APRIL 2018

TABLE OF CONTENTS

Page

Executive Summary 3

Overview 3

POPULARITY OF OUTDOOR ACTIVITIES 4

TELEVISION VIEWING HABITS 5

Traditional TV Viewing 5

Cord Cutters and Cord Nevers 7

Who Owns What: Media Device by Generation 9

Millennials and Streaming Video 10

Millennials and Digital Video 10

Millennials and Web Connectivity 10

Millennials and Social Media 11

ECONOMICS 12

Millennials: Living Arrangements & Dollars 12

Fewer Millennials are Household Heads 12

Millennials and College Debt 14

Median Income by Age Group 14

Median Net Worth by Age Group 15

Millennials and The Shared Economy 16

Millennials: Ethnic Diversity 16

MEDIA TRUST AND INFLUENCE 17

Power of Television Advertising 17

A Few Issues with Digital Media 18

Millennials and Other Media Usage 20

Finding the Right Media Mix 20

Conclusion 21

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 Executive Summary

Hunting and fishing remains a popular activity, especially with older adults and higher income
households, they are also heavier viewers of television. Millennials (born between 1982-2000) are light
viewers of traditional television and nowadays, with a proliferation of screens and platforms, are
watching even less television. Among adults, Millennials have the lowest net worth. Because of student
loans, millions of Millennials are coming into adulthood, in debt, and as a result, putting off traditional
milestones such as marriage and buying a home. There are strong indications however, that as
Millennials get older and settle down, they will watch more television. Television is the preeminent
advertising medium to build brand awareness and trust. Television is also the ideal medium to reach
persons who hunt and fish. This report provides an overview on their finances as well as their television
and digital usage, of Millennials, Generation X and Baby Boomers.

Overview

Persons who are more likely to enjoy outdoor activities such as fishing and hunting, tend to be
wealthier, older and heavier viewers of television.

Millennials account for one-fourth of the U.S. population, surpassing Baby Boomers as the largest
generation in the country. Virtually every Millennial will be eligible to vote this year and have been
graduating from college in record numbers. Millennials have grown up with a series of indelible events
and rapid change, including; the terrorist attacks of 9/11, the ongoing wars in Afghanistan and Iraq, the
Great Recession and the emergence of digital technology into everyday life.

Millennials are the most educated generation to date, but that has come with a cost; debt from college
loans. As a result, many Millennials have forestalled familiar milestones when entering adulthood, such
as buying a house, getting married and becoming a parent. Millennials have created what Goldman
Sachs calls “the renter generation, they are far more likely to rent (instead of own) a house, a car and
other “big ticket” items.

The search for lower cost alternatives are also prevalent with media and entertainment. Millennials, are
digital natives and lighter viewers of television. Many have opted to “cut the cord” and subscribe to less
expensive alternatives such as steaming video services, a la carte TV and “skinny bundles” from virtual
MVPD’s. Millennials are also far more likely than older adults to embrace digital platforms, such as social
media. As Millennials get older, get married, buy a home and have children, their media habits become
more in line with older adults, they watch more television and subscribe to a pay TV service.

Despite digital alternatives, television continues to be the best medium for building awareness and
reaching consumers. Research studies point out the best marketing strategy for an advertiser’s ROI,
includes a combination of television with digital media.

How Many and How Old are Millennials, Generation X & Baby Boomers?

There are various definitions of generations, one of the more common is below with the population:

Millennials were born between 1982-2000 with a population of 84 million

Generation X were born between 1965-1981 with a population of 65.6 million
Baby Boomers were born between 1946-1964 with a population of 74.1 million

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 THE POPULARITY OF OUTDOOR ACTIVITIES

In September 2017, the U.S. Department of Interior issued a report from the U.S. Fish and Wildlife
Service. The report found 101.6 million Americans, or 40% of the population age 16 and older, had taken
part in a wildlife related activity such as hunting, fishing or wildlife watching in 2016. This highlighted the
continued and growing popularity of Americans engaging with outdoor life. These activities are also an
economic powerhouse, according to the report, these participants spent $156 billion in 2016 on these
pastimes, the most in the last 25 years (adjusted for inflation).

Participating in outdoor activities such as hunting and fishing are popular for a number of reasons, its
quality time with family and friends (or solitude), it’s getting outdoors, provides a form of exercise and
it’s a form of relaxation.

According to the National Survey of Fishing, Hunting and Wildlife Association, persons who hunt and fish
share similar demographic and marketing characteristics. Both activities tend to skew toward adults age
35 and older. Furthermore, since the cost for these activities involved can be expensive (purchasing
equipment, trips, licenses, etc.), persons who hunt and fish are more likely to have a higher income.
According the United States Fish and Wildlife Service, the average annual expenditure for an angler is
$1,262. For hunters, the average annual cost is nearly double at $2,484. [Chart 1]

Other characteristics of persons who hunt and fish tend to be male, white and have attended or
graduated from college. As we will see, television is the best medium to reach those who hunt, fish and
enjoy outdoor activities.

