Tag Archives: tv

Study: Consumers resist paid live streaming

Despite predictions that live streaming television was going to be one of the hottest features in 2017, interest in this service has fallen flat. StreamOn, a new Cogent Reports study by Market Strategies International, has found that only 11 per cent of all streamers pay for live streaming television.

Nearly a dozen new name-brands entered the video streaming market in 2016, and virtually all of them offer and highlight live video streaming. With the exception of sports and news, Market Strategies International research shows that viewing live content is not in high demand as it is currently offered.

“TV providers are failing to recognise that the habits and needs of the viewer have dramatically changed, and the old rules of television no longer apply,” noted Greg Mishkin, vice president of research and consulting at Market Strategies. “TV providers must evaluate and revise the business model to fit the needs of the consumer, because if they don’t they are setting themselves up to fail.”

This customer experience research shows that nearly three-quarters (73 per cent) of the population use streaming services and nearly one-third (29 per cent) of those who stream have either cancelled or downgraded their traditional TV services. According to Market Strategies International, this signals a dramatic change in how television is sold. The most successful streaming companies are the ones that have gone outside the components of the traditional pay-TV format: broadcast channels, scheduled live programming, and programming guides, with Netflix currently the leader in the video streaming industry, setting the bar for other streaming providers.

“While Netflix has the highest use rate and share of wallet by a long shot and is the provider to beat—there is not a clear winner yet. None of the current providers has cracked the code on what consumers want,” continued Mishkin. “However, the research clearly shows that the strength of the leaders is due to their ability to break free from the old rules of TV.”

Snapchat is The Next Must-See TV Network

by Anupam Gupta

Snap was recently in the headlines with disappointing financials for its second quarter in a row, but the company is already one step ahead thinking of ways to overhaul the app to make it easier for consumers to engage with and use. Rethinking the way Snapchat works could open up a huge audience of new users – or, even better, a new purpose for the platform.

Today’s marketers (and investors) are looking at Snapchat as a social media platform versus taking into consideration Snap’s advancements in other areas of technology, such as augmented reality and original content. These characteristics resonate best with TV, so why aren’t we comparing it more to the big screen? Recent deals with top TV networks, such as Turner, NBCU and Discovery Communications, suggest there is a strength beyond what meets the social-media eye.

I’m not the only one seeing this angle. Industry experts from Forrester suggest that Snapchat could compete with the likes of Viacom’s networks, including VH1, Nickelodeon and Comedy Central, which generated $4.8 billion in ad revenue last year. And recently, the Television Academy signed a three-year contract to expand coverage by creating Snap Stories that capture personal and behind-the-scenes moments at the Emmys.

To put Snap in the proper context, think back to the era of “Must-See TV” where families sat down at the same time each night to tune in to the most-watched, most-popular TV show of the time. It was much easier then for brands and advertisers to operate. Brands could showcase their new product or service to people who were fully engaged in one program for a specific amount of time, and they could do so without multiscreen distractions. It was the era of putting great creative in front of a large audience, in an attempt to convince some of them to add the product or service to tomorrow’s shopping list.

We’ve gone a little off course since then, thanks to the evolution of multi-screening, streaming and recording and on-demand services. These advancements have been great for consumers, but have in turn made the jobs of many TV buyers a lot harder, nearly stripping them of the control they once had. Until now.

With Snapchat, everyday users, publishers or celebrities can post their own content in real time to millions of global viewers who are constantly scrolling through their feeds searching for their next unwatched story. It’s addicting. And it’s keeping users’ attention on the small screen at a time when 47% of millenials and Gen Xers are unreachable by traditional TV measurements.

So what does this mean for advertisers? Don’t treat Snap like a social network. The same creative that works on Facebook and Twitter will not work here. The ad format is different. The audience is different, and the context is different. Think about what engages people on the big screen. It’s about storytelling. Brands must bring their best sight, sound and motion, and pack it in under 10 seconds.

