TV and to rethink every aspect of how we conduct our business. The goal: To balance the art and science of what we do to create, distribute and deliver premium original content and experiences where, when and how our fans want them.
This requires making tough choices and some big investments in content, talent and technology to adapt to the new market realities. For companies like ours, it is an imperative to be putting our innovation, passion and creativity into new business models and opportunities beyond linear TV. Because the future of television is happening now.
Today, we are operating in an industry that continues to evolve and change at a breakneck pace. This has intensified now that the platform and tech giants are part of the competition, investing billions in content. The most significant impact to consumers and creators alike is that we have evolved from a world of limited options to one of almost infinite choice. And with this overwhelming amount of choice, consumers now gravitate not only toward the most resonant content, but also the most engaging experiences.
Another stark reality is that the advertising industry needs to move with a much greater sense of urgency because we are now competing against non-advertising supported platforms. The “Nielsen only” days are over. There needs to be a swift move to become network agnostic, data agnostic, demographic agnostic and age agnostic. But what keeps me up at night is the thought that by time the industry finally figures this all out, it will be too late.
So, how are we doing?
We have a healthy and successful portfolio of brands that includes Adult Swim, CNN, Cartoon Network, TBS, TNT, truTV and Turner Sports. It is why we had record revenue and profits in 2017. Our portfolio also provides us unique access to a significant and diverse audience as we connect with 80 percent of the adult population and more than 70 percent of millennials every month. This means advertisers have the opportunity to connect with an audience that collectively accounts for more than $4.7 trillion in spending power per year.
Traditionally, media companies have focused only on developing audiences, but it’s no longer enough. That is why at Turner, we are focusing all of our efforts on making fans — the most valuable type of consumer. This shift in approach has changed our focus from maximizing viewership to winning hearts and minds. Fans are more willing to sample new content and spend time and money to interact with their favorite content across a variety of touchpoints, which makes them more valuable to advertisers. And once they are fans, they become amazing brand advocates and evangelists with family, friends and social networks.
It is why our content can now be experienced on platforms like Amazon Fire, Apple TV, Sling and Hulu. We’ve also been launching our own over-the-top services, like FilmStruck and Boomerang, that fill a unique market demand, create more engaging experiences for our fans and create new revenue streams. Later this year, we are also launching a standalone premium sports streaming video service which will leverage Turner Sports properties and Bleacher Report. These efforts enable us to target new fans and bring new offerings to the current landscape.
It was with our advertisers in mind that we have embarked on an effort to reduce ad loads — which also improves overall experience. After becoming the first network to cut its ad load on new programming by almost 50 percent in 2016, truTV is going all-in on smaller, less cluttered ad pods and will transition its entire schedule to the format by 2021. Advertisers appear to approve, because during our Upfronts (2017-2018), truTV experienced nearly 100 percent renewal rates with those advertisers participating in this effort. And our unique partnership with Fox and Viacom on OpenAP is moving the industry toward the ability to standardize data sets so we can all now sell audiences instead of demographics.
Technology is another area where we have dramatically increased our capabilities, and it is a critical component to how we will reach our fans in new, different and innovative ways. That is why we are changing our broadcast technology stack to an IP infrastructure and partnering with Amazon Web Services to migrate content to the cloud.
This will enable us to reach our fans in a more seamless way, whether they are on their mobile phones or iPads, or whether they’re in Seoul, Mexico City, Sao Paulo, London or Dallas. And once complete, we will be able to create custom content, including Spotify-like playlists, that will provide our fans with tailor-made experiences and deliver quality, measurable audiences to our advertisers.
Since 2014, we have been on this singular path of creating and serving fans. And while there is still much we don’t know, we do know that the future art of showing, telling and sharing news, stories and entertainment will put the consumer — our fans — at the heart of the business model. Indeed, they will shape the new narrative of immersive and participative storytelling as much as any technology or creative breakthrough. That is why we will thrive on the other side of all these industry dynamics and shifts, whatever the future of television looks like.
John Martin is chairman and chief executive officer of Turner. He assumed executive leadership of Turner in January 2014; before that, he was chief financial and administrative officer of Time Warner Inc. He began at Time Warner in 1993 as a manager of SEC financial reporting, and spent nearly 12 years at the company ultimately as senior vice president of investor relations. Before joining Time Warner, he was a certified public accountant, working as a senior accountant at Ernst and Young LLP in New York. Reach him @Martin_Turner.
This article originally appeared on Recode.net.