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 TELEVISION VIEWING HABITS

Traditional Television Viewing

Young adults have historically been lighter viewers of television than older adults. Nowadays, with a
greater amount of content becoming available on other screens and platforms, adults age 18 to 34 are
watching even less traditional television when compared to previous generations of young adults.
Millennials are early adopters of new technology and have often been described as “agents of change”,
for bringing new technology devices into households.

According to Nielsen’s Competitive Metrics Report for second quarter 2017, adults age 18 to 34 watched
only 2.3 hours of live/time shifted television every day. This figure is significantly lower than both adults
age 35 to 49 (3.9 hours daily) and adults age 50 and older (6.2 hours daily). Hence, older adults watch
more than twice the amount of television/time shifted viewing, than younger adults each day.
Conversely, adults age 18 to 34 spend significantly more time using connected TV devices such as Roku,
Chromecast that streams video content onto the television screen than adults age 50 and older. The
Competitive Metrics Report also points out adults age 18 to 34 spend only 26% of their total media time
with Live TV/DVR playback. By comparison, adults age 50 and older spend 52% of their total time with
Live TV/DVR playback. [Chart 2]

As television usage drops with young adults so does weekly reach. According to Nielsen, television
reaches only 78% of adults age 18 to 34 each week. By comparison, television’s weekly reach is
considerably higher for adults age 35 to 49 at 90% and adults age 50 and older at 94%.

Young adults watching fewer hours of traditional television has been the subject of several recent
studies. On the following page are some examples.

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 • A report from Pew Research released in September 2017, found 61% young adults age 18 to 29
use online streaming as their primary source to watch television. On the other hand, only 31%
said they most watch television via a cable or satellite subscription. Conversely, 70% of adults
age 50 to 64 watch television via cable or satellite (10% use an online streaming service). For
adults age 65 and older, the difference is even greater, 84% watch television primarily through a
cable or satellite provider with 5% using an online streaming service.
• A survey released in September 2017 from the Omnicon Media Groups agency, Hearts &
Science, found 47% of adults age 22 to 45 are viewing no content on traditional TV platforms,
the agency called them “unreachables”. In the study, the agency claims the age group (a
combination of Millennials and younger members of Generation X), are watching streaming
content on apps and smartphones, presently unmeasured by Nielsen and comScore. The agency
claims marketers have to be far more creative when targeting these younger age groups.
• A study from the Consumer Technology Association released in August 2017, found adults age
18 to 34 spend only 45% of their video time watching with live television. By comparison, adults
35 and older spend 66% of their time with live television. The study found adults age 18 to 34
spend 35% of their video viewing with streaming providers such as Netflix and 20% watching
shows recorded on DVR’s.
• A study from CBS noted Millennials are watching far less television than Baby Boomers when
they were the same age. The CBS study, released in May 2017, found as Millennials get older
they are more likely to watch traditional television. CBS theorizes because of Millennials have
“delayed adulthood”, television usage will not increase until they grow older, leave their
parents’ household and settle down.

Not only are Millennials light viewers of traditional television, they have been watching even fewer
hours with each passing year. According to Nielsen’s People Meter sample, weekly time spent viewing
traditional television/DVR playback among Millennials has fallen by 16% in the past two years, to
roughly 2½ hours of television each day. While this an alarming decline, Millennials who are living in
their own home with children watch more television roughly 3-and-a quarter hours each day. On the
other hand, the more settled adults 35+ continue to be heavier viewers of television. [Chart 3]

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Coinciding with time spent watching television, young adults also watch far fewer channels than older
adults. Nielsen’s annual Channels Receivable report found, in the course of month, adults age 18 to 34
watch an average of 15.5 television channels (defined as ten consecutive minutes in one week). In
contrast, older age groups, who are heavier viewers of traditional television, watch noticeably more
channels each month. [Chart 4]

Cord Cutters and Cord Nevers

Consumers who have dropped their cable subscription can be divided into two groups.

• Cord cutters, people who have opted out of standard cable TV subscriptions.
• Cord nevers, people who never had any standard TV subscriptions to begin with.

According to MRI’s Cord Evolution study released in April 2017, cord cutters have an average age of 43
and account for 8% of the population. Cord nevers are younger with an average age of 34 and account
for 9% of the population. Nielsen says in 2017, one in three households in which the head was under 35,
did not have a cable or satellite TV subscription, a higher figure than either Generation X (24%) or Baby
Boomers (15%). Nielsen also reports that Millennials living in their own home and with children are
more likely to subscribe to a pay TV service.