Furthermore, measurement of Snap Ads should be more akin to television. Think about reach and frequency against the target audience. Track engagement rates and benchmark against video ads on other channels.

read more here: adexchanger.com

The Holy Grail of TV Advertising – Are You Missing Out?

Digital advertising is exploding across screens. The associated growth of digital attribution models used to measure performance has led to the idea that linear TV advertising is not as effective as it once was. However, TV IS still driving sales. I see it every day and I experience it myself in my own purchase decisions. Linear TV advertising is still the most effective way to reach consumers at scale, is proven to be a major sales driver and is the fuel for lower funnel conversion activity.

A recent study published by Neustar found that for a $1 million investment, TV’s lift is consistently seven times better than paid search and five times better than online display advertising. That’s pretty significant, and as such, it’s top of mind for advertisers to make sure they are leveraging TV advertising to increase their sales.

Direct attribution – especially for linear TV – has always been tough to achieve, but it’s not impossible. In fact, I posit that the “Holy Grail” of TV advertising is finally upon us, and advertisers can (and should) plan, manage and measure TV with the precision traditionally expected of digital screens.

Here I outline the top three things you should incorporate into your advertising strategies if you want to achieve the “Holy Grail” in TV advertising.

1. Greater TV Advertising Automation

Automation in TV is fairly new. Many in the business aren’t even aware it’s being done. It definitely can and is being achieved by leading players in our space, but very few have true clarity on what can be done and how best to apply it. As companies continue to innovate and advance, we’re going to start seeing automation in TV advertising being implemented more and more.

So, why is it important? Automation is especially important in that it brings additional data to TV. With the amount of data that is being applied to TV advertising, it would take ages to process it without using technology. Automation speeds up the entire TV advertising process, allows for the creation of custom strategic targeting – leading to more accurate targeting, provides in-depth reporting and also allows for increased transparency and control.

2. Linking Your Digital Investments to Your TV Investments

Once you’ve applied the data to your investments, you can link it across screens. As an advertiser looking to target specifically on TV, you know how important it is to invest in both TV and digital advertising, but do you realize the importance of linking both investments together?

Just last year, the Advertising Research Foundation (ARF) released an in-depth research study analyzing the state of advertising, based on over 5,000 campaigns, 12 years of data, $375B in advertising spend in 41 countries, across over 100 categories. The study revealed that spending across multiple platforms delivers greater ROI than any single platform. And in turn, the study found that “silo-investing” – too much frequency via a single platform—can lead to diminishing returns.

It’s important to link your digital investments to your TV investments; doing so will allow you to measure how your digital investment is performing, and then use that data to better inform your TV strategy – ultimately, having both investments working more closely together. As an advertiser, you should start tagging your campaigns on digital to see who is converting online, then utilize that data to focus your TV buying strategy. Linking both investments together yields the best results time and time again.

3. Closed-loop Attribution Across TV and Digital

Now this is arguably the biggest piece of the pie in achieving the “Holy Grail” in TV advertising. The ability to identify which TV ads drove conversions, is a concept many advertisers don’t even realize exists, but it’s here. For example, pixeling your website to understand conversions and activities can be directly tied back to TV’s exposure, showing us what’s most effective in driving consumer engagement.

To determine the true ROI of your advertising, it’s critical to measure your investments holistically across devices. In other words, closing the loop on attribution across your TV and digital investments to ensure that they are truly measuring how TV is contributing to overall performance; then, combine the results for true measurement, using a common metric. This is the only way to see what your advertising campaigns are really achieving, and in turn, improve your marketing strategy in future campaigns.

read more here: www.broadcastingcable.com

TV ‘tribes’ drive service provider success

A survey of consumer behaviour has revealed five types of ‘Television Tribe’, each with very different patterns in the way they consume and pay for content. The study, Television Tribes, from content protection and multiscreen television solutions provider NAGRA, in partnership with TV industry research firm Ampere Analysis, highlights the new reality of pay-TV consumer viewing types and outlines how operators can unlock new revenue opportunities by catering to their complex needs with relevant content, experiences and technology.

