Streaming was supposed to rescue the ailing TV ad business. It hasn’t.

livemint.com:

When Mondelez sought to promote a limited edition of its Oreo cookie earlier this year, it did something that would have been unthinkable not that long ago: It didn’t spend a dime advertising on TV. The snack company had a simple reason for that decision. The people it was looking to reach—Gen Z members, multicultural audiences and households with children—aren’t watching enough television.

“You have no single shows pulling together a big enough audience like ‘Friends’ or ‘Seinfeld’ used to do," Jonathan Halvorson, Mondelez’s global senior vice president of consumer experience, said of the current state of TV. And streamers such as Netflix aren’t a perfect alternative: Their nascent advertising platforms charge too much and don’t yet reach enough people, he said. The maker of Ritz crackers and Sour Patch Kids candy is spending about 15% of its U.S.

ad budget on TV this year, down from 42% three years ago. Halvorson said an additional 9% is going to streaming, meaning that more than three-quarters of its ad spending will go elsewhere. To promote its new Oreo Space Dunk, Mondelez turned to social-media sites such as Instagram and TikTok, Halvorson said.

It also relied heavily on ads that appear where people already are in a shopping mood: the websites of large retailers, including Amazon and Walmart. The move marks an important inflection point. TV commercials have long stood as the cornerstone of modern advertising.

This dominance was owed, in part, to TV’s capacity to reach vast and diverse audiences through ads that leverage sound, sight and motion to evoke emotional responses. These vast audiences aren’t tuning in anymore. “There is no longer that single lever you can pull," said Vinny Rinaldi, Hershey’s U.S.