The number of consumers dropping their MVPD subscription has increased for five consecutive years.
eMarketer reported in 2017, there were 22.2 million adults that have cut the cord on their
cable/satellite/telco service, this represents a 33% increase from 2016. In addition, the amount of cord
nevers grew by 6% and now total 34.4 million people. [Chart 5]

In a report released in July 2017, eMarketer forecasts by 2021, cord cutters and cord nevers will be
almost equal in size. Hence, 81 million U.S. adults or roughly 30% of the population will not subscribe to
a traditional pay TV service. In 2017, there were 196.3 million U.S. adults with a traditional pay TV
service, a decline of 2.4% from 2016. eMarketer projects by 2021 the figure will further drop to 181.7
million, a decline of about 10%. The number of adults 55 and older that are pay TV subscribers however,
will continue to grow in the years ahead. On the other hand, the number of pay TV subscribers among
younger age groups are expected to decrease.

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With the average monthly cable subscription now costing over $100, TiVo’s Video Trends Report for
third quarter 2017, reports cost, is by far, the primary reason consumers do not have a pay television
subscription. Another reason cited for dropping their pay TV services was the availability, price and
convenience of subscribing to an SVOD service such as Netflix, Hulu and/or Amazon Video. These
services also offer critically acclaimed and award-winning content and many come with no advertising. A
report from the Leichtman Research Group released in July 2017, said 51% of adults age 18 to 34 stream
a subscription video-on-demand service every day, a significant increase from 33% in 2015. The 2017
figure is also notably higher than the 29% of total adults (age 18+) who watch SVOD content daily.

Moreover, over the past few years, a number of virtual MVPD’s have been launched, providing
consumers with skinny bundles and a less expensive alternative than a pay TV subscription. For example,
Hulu Live, YouTube TV and Sony’s PlayStation Vue charge subscribers $40 each month, with other
streaming providers costing even less. Other reasons cited by TiVo’s report included; using an antenna
to get basic TV channels and the ability to binge watch (a popular activity with Millennials) an entire
season of a TV show on a streaming service. [Chart 6]

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 Who Owns What: Media Device by Generation

According to Nielsen’s Total Audience Report for first quarter 2017, Millennials are more likely than
Generation X or Baby Boomers to have a multimedia device (e.g., Roku, Google Chromecast, Apple TV,
etc.) that allows users to stream video content on television, they are also more likely to own a video
game console and have a subscription video on demand service (e.g., Netflix, Amazon Prime Video,
Hulu, etc.). In addition, 97% of Millennials have a smartphone, higher than any other adult group. On the
other hand, Millennials are least likely to have a DVD Player and a DVR. [Chart 7]

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 Millennials and Streaming Video

A survey from Morning Consult, released in August 2017, found 67% of Millennials, (adults age 18 to 29),
subscribe to between one and three streaming services. The survey also found 55% were willing to
subscribe to a streaming service just to watch one particular show. Not surprisingly, a majority of
Millennials wished all their favorite shows were available on just one provider. Over 40% of Millennials
said there were already too many streaming services, even though more are being launched. Although
most Americans spend $10 or less each month for streaming services, about 50% of Millennials say they
pay over $10 monthly to streaming providers. Netflix, is by far, the most popular streaming service
among Millennials (67%), Amazon Prime Video is the next popular at 28% followed by YouTube and Hulu
both at 23%.

Millennials and Digital Video

As Millennials watch less and less traditional video content and many don’t have a pay TV subscription,
what are they watching online? A report from Nielsen, released in January 2018, found young adults
visit several prominent digital publishers on a daily basis. Below are a few Nielsen noted.

BuzzFeed: Millennials (defined as adults age 18 to 34 in the report), are attracted to BuzzFeed’s content
of posts and streaming videos. According to Nielsen, Millennials watch an average of 38 videos on
BuzzFeed each month, an indication of their appeal with the younger age groups. Among the more
popular features is Tasty, a social food network providing recipes and tips on cooking. BuzzFeed has
become an online destination with many young adults, reaching 83% of adults age 18 to 34 each month.

Group Nine Media: Launched in 2017, the company operates four websites; NowThis, The Dodo, Seeker
and Thrillist. The website is popular with animal lovers and lifestyle enthusiasts to news junkies. Group
Nine says it has nearly one billion minutes of content consumed each month across the four websites.
The website is especially popular with young adults reaching 81% of Americans in their twenties.

Mic: Has emerged as a popular destination with young adults interested in news and storytelling with a
diverse perspective. The news service averages over 40 million unique visitors monthly. The website
reaches over 25% of adults age 21 to 34 in the U.S.

Refinery29: Is a website that focuses on content ranging from fashion, beauty, entertainment and
money. The website’s video and text content are especially popular with younger females, reaching 62%
of women age 18 to 34 monthly. Refinery29 is even more popular with women age 21 to 24, reaching
over 88% each month.