The study, which surveyed consumers across ten advanced countries globally, identifies five unique ‘Television Tribes’:

– Content Connoisseurs – a young, affluent and tech-savvy early adopter group who want everything on demand and are willing to pay for it. They are also the most likely to churn.

– Broadcast Bingers – a low-spending group best entertained when binge watching box sets.
Digitally Detached – an older generation, harder to reach and least likely to spend money on pay-TV content.

– TV Traditionalists – a middle-aged group of linear TV consumers most interested in the big screen, and particularly in sports

– Super Spenders – linear TV experts with money to spend to have full bundle access to content

The research focuses on the Content Connoisseurs, the most valuable and fastest-growing consumer type, but also the most demanding, making up 24 percent of the global market. They are the biggest spenders, love their content and consume significantly more from SVoD sources than the average household. They want to assemble their own à la carte TV bundles and expect high-quality experiences across devices.

Nearly 80 per cent of Content Connoisseurs cite online video platforms as their main source of TV and film content. They also predict their household will stop watching linear TV completely within five years, but their love of content makes them the most likely Tribe to subscribe to pay-TV services.

TV Traditionalists are the second most valuable Tribe for pay-TV operators. Representing 18 per cent of market share, they are often overlooked in the multi-device and OTT era. This group is willing to pay for core TV services, including access to live sports and movies. They are also less likely to churn than any other Tribe, with only 9 per cent saying they switched within the last six months.

The study goes further to identify key actions operators can undertake to help defend their position in a fast-changing environment, including: stacking the right services for each market segment, leveraging IP and cloud technology to launch new on-demand services quickly and cost-effectively, delivering a class-leading multiscreen user experience by embracing data analytics to improve customer insight and personalisation. Securing premium content across all screens and fighting online piracy also take on a new dimension in a more demanding always-connected market environment.

“As the distinction between conventional pay-TV and OTT services blurs, understanding these TV tribes, which ones are the most valuable, and keeping them happy with compelling content, experiences and technology, is the first step for operators to unlock new opportunities and remain relevant in a new pay-TV era,” said Ivan Verbesselt, SVP Group Marketing, NAGRA. “A one-size-fits-all strategy will not maximise value. Meeting the needs of distinct segments of consumers is the key to attracting and retaining subscribers, and growing revenue. The successful operators of the future will be those who accelerate their transition to IP to gain more flexibility and meet evolving and diverse content consumption needs, enabling tech-savvy consumers to create their own next-generation bundle of TV and on-demand services.”

read more here: advanced-television.com

Several Things the TV Advertising Industry Should be Worried About

GroupM’s ‘The State of Video 2017’ report released today doesn’t forecast the doom and gloom for linear TV that some are predicting. With TV making up 60 percent of the world’s traditional media spend, and still rising, GroupM says that TV is seen by many advertisers as essential for brand building and still represents “the peak of consumer engagement”. However, TV is still facing a number of serious challenges GroupM have set out some of its concerns about its future as an advertising medium.

Rising costs but declining audiences

The decline of TV audiences are often overstated, with much of the audience of linear having switched to digital platforms instead. But traditional TV viewing is falling as younger generations turn away from linear – GenY viewership has fallen by about 4.5 percent annually in the UK and US, and for GenZ the figure is close to 9 percent. GroupM finds that aging does not increase people’s viewing like it used to, and predicts that aging GenY and GenZ audiences will erode viewing at a pace of one percentage point a year over the next decade.

Meanwhile rights costs are rising fast, especially for sports, where high loyalty and engagement ratings have seen investments in rights and ad dollars spent on sports rise quickly. But even with sports, GroupM says younger generations aren’t as attracted as older groups, and sports in the future might not guarantee the same huge audiences they do today. Continued audience loss and fragmentation could make it impossible to sufficiently monetise content for linear broadcasters to cover its growing cost.

