Brian Wieser’s keynote address covered four trends that are affecting the media and advertising industries: industry consolidation, the rise of ad-free TV, the emergence of new e-commerce marketers and procurement. After his presentation, Scott McDonald probed him further about his observations about the state of the media and advertising marketplace in 2023. His key points on these four trends and highlights of Brian’s conversation with Scott appear below.
Fifty years ago, defining TV was pretty simple but the video landscape has changed dramatically in the last 10 years. Video is growing today, and this is driven by CTV. TV formats have their own personalities and content to define them. TV should not be approached in isolation because that is not how consumers approach it.
Mike Fisher of GroupM shared findings from an eye-opening study conducted with iSpot.tv, investigating continuous play scenarios. It revealed a viewability issue with external, third-party, streaming devices such as Roku, Amazon Fire TV and gaming consoles Xbox and PlayStation. Such devices make the verification of ad delivery via TV apps more difficult. While such a device may signal that an ad was delivered, the TV screen itself may be off. Since external devices and the TVs they are attached to do not talk to each other, and so the message is lost. Fisher urged this as an industry-wide issue that multiple parties: manufacturers, publishers, agencies and advertisers, need to come together to fix.
Media use has been changing rapidly and that requires paying constant attention to how viewers use services, for example, which streaming services they subscribe to and which they cancel. Churn among streaming service subscribers is typically seen as a negative: Providers try to minimize churn, maximize retention. Based on analyses of their Subscriber Science Monitor data, Magid researchers Mike Bloxham and Tony Cardinale offered a fresh perspective on the drivers of churn as well as on the implications of churn for content providers. They conclude that churn is inevitable—and that some churn is correlated to growth and cultural relevance. The key to their insights was a segmentation analysis that focused on viewers’ propensity to churn.
In 2021, the ARF launched DASH in response to today’s overwhelming complexity in measurement due to the digitization of TV, which has made user-level data especially challenging. In this panel discussion, the speakers provide an overview of DASH, including its methodology, use cases, key findings and opportunities. DASH has evolved to set a new standard in the media industry and serves as a perfect example of how cross-industry collaborations can happen.
This dialog between Scott McDonald and Colleen Fahey Rush (Paramount) covered the rebranding of Colleen’s company and three broader issues facing the television industry—the rise of streaming services, her perceptions of the currency environment and the upcoming upfronts.
Justin Evans – Global Head of Analytics & Insights, Samsung Ads
Justin Evans of Samsung Ads uncovered findings from The Streaming Index, a bi-annual white paper Samsung Ads puts out for the marketers of TV apps. The report got its data from its universe of 45 million opted-in U.S. smart TVs, supplemented with an attitudinal survey of 1,000 Samsung smart TV owners from Q4 of 2022. While most studies focus on subscription data, this focused on usage. The number of people streaming TV apps and the time spent watching them has significantly increased year-over-year (Q3 2021-Q3 2022), and yet competition among platforms has grown fiercer. The reason, the churn rate has increased over the past two years. Such a landscape perpetuates a winner-take-most paradigm. TV app marketers should be thinking about ways to acquire a greater share of time and TV app platform providers should focus on loyalty and offering less expensive tiered options, as retained users over-index on time on such apps.
Key Takeaways
The number of average monthly streamers increased 17% year-over-year and the time spent streaming increased 31%.
On linear, 33 channels are viewed by the average user, but the average streaming user only has three to four apps. While changing channels on linear is seamless, changing between content happens more within the app, as changing apps isn’t frictionless. This makes the marketing barrier much greater.
Samsung Ads created a churn ratio which is lapsed users within 12-months divided by active users for the current month. They found that in Q3 2021, the overall churn ratio was 4.8 past users to one current one, while one year later it went up to seven (seven users churned for every one that stayed).
TV apps were divided into three tiers. Tier 1: the top 20% of apps based on average monthly user count, Tier 2: The next 20% based on average monthly user count, Tier 3: the 60% of apps with the smallest monthly user count.
The churn ratio was different depending on what tier a TV app was on. Tier 1 apps in Q3 of 2022 saw a 1.7 churn ratio, tier 2: 3.5 and tier 3: 9.7.
When it came to user share of the average TV app, 23% were new users, 24% returned users and 53% were retained users. With time share, retained users represent 73% of time spent on the average app (new users 14%, returned users 24%).
How can platforms increase retention? Fifteen percent of respondents said a deep library of exclusive content was most important. They also like seeing new content frequently.
Cost is also a factor. Ten percent said they used a platform because it was lower cost than others or free. Twenty-one percent said they would try a new service that was free or low cost. A high cost was also the number one factor of cancelling a streaming service (30%).
The report found a 6% retention rate among hybrid TV apps.
Fifty years ago, defining TV was pretty simple but the video landscape has changed dramatically in the last 10 years. Video is growing today, and this is driven by CTV. TV formats have their own personalities and content to define them. TV should not be approached in isolation because that is not how consumers approach it.
Key Takeaways
The rapidly changing landscape: 70% of U.S households have at least one connected TV; Roku and Amazon are still among the top OEMs; 94% of viewing on linear is still live or same day.
Growth is due to the increase in streaming especially FAST which are having double digit growth. But how will the landscape unfold as, and if, the economy downturns. TUBI expects one in three streamers to reduce their channels.
There has been a rapid decline in pay subscriptions over the last 5 years from 66% to 43% with a concomitant rise in cord cutters. Cord-nevers have leveled off at 13% having risen to 20% in 2020.
COVID caused a rapid bump in viewing of TV and video, it retreated during 2021. But now we are seeing a renewed growth in the total amount of television and video. While there is a slow erosion, linear is still alive and well.
One important story is the growth overall of exposure to video through different channels such as gaming and social. But it is content as well as mobile availability that is driving growth. Nearly 50% of linear content consumed is news, sports and movies. However, movies have lost a 5% share over the last 5 years, no doubt the loss coming from the growth of SVOD.
Sports occupies a unique place in content. It accounts for more than half of all social media posts, and sports fans index at 124 for pay tv subscriptions.