VIX: Focuses on multicultural content providing social video, lifestyle tips, entertainment and food in
English and Spanish. The website reaches over 40% of women age 18 to 49, with higher engagement
among Millennials.

Millennials and Web Connectivity

For younger adults the Internet has become omnipresent. In a survey from Pew Research released in
February 2018, 98% of adults age 18 to 29 and 97% of adults age 30 to 49, said they access the web, the
highest of any age groups. The percentage of older adults accessing the Internet is lower. For adults age
50 to 64, 87% use the web. The percentage of the adults age 65 and older going online is the lowest of
any adult age group at 66%.

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According to a Pew Research study released in March 2018, younger adults, are also more likely to be
constantly connected to the web than older age groups. The survey found 39% of adults age 18 to 29
now go online constantly, while 49% access the web multiple times throughout the day. By comparison,
only 8% of adults age 65 and older are constantly using the web and only 30% go online multiple times
daily. The study found, at 36%, adults age 30 to 49 are now nearly as apt as younger adults for constant
online connectivity. The share of adults age 30 to 49 who say they are constantly connected has
increased by 12% since 2015. Lastly, the share of adults age 50 to 64 constantly online among has grown
from 12% to 17%.

Millennials and Social Media

Led by Facebook and Google’s YouTube, social media continues to play an important part in the media
consumption of millions of Americans, especially Millennials. According to Pew Research survey released
in March 2018, 88% of adults age 18 to 29 said they use social media on a daily basis. The percentage of
daily usage with social media steadily decreases with older Americans. For example, 78% of adults age
30 to 49 say they use social media daily, the figure drops to 64% with adults age 50 to 64 and falls to
only 35% for adults age 65 and older. Younger adults are far more likely to embrace newer social media
platforms. For instance, 68% of adults age 18 to 29 use Snapchat and 64% use Instagram, for older
adults the percentage of usage is significantly lower. Of the eight social media websites in the Pew
survey, adults age 18 to 29 use an average of four of them. That number drops to two with adults age 50
to 64 and only one with adults age 65 and older. [Chart 8]

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 ECONOMICS

Millennials: Living Arrangements & Dollars

When compared to previous generations, today’s young adults are delaying marriage, becoming parents
and buying a house. The Census Bureau issued a report in April 2017 on “The Changing Economics and
Demographics of Young Adulthood: 1975–2016”. Below are some key takeaways:

• Young people are delaying marriage, although most will eventually tie the knot. In the 1970’s, 8
in 10 people were married by the time they turned 30. Today, not until age of 45 have 8 in 10
people married.
• More young people today live in their parents’ home than in any other arrangement: 1 in 3
young people, or about 24 million adults aged 18 to 34, lived in their parents’ home in 2015.
• In 2005, the majority of young adults lived independently in their own household, which was the
predominant living arrangement in 35 states. A decade later, in 2015, the number of states
where the majority of young people lived independently has fallen to just six.
• More young men are falling to the bottom of the income ladder. In 1975, only 25% of men aged
25 to 34 had incomes of less than $30,000 per year. By 2016, that share rose to 41% of young
men, (incomes for both years are in 2015 dollars.)
• Between 1975 and 2016, the share of young women who are homemakers fell from 43% to 14%
of all women aged 25 to 34. The U.S. Department of Education reports that in the Fall of 2017,
women will comprise 56% of college students.
• Of the young people living in their parents’ home, 1 in 4 are idle, that is they neither go to
school nor work. This figure represents about 2.2 million adults age 25 to 34.

Fewer Millennials Are Household Heads

The Pew Research Center reports, in 2016, that 15% of adults age 25 to 35 were living in their parents’
home. This figure is notably higher when compared to previous generations when they were the same
age. For example, in 2000, only 10% of Generation X were living at home with their parents. Even as the
unemployment rate has dropped for Millennials to 5.1% in 2016 (from 10.1% in first quarter 2010), the
percentage of Millennials moving back home (from college) has grown from 12% to 15%. [Chart 9]

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Millennials are also delaying marriage. According to the Census Bureau, in 2016 the median age for a
first-time marriage in the U.S. was 29.2 for males and 27.1 for females, both are all-time highs. By
comparison, in 1975 the median age for a first-time marriage was 23.5 for males and 21.1 for females.

Other factors include Millennials have been spending a longer period of time pursuing a higher
education and when combined with a greater number of females entering the workforce, the result has
been the postponing marriage and parenting. In addition, the recession begun in 2008, resulted in a
housing market meltdown which was also a factor in delaying the traditional milestones of young adults.