The threat of the digital giants

Traditional broadcasters will struggle to compete for audiences and programming with the likes of Netflix and Amazon, whose economic model is currently based solely on growth rather than profitability. Netflix and Amazon are estimated to spend around $10 billion per year on content acquisition and creation, and offer a tempting opposition to the emerging ‘skinny bundles’ of limited channels and networks, especially to viewers not interested in sports. “If you are a sports fan and impatient, it is complex and expensive to get everything you want,” says the report, “If you are neither, it is easy and cheap – go to Netflix or Amazon.”

GroupM say that no national media company has the resources to compete with these players on a global basis, and that it won’t be a surprise if Amazon Prime and Netflix come to form the anchor of the new entertainment landscape.

TV’s long tail under pressure

The long tail of TV, the lowly viewed niche channels that come with pay-TV packages, faces threats on two fronts. The cheap inventory on these channels has helped mitigate TV ad inflation in the past, but the emergence of on-demand video is making TV’s second rate ad inventory on these niche channels hard to sell. The report says these channels in the past held a sort of quasi-on-demand status, offering a certain type of content at any time of day, a status it’s losing in competition with actual on-demand.

Partly as a result of this, networks and broadcaster themselves are now offering stripped-back ‘skinny bundles’, free of these long tail channels, and as these bundles become more mainstream, the economics of long-tail channels and programmes will come under even more pressure.

TV measurement is still inadequate

Viewing measurement has not kept pace with changes in viewing habits, with a lot of content now watched on poorly measured or completely unmeasured screens. Even where there is measurement viewing standards vary, making total measurements of a show’s audience inaccurate and making it harder to monetise to its full value. GroupM says that the loss of linear audiences is largely an illusion, but until a holistic method of measurement with common standards across platforms and devices exists, TV shows will remain undervalued. What is necessary according to the report is “a universal, any-screen, respondent-level method with automatic content recognition.”

Long commercial breaks becoming unacceptable

With SVOD services like Netflix giving audiences ad-free viewing, and short-form online content being supported by short and often skippable ads, audiences are becoming intolerant of the long ad breaks featured on linear TV. Channels are now having to experiment with shorter, less intrusive breaks in the hopes that linear audiences will stabilise or grow, and that advertisers would be willing to pay a higher premium for this more effective inventory. The report advises that TV must make its advertising more relevant, making it more native to its environment and more audience-friendly.

read more here: videoadnews.com

Survey Suggests Video Audience Is at Tipping Point

New data from Hub Research suggests that TV watching habits may be at a tipping point, with the majority of US TV viewers saying they mainly watch their favorite show via a digital source.

Primary Way in Which US TV Viewers Watch Their Favorite TV Show, 2014-2017 (% of respondents)

According to the latest edition of the firm’s annual “Conquering Content” report, 52% of respondents said they primarily watch their favorite show through online sources such as Netflix.

That represents a sharp change from 2014, when just 31% opted for digital sources.

Not surprisingly, Netflix is a key source for viewers, although the Hub Research survey found it still trailed live TV as the preferred option for watching a favorite show. When asked, “How do you watch your favorite show?” some 31% said “on live TV,” while 29% said Netflix. Just four years ago, the split was nowhere near as close, with 45% picking live TV and just 14% picking Netflix.

The shift to online sources doesn’t necessarily mean a viewer is lost for traditional TV platforms. When the survey asked if viewers had ever discovered a show online and then later watched it on regular TV, 57% said they had done so, slightly more than a year prior.

Preferred Devices for Viewing TV Shows According to Internet Users Worldwide, 2016 & 2017 (% of respondents)

Hub Research’s latest findings echo the results of a worldwide survey from Accenture, which found a more dramatic shift. The April 2017 Accenture study, which surveyed 26,000 internet users across the globe, found just 23% of respondents would rather watch TV shows in a traditional fashion.

