For media owners, the streaming wars reached a fever pitch in 2020. Viewership doubled as a result of the ongoing pandemic, with household-bound audiences turning to over-the-top (OTT) and connected TV (CTV) programming to stay informed and entertained. Premier streaming bundles such as Peacock and HBO Max hit the market at an opportune time, and Disney+ registered over 73 million subscribers in its first year. The wars even claimed their first victims, including the much-hyped but short-lived Quibi.
But for all the excitement around these Netflix-like offerings, the crowded field also showed signs of fatigue. Consumers can only afford so many stand-alone subscriptions. In fact, across the US, EMEA, and APAC, the majority of streamers prefer to watch free content rather than a paid service (one of many insights included in SpotX’s 2021 Global Video Advertising Trends report).
Ad-supported video is arguably the biggest opportunity in streaming today. According to Samsung Ads proprietary data, ad-supported video on demand (AVOD) accounts for roughly 70% of smart TV viewers, who watch an average of 84 minutes per day. AVOD revenue is projected to double by 2025, outpacing paid subscription growth, and on track to represent a third of total OTT revenue.
Capitalizing on this shift will require media owners to rethink the traditional advertising playbook. Streamers have high expectations of the viewing experience, not to mention unlimited content alternatives at their fingertips. A viewer-first approach is necessary to make sure your AVOD offerings are positioned for success in the year ahead.
Better ad frequency management
Most streamers are familiar with the experience of a single ad recurring multiple times throughout an episode (or even the same ad break). What should be simple has for years been overcomplicated by legacy pipes that struggle to dynamically fill OTT impressions. Advanced podding solutions can solve this problem for media owners, facilitating greater depth in demand for each pod fill, which in turn drives more seamless transitions, fewer duplicated ads, and more engaged viewers.
Greater advertiser variety
Ad breaks are most appealing when they feature a diverse range of products and messages that are relevant to the viewer. Media owners can expand their pool of advertisers and maximize demand by supporting multiple deal types, including direct-sold, programmatic, and transacting in private and open marketplaces. Curated inventory packages can further entice advertisers to spend incremental budgets on specific genres — for example, wellness, family-friendly, or gaming categories.
Personalized, data-driven campaigns
In addition to variety, audiences also want ads that are relevant. In fact, 90% of consumers find personalized ads appealing, and they’re more likely to purchase a product when targeted with these messages. Personalized and relevant campaigns can be powered by contextual targeting or targeting with first- and third-party data via DMPs that can identify consumer segments such as “auto intenders” or “married couples with kids.” Audience-based targeting is key to helping advertisers run more efficient campaigns while matching viewers with the right message at the right time.
Stronger brand safety
Audiences are consuming content from a broader range of publishers than ever, and are more cognizant of the contexts in which they discover and engage with content online. Highly partisan videos or misinformation campaigns routinely generate backlash across social media platforms, leading to lost viewers and concerned advertisers. Advertisers are more cautious in their approaches to brand safety and suitability, and media owners need to be proactive in helping them root out any brand safety concerns. This can include a multi-pronged approach of real-time verification technology, content categorization, as well as continuously updated inclusion- and exclusion-list policies. Focusing on ad quality and brand-safe environments from both the buy- and sell-sides ensures a positive experience for viewers.
Live streaming events
While traditional TV retains its hold on many households, media owners can’t ignore the growing tide of cord-cutters and cord-nevers who are turning to streaming for live events. As many viewers continue to tune into rather than attend sports and events in 2021, make sure you have the programmatic tools in place to monetize live OTT and CTV content, including server-side ad insertion (SSAI) that can handle high spikes in concurrent viewing and ensure a smooth viewer experience through ad breaks and content.
With greater attention on the behaviors and preferences of streaming audiences, media owners can tap into the huge wave of growth in AVOD in 2021 and beyond, garnering greater market share and increased ad budgets, and positioning their business for success in the post-cable future.
As Content Marketing Manager, Rachel Sullivan leads SpotX’s content strategy. She helps shape the stories, insights, and news that leaders across the advertising ecosystem need to advance the industry. Rachel previously managed B2B content and digital marketing for a range of emerging technology companies and has both agency and in-house experience. Outside of work, you can find her traveling the world or exploring her home of New York City.