Furthermore, Millennials are not moving out of the parents’ home very quickly. According to the Census
Bureau, 9 in 10 Millennials living in their parents’ home one year ago were still living there. There are
now significantly more young adults living with unmarried partners (instead of getting married),
roommates and other family members (besides their parents), or are living alone, than there were in
1975. In 2016, only 27% of adults age 18 to 34 were living with a spouse, down from 57% in 1975. In
sum, there are far more living arrangements with young adults today than forty years earlier. [Chart 10]

For the First Time, Living with Parents Edges Out Other Living Arrangements for 18 to 34 Years Old

In 2014, the Census reported that adults age 18 to 34 were more likely to be living in their parents’ home
than living with a spouse or partner in their own household. The Census noted it was the first time this
living arrangement was predominant with young adults since they began to identify an individual's
relation to the head of household in 1880.

Pew Research Center, May 24, 2016

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 Millennials and College Debt

College educated Millennials are more likely to be employed and have a better paying job than their less
educated peers. According to Pew Research, 40% of millennials between the ages of 25 to 29 have at
least a bachelor’s degree, higher than any previous generation (it had been 32% for Generation X).

Unfortunately, that can come with a price tag; debt. In total, 44.2 million Americans, owe a staggering
$1.48 trillion in student loan debt, which is $620 billion more than the total credit card debt. On
average, a college graduate from 2016 owes $37,172 in student loans, a 6% increase from the
previous year. College graduates spend (including interest) an average of $351 each month paying
off their student loan. The percentage of household heads under 35 with a college debt has grown from
17% in 1989 to about 40% today.

As reported by the 2017 Student Loan Debt & Housing Report, many Millennials cited college debt as a
primary reason for delaying their decision to buy “big ticket items”. In the survey, 76% of Millennials said
they have delayed the purchase of buying a house because of their student loans, 72% have passed on
taking a vacation, 65% have not purchased a car, 58% have delayed living alone and 46% have cut back
on their entertainment purchases.

Median Income by Age Group

According to the Federal Reserve, although Millennials are better educated than any previous
generation, they earn about 20% less than baby boomers did (in real dollars) at the same stage of life.
One reason cited by financial analysts is Millennials lost a lot of economic ground because of the
recession. These days for Millennials to get a higher income, it requires them getting an advanced
degree, however, that can result in more student loans and debt.

According the Census Bureau, median income by age is highest among households maintained by
persons age 45 to 54 at $77,213. This was followed by householders age 35 to 44 at $74,481 and
householders age 55 to 64 at $65,239. Millennials have not yet reached their peak earning years, the
median income by households headed by adults age 25 to 34 is $60,932. Only those households headed
by persons age 15 to 24 (a small group in the workforce) at $41,655 and households headed by persons
age 65 and older (many are retired, volunteering or working part-time), at $39,823 were lower. [Chart
11]

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 Median Net Worth by Age Group

Among the primary reasons for Millennials to live at home with their parents include the cost of living
independently and their debt obligations.

Many Millennials have a negative net worth that peaks at nearly $39,000 at the age of 21 (due primarily
to college debt). According to the College Investor, the average millennial does not accumulate any net
worth until the age of 30. [Chart 12]

The Census Bureau reports that adults under the age of 35 have an average net worth of nearly seven
thousand dollars, by far and away the lowest of any age group. There is a correlation between age and
net worth. For example:

• The median net of adults age 45 to 54 (when median household income peaks) is more than
double the net worth of adults age 35 to 44.
• The median net worth doubles again when of adults 65 and older is compared to adults age 45
to 54.
• The median net worth of adults 65 and older is nearly thirty times greater than adults under 35.
[Chart 13]

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 Millennials and “The Shared Economy”

One of the more notable shifts in recent years has been the emergence of the shared economy. A
shared economy provides individuals with the ability to rent or borrow goods rather than to buy and
own them. Services such as Uber and Airbnb, have proven more popular with Millennials than with older
adults.

A study from Pew Research, released in 2016, found using a shared economy service is far more
prevalent with younger age groups, noting usage begins to fall off precipitously after the age of 45. The
Pew study noticed about one-third of persons between the ages of 18 to 44 have used four or more of
shared economic services and only a relatively few have had no exposure to these services. By contrast,
44% of adults age 50 and older, and 56% of adults age 65 and older, have not used any of these services.

According to a Maru/Matchbox study, released in March 2017, Millennials are more than twice as likely
to rent an Uber, an online ride hailing service than older adult. Millennials are nearly three times more
likely to lodge at an Airbnb, a home sharing site than adults age 35 and older. [Chart 14]

Despite is popularity with young adults, the shared economy has had its issues. A study from
Maru/Matchbox, released in April 2017, pointed out that although Millennials have demonstrated a
higher level of comfort with them, they are also more likely to report having problems with these
services. According to the study, three in ten Millennials have experienced poor service, service not as
advertised, or unprofessionalism with the shared economy. The survey also found 70% of Millennials
cited the ability to pay with a smartphone app or website, as primary reasons for the popularity of using
these services.