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TV: Riding The Tide Of Emotions

VAB has often demonstrated the undeniable ability of TV to drive business growth, but in this report they explore the emotional impact of television. Television programming satisfies our human emotional need for connection; a connection not only to the characters and stories that resonate with us, but also the desire for a shared experience with our community.

download the report here

The emotional bond many of us feel with Television programming is made clear by…

• The amount of time & attention we give it – 5+ hrs a day, double what we spend eating, drinking,
shopping and viewing Facebook, combined

• Our insatiability for more content from the shows we love – 52 Million Facebook Followers of the top 5
shows alone

• The urgency we feel to rejoin the stories we loyally follow – 88% of primetime is viewed live
Emotionally compelling, character-driven premium programming fosters an ideal environment to showcase an advertisers
message. But why is this important for advertisers?

• 90% of human decision making is dictated by emotion

• 85% of consumer purchases are driven by emotional attachment

• And 58% of consumers believe TV is where they are most likely to find advertising that makes them feel
emotional (a figure 6x greater than that of Social media)

Streaming Piracy to Total $52 Billion in Losses by 2022

Worldwide revenue lost to online TV and movie piracy grew from $6.7 billion in 2010 to $31.8 billion this year, and will increase to $51.6 billion in 2022, forecasts London-based Digital TV Research. Those figures don’t include online sports piracy.

Revenues from legitimate streaming sources overtook piracy losses in 2013, and since then the gap has been widening. Legitimate revenue totaled $6.1 billion in 2010, grew to $46.5 billion this year, and should hit $83.4 billion in 2022.

While the amount lost to piracy is increasing, Digital TV Research sees its growth rate declining thanks to government enforcement efforts and consumers getting easy and affordable legal streaming options.

While North America is currently the largest region for online piracy, Asia Pacific will take the lead in 2018. By 2022, that region’s piracy losses will double to almost $20 billion. The top five countries for piracy loss are the U.S., China, Brazil, the U.K., and South Korea. The U.S. will stay in the top spot in 2022, Digital TV Research forecasts, while India—currently in the eighth spot with $700 million in losses—will climb to number 3 in 2022 with $3.1 billion in losses. China’s efforts to reduce piracy will help legitimate revenues overtake losses by 2022.

This data comes from Digital TV Research’s October 2017 piracy report, which sells for £1200.00.

YouTube living room viewing up 70%

Viewers now watch more than 100 million hours of YouTube in the living room every day, up 70% compared to last year, according to Alphabet CEO Sundar Pichai.

Speaking on the Google parent company’s third quarter earnings call, Pichai said that YouTube users spend an average of 60 minutes a day on mobile – but noted that growth “isn’t just happening on desktop”.

YouTube’s living room expansion comes as the video service continues to invest in new subscription models – particularly in the US where its live television service YouTube TV is now available across two thirds of the country.

“YouTube Red, our first foray into the subscription market, is on track to release over 40 original shows this year,” added Pichai.

YouTube claims more than 1.5 billion users globally and Pichai said that ads on the video service “continue to deliver the highest viewability rates in the industry”.

“YouTube now has a 95% ad viewability rate, which is significantly higher than the average 66% viewability rate of other video ads,” he said, noting an “industry shift to six-second bumper ads”.

On the call, Pichai described YouTube as one of Alphabet’s “three big bets” – alongside Google Cloud and its hardware business, which recently launched a host of products including the Google Home Mini voice assistant and Google’s flagship Pixel 2 smartphone.

“YouTube continues to see phenomenal growth as the premier global destination where people go to watch video,” said Pichai.

“Three of the key areas we are focused on are strengthening the existing community, continuing to drive growth, and expanding our subscriptions business. On the community side, we are helping create meaningfully interactions that bring creators and fans closer together.”

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OTT Platforms: If Cable Networks Can’t Beat Them, It’s Time To Join ‘Em

Last month, Nielsen painted a rather alarming picture for cable networks. – by Tyler Pietz

Despite an increase in the total number of TV homes (+1%), traditional cable subscriptions have continued to decline at an accelerated pace (-3.1%), Nielsen said [PDF]. Taken in totality, this suggests a widening gap of -3.9% in cable subscription growth as a proportion of total TV homes.