Millennials: Ethnic Diversity

Another characteristic distinguishing Millennials with older generations is ethnicity. Millennials are far
more ethnically diverse than any other adult generation. This is no surprise since the United States is
becoming more diverse, especially among younger age groups.

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 • For adults age 55 and older, 75% of the population is white (non-Hispanic), with African-
Americans accounting for the largest minority group at 10% and Hispanics representing 9.1% of
the age group.
• For adults age 35 to 54, whites (non-Hispanic) account for 61.5% of the age group, 17.6% is
Hispanic and 12.5% is African-American. These percentages are very similar to the national
average.
• For adults age 18 to 34, 55.8% of the population is white (non-Hispanic), 20.8% is Hispanic,
13.9% is African-American and 6.4% is Asian-American.

The population of Americans under the age of 18 is even more diverse, with whites (non-Hispanic)
accounting for just 51.5% of the population. According to the Brookings Institute, reasons for younger
age groups becoming more diverse have been the rise in immigration from Latin American and Asia
throughout the 1980’s and 1990’s, coupled with an aging white (non-Hispanic) population.

MEDIA TRUST AND INFLUENCE

The Power of Television Advertising

Advertisers have had a long and successful relationship with television, stretching back for nearly seven
decades. Today, with consumers exposed to thousands of ad messages daily, television continues to
prevail as the preeminent medium to reach audiences and build brand awareness. According to a survey
from Clutch, “How Consumers View Advertising” released in December 2017, television continues to be
the most successful medium in influencing consumers to purchase a product.

In this era of “fake news” assertions, the survey found that at 61% television has the highest
trustworthiness of any advertising medium. Following television, were print at 58%, radio/podcast at
45% and out-of-home (billboards/public transit) at 42%. By comparison, 41% of respondents thought
online ads were trustworthy and an even lower 38% thought social media ads were trustworthy.

Millennials are more influenced by advertising than older adults. The Clutch survey found 81% of
Millennials (adults age 18 to 34) made a purchase because of an advertisement, a figure notable higher
than Baby Boomers (adults age 55 and older) at 57%. The survey also found television advertising is
more likely to influence Millennials than either online/social media and print. Television was also found
to be the most influential advertising medium with Generation X (adults age 35 to 54) and Baby
Boomers (adults age 55+). [Chart 15]

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Television is regarded as a more trustworthy advertising source for adults 35+ than social media.
Furthermore, advertisements are more influential with higher income homes. According to Clutch, 83%
of consumers in homes with an income of $100,000 or more say they are influenced by advertising. As
Millennials get older, build their career, get married and become parents, television increases as the
preeminent medium to build brand awareness and trust. [Chart 16]

A Few Issues with Digital Media

Digital media is popular with advertisers for a number of reasons, they can reach young adults, they can
target specific audiences, they can provide direct to consumer advertising, they have e-commerce
capabilities, they can more easily measure return on investment (ROI), have global reach, among other
attributes. As a result, many marketers continue to allocate a greater portion of their ad budget to
digital media. Despite its growth and popularity, the medium does have some areas of concern with
advertisers and a few are taking note. Below are a few of these issues.

Viewability: In response to concerns that online ads were not being viewed, the Media Rating Council
(MRC) in 2014, established a set of standards to measure viewability for online advertising. Under these
standards for online videos, it was required a minimum of 50% of the pixels in the video ad can be
viewed for a minimum of two seconds before an advertiser is charged. The standard has since been met
with resistance by a number of agencies and advertisers. In August 2017, WPP’s Group M, the world’s
largest media investment agency, issued its own standards: 100% of a video must be in view for 50% of
its duration with sound. Several “blue-chip” advertisers have also followed suit with stricter viewing
guidelines than the MRC’s including; Unilever, Campbell Soup, Shell, Subway, IBM, Hewlett-Packard,
Nestle and Volvo. In March 2018, the MRC announced it will review its digital viewability standards, with
the expectation that video ads must be 100% viewable.

Ad Blocking: Ad blocking is a program that will remove different kinds of ads from a Web user's online
experience on both mobile devices and desktops. The use of ad blocking software continues to grow. In
2017, eMarketer estimated there were 75.1 million Americans using ad blocking or 27% of web users.

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Among age groups, ad blocking is more prevalent with Millennials. eMarketer forecasts 41% of
Millennials used ad blockers in 2017. According to eMarketer, reasons for Millennials use of ad blocking
being higher is they are more tech savvy, are more willing to use new technology and spend more time
online and watching videos than older adults. OnAudience.com estimates the use of ad blockers
resulted in a loss of over $15.8 billion in publisher ad revenue in 2017 in the U.S., up from nearly $11
billion in 2016.