VMVPD subscriptions, such as Sling TV, Playstation Vue and DirecTV Now, often dubbed skinny bundles, have grown, but at slower rate than necessary to sufficiently make up for the declines in traditional cable subscriptions.

Skinny bundles are inherently less lucrative than traditional subscriptions for distributors and networks because the smaller number of channels erodes cable network penetration on a per-subscriber basis. And since the regional monopolies, equipment rental fees and contractual lock-ins historically enjoyed by cable operators are effectively eliminated, the bundles also put downward pressure on margins due to increased competition from other providers.

This underlines the precarious position of traditional cable bundles: In an effort to address weakening demand for a highly lucrative revenue stream – traditional cable subscriptions – distributors have introduced a less lucrative one that has so far failed to close the gap in subscribers, let alone revenue.

But while the shift toward OTT content delivery (which runs through operators’ pipes) and a lax regulatory environment (which opens the door to payments from platforms to prioritize their traffic) will help operators absorb losses, networks have little to take solace in.

Cable networks have historically operated as franchisors, focusing on creating, acquiring and programming content while relegating to their affiliates – cable operators – the messy business of bundling and selling access to their content in exchange for a per-subscriber fee. This worked when consumers had little choice in the matter, but cord-cutting and shaving has become an increasingly viable option as more direct-to-consumer offerings emerge and negate the hegemony once enjoyed by operators.

This leaves cable networks with a few choices, none of which are easy or particularly attractive compared to their legacy businesses.

Do Nothing (Base Case)

If recent trends hold, the average network will see a significant erosion of its traditional subscriber base year over year for the foreseeable future. Beyond the hit to affiliate revenue, which is now the primary revenue stream for most networks, this will also endanger ad revenues as TV ad rates are predicated on reach. Lower viewership density equals fewer eyeballs to monetize and threatens the utility that networks offer to advertisers as an easy button that taps into most, if not all, households.

Realistically, the only lever that networks can pull under this scenario is to demand an increase in the fee that cable operators pay per subscription. Operators have shown an increased aversion to abetting these increases, as these costs are passed directly to the consumer, creating a vicious cycle that makes bundle economics less tenable for current subscribers.

Develop Assets That Can Stand On Their Own

Most cable networks spread their content over several channels or properties, each of which commands its own subscriber fee. Demand for lesser properties will weaken significantly in a higher-choice environment, so networks need to focus on quality-over-quantity products that can command a loyal audience in an increasingly unbundled world, even if those audiences are smaller and more niche.

Beyond the world of linear content delivery, there is great demand at companies such as Netflix, Amazon and Hulu for high-quality, creator-driven video content, such as “Breaking Bad” and “Fargo.” Licensing these shows already brings in nontrivial revenue for networks such as AMC and FX, but windowing – where they are made available six or more months after the original air date, to avoid cannibalizing live TV audiences – limits this revenue stream.

And as TV ad revenues decline with audiences, networks with the luxury of owning the rights to such coveted content should get serious about day-and-date distribution on digital platforms to fully realize the value of their content.

Create A Discrete Direct-To-Consumer Bundle

Direct-to-consumer businesses, when executed correctly, confer extraordinary benefits on their owners, particularly in the form of user data that can be utilized for serving highly targeted ads and the ability to measure viewership data with precision and granularity.

But the lift is much heavier, and the stakes are higher. A move into direct-to-consumer necessitates a type of business acumen and degree of technical and product excellence that is currently lacking at most cable networks. It will involve creating business models that networks have never battle-tested at scale.

Disney, having recently announced plans to develop its own OTT subscription service, may serve as the ultimate bellwether in this case. But with service expected to launch no earlier than the second half of 2019, the hand-wringing decisions and harsh realities of such a strategy are already rearing their ugly heads. Namely, the success of the new venture will be predicated on Disney’s willingness to pivot from revenue streams that will be more profitable in the short term but recede in the long term.

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