Brand Safety: The growth of programmatic advertising, which automates where online ads are placed,
was supposed to simplify the digital ad buying process on how and where ads are placed. The problem
however, is marketers are no longer aware where its ads are being seen online. This can result with ads
running alongside offensive and at times profane material. The ads can also run on websites with fake
news, divisive politics, sites promoting terrorists as well as disasters and tragedies. A survey among U.S.
marketers polled in November 2017, by Digiday and GumGum, found over two-thirds of marketers said
their brands had been exposed to a brand safety issue at least once. More than half of them had a brand
safety issue more than once. Several prominent advertisers have pulled their ads from websites because
of brand safety concerns. In March 2018, Bank of America announced the creation of a “brand safety
officer” to monitor the company’s online media spending.

Association of National Advertisers (ANA) and Brand Safety

“There is no more important asset for a marketer than the brand. Brands are the basis for marketers'
relationships with consumers and customers. Brand value, brand equity and brand loyalty are all
treasured assets that we, as marketers, are entrusted to build, nurture, grow and strengthen. That is our
essential role. Anything that disrupts, disturbs or threatens consumer and customer relationships —
relationships based on trust and positive experiences — should be avoided at all cost...

…We view brand safety issues as an unfortunate example of the many challenges that exist throughout
the digital media supply chain”.

Bob Liodice, President & CEO, ANA

March 2017

Ad Fraud: Is any deliberate activity preventing the proper delivery of digital ads to the right people at
the right time, in the right place. In essence, ad fraud trick advertisers into paying for something that
is worthless to them, such as fake traffic, fake leads and/or ineffective ad placement. Fraudsters have
the ability to earn money by serving ads with no chance of being viewed by a person. According to a
recent study from Adobe, 28% of website traffic comes from “bots” or non-human traffic. This makes it
hard for online advertisers to know who and why persons are visiting its website. The Internet
Advertising Bureau (IAB) reports ad fraud had cost the industry $8.2 billion in lost dollars in 2017.

Transparency: Some digital media companies have recently made data miscalculations in key audience
metrics including, overstating the length of viewing for a video ad, undercounting or overcounting
website audiences among other errors. This has led to an industry wide discussion about the trust and
lack of transparency with digital media. As a result, the MRC is conducting an ad metrics audit that is
expected to be finished by March 2019. Some in the industry have begun to use independent third-party
audits from Moat, Integral Ad Science and others to better authenticate ad measurements on digital
media.

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Data Breaches: The amount of personal data digital media companies has amassed of their users and
what they do with it, has raised concerns about privacy rights. In the future, digital media companies
may come under restrictions on how personal data can be used by lawmakers and regulators. Data
breaches may also have an impact on users, Wall Street and the advertising community.

A few advertisers have made been reevaluating their commitment to digital media. Below are a few
examples.

• Procter & Gamble, the largest global advertiser, said it had been reevaluating their marketing
strategy. The company cut around $200 million in its digital media spending due to issues of ad
fraud and brand safety and reinvested it into “media reach” vehicles including television, audio
and ecommerce. Although P&G was not specific of what websites they pulled spending from, in
March 2018, they announced they had cut ineffective marketing by 20% and increased reach by
10%.
• In February 2018, Unilever, the second largest global advertiser, threatened to pull their ads
from digital platforms citing fake news, racism, sexism and extremism. Unilever said these digital
dangers outweigh the potential benefits.
• In March 2017, the New York Times reported that J.P. Morgan Chase online ads had appeared in
over 400,000 websites each month. As concerns of web content and brand safety grew, the
marketer cut back on the number of display ads to only 5,000 preapproved websites. Despite
the cutback, the advertiser reported little change in the visibility of their ads online.

Millennials and Other Media Usage

Young adults are also prominent users of other media compared to older adults. For example:

• 91% of Millennials (adults age 18 to 34) go to the movies each year, the highest percentage of
any age group. (Source: Nielsen/MRI Fusion)
• 37% of Millennials (adults age 18 to 34) report listening to podcasts at least once each week. In
addition, 13% say they listen every day. This is notably higher than the 5% of Adults 35 and older
who listen daily. (Source: Nielsen Audio)
• Men and women between the ages of 21 to 35 are the primary viewers of e-sports. They make
up 53% of the total viewership. (Source: Internet Trends Report)
• Almost 60% of Millennials (adults age 18 to 34), say they use two or more apps to stream music,
compared to just under 40% of adults age 35+. (Source: Nielsen Audio)
• 44% of Millennials (adults age 18 to 34) say they own a smartwatch, compared to 23% of non-
Millennials (Source: Fluent)

Finding the Media Mix

The media landscape has been evolving rapidly and nowadays, advertisers have many choices when
deciding where to invest their marketing dollars. There have been several notable studies reporting the
optimal media combination to build a brand’s return on investment continues to include television.

The largest and (to date) most inclusive study on advertisers’ ROI came from the Advertising Research
Foundation (ARF). The study measured over 5,000 ad campaigns using 12 years of data that totaled over
$375 billion in ad spending. The study tracked over 100 product categories across 45 countries. The

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results? The organization’s 2016 study, “How Advertising Works,” found when advertisers drop
traditional media for digital, it resulted in a decline in sales. The ARF then made the following
recommendations which included:

• Investing in a number of platforms instead of shifting dollars from platform to platform.

• Adding traditional media to digital media to boost ROI.
• Using traditional and new media, not just mobile, to reach millennials.

Additionally, the study found when digital media is added to television a brands ROI grows by 60%, the
highest of any media combination.

Similarly, a cross-channel advertising attribution study from Accenture (commissioned by ABC) released
in May 2016, found multiplatform TV advertising significantly enhances the impact of digital advertising
(search, display and short-form video).

Conclusion

Media and television are changing, especially with Millennials who are watching more video content on
other screens and platforms. Older adults are also heavy viewers of traditional television, with Baby
Boomers watching up to six hours a day. Older age groups are more settled and since they are wealthier,
have more disposable income allowing them to buy more expensive products (such as hunting and
fishing equipment). Hence, advertisers should “fish where the fish are” and that remains television.
Today, the average household has 200 TV channels to choose from, allowing advertisers to specifically
target an attentive audience with the right message using the unquestioned power and trust of
television.

Developing a media strategy still requires television, the medium remains preeminent in informing
viewers and building awareness in a brand safe environment. As a result, customers want what you are
selling. Today, most successful advertising strategies use television along with digital media. Often
times, television builds awareness and can drive traffic to a company’s website, to seek more product
information.

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 ABOUT THE AUTHOR

Brad Adgate is an Independent Media Consultant based in Cambridge, Massachusetts.

Adgate has over 35 years of experience in media in various capacities. Most recently, Adgate was Senior
Director, Media Insights at Comcast Spotlight. At Comcast, Adgate was charged with developing a
communication and thought leadership strategy for key stakeholders. Previous to Comcast, Adgate
spent 17 years at Horizon Media as Senior Vice President, Director of Research. Prior to joining Horizon,
Adgate worked in the media research departments at Grey Advertising, Backer & Spielvogel and Saatchi
& Saatchi. Adgate also held positions in ad sales research at several top tier cable networks including
Turner Broadcasting, TNN/CMT and The Family Channel as well as working in syndicated television and
radio.

While at Horizon Media, Adgate authored dozens of newsletters providing in-depth analysis on
numerous industry topics and trends. In addition, Adgate provided audience estimates, POV’s,
presentations, white papers as well as an annual program development book and upfront analysis on
program trends. Adgate has been published a number of times by trade publications, including ANA’s
The Advertiser, Advertising Age, Mediapost and Adweek. Adgate is currently a Forbes.com contributor.

Adgate, has been interviewed numerous times about the media and advertising business on Bloomberg
TV, Bloomberg Radio, CNBC, MSNBC, Fox Business, Fox News, CNN, Yahoo Finance, Marketwatch and
NPR as well as CBS Sunday Morning and The Daily Show. Adgate has also been quoted extensively by
The New York Times, Wall Street Journal, Los Angeles Times, USA Today, Bloomberg Business Week and
many other prominent trade and consumer publications covering media trends.

Adgate has also provided a number of webcasts and presentations on the media landscape, he has also
participated in many industry related panels at trade shows. Adgate has been active in a number of
advisory boards including Nielsen, Kantar and Arbitron Radio. Adgate was a member of the Council for
Research Excellence (CRE) and chaired the Digital Committee. Adgate has been a member of the Board
of Directors at the Media Rating Council (MRC) and an ambassador to the Advertising Research
Foundation (ARF). Adgate also chaired the Media Measurement Committee for the American
Association of Advertising Agencies (4A’s). Adgate co-authored the first POV for the 4A’s, on the need to
improve local TV measurement.

In 2002, Adgate was named a “Media Maven” by Advertising Age. For a number of years, Adgate was
named as the most quoted media executive by Advertising Age’s annual “Media Talk” survey. In 2006,
Adgate was named a “Media All Star” in the research category by Adweek. In 2009, Advertising Age
named Adgate one of “25 Media People You Should Follow on Twitter” @badgate.

Adgate graduated from Jacksonville University. In 2014 he was named one of “80 Alumni You Should
Know” by the University.

The Pursuit Channel commissioned Adgate to write this white paper. For any questions or comments, he
can be reached at bradadgate@gmail.com.

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