Prepare for Generation Stream. Julie DeTraglia Showcases Hulu's Streaming TV Research

Generation Stream is Hulu’s term for those “culturesetters” who are on the forefront of cultural change and whose media consumption is mostly or completely streamed video. No longer gathered around the television set with family members, these individuals are best categorized as the harbingers of media-to-come. 

But who are they really? Hulu decided to find out by conducting a major study in April 2020. Julie DeTraglia, Head of Research for Hulu designed the study, first with a primary component that queried 20 diverse “Culturesetters” ages 16 to 44. Then, using insights gleaned from that group, she launched a national survey of 2,500+ diverse Gen Zs, Millennials and Gen Xers, ages 13 to 54. According to DeTraglia, “We tested trends and further explored streaming behavior and preferences. The result included an expansive multi-chapter report, testimonials and curated videos on streaming trends, types, behaviors, classifiers and reactions/preferences around advertising in streaming.”

Overall Trends

Generally speaking, DeTraglia found that the 13-54 year olds polled in the study were either heavy users of streaming services or intended to subscribe to a streaming service. This indicates a further advancement of streaming as a more dominant form of media consumption in the coming years. “Diving into the experiences and moods of Generation Stream further cements streaming TV as a foundational part of a viewer’s day,” she explained.  The study found that:

        90% view TV and movie content on a video streaming platform

        75% fill their media consumption time streaming or mostly streaming the video content

        Among non-streamers, 57% anticipate subscribing to a streaming service within the next 5 years

Generation Stream

Generation Stream is the prevailing consumer segment, representing 90% of all 13-54 year old Americans who stream content. And they love streaming content. According to the findings, 91% of Generation Stream would give up their music streaming service, social media, favorite food, favorite fashion item and favorite brand before they gave up their video streaming service. In fact, the only thing other than video streaming they aren’t willing to give up is their hair.

DeTraglia pointed out that, “The ripple effect of streaming is as powerful as it is universal. Virtually all (95%) of Generation Stream say streaming has changed their viewing experience in at least one way, from being able to binge content to having more control over their viewing experience to watching

niche content.” Streaming enables this cohort to watch totally on demand. “They are untethered from the 24-hour day, primetime slots, Nielsen ratings, or set commercial breaks, content has newfound wiggle room,” she added. But this brings with it added expectations for more left-of-center shows, more multidimensional characters, more bingeable seasons and generally more content. Over one-third (35%) of Generation Stream says, because of streaming, they watch more content than ever before it is changing their viewing behavior and expectations.

Diving down a little deeper, Generation Stream falls into three key segments of behaviors - Those who are Stream Only (37%), Stream Most (47%) and Stream Also (16%).For Hulu specifically, 86% of Hulu subscribers fall into the top two groups - Stream Only (41%) and Stream Most (45%).

The way Generation Stream uses streaming services fall into four behavioral types:  

1.       Classic: These viewers tend to stream content in the same manner as people watch traditional TV—at set times, with family, friends or a partner and as part of a daily routine.

2.       Curated: This group is more selective in their streaming content, centering on intelligent, niche and global content that is more than just pure entertainment. They tend to favor shows and movies that spur a cultural conversation to connect them with like-minded communities.

3.       Therapeutic: This group favors streaming content that is more meditative and therapeutic, presumably because it reminds them of childhood, or enables them to lightly reflect.

4.       Indulgent: This group favors streaming content that is totally immersive. They enjoy being fully consumed with shows, ‘holing up’ for a weekend solo to binge through several seasons of a favored program.

The results of this study will help inform the industry going forward. “The insights in this report uncover what inspires and moves this audience, so that Hulu and our partners can connect with them in meaningful ways, with content, brands and advertising. By exploring this coveted audience, who has been watching TV in a streaming environment for over a decade, ‘Generation Stream’ helps us understand the why, who and how of streaming TV viewers, and will continue to do so in the coming reports,” she concluded.

This article first appeared in www.MediaVillage.com

Hulu Knows the Secret of Digital Fluency

If there is one longstanding bias that permeates the media industry, it is that older adults are techno-phobic. We’ve written long analyses as to why that is not so but the overall prejudice still exists … until now. Hulu has just released the second phase of a study that examines digital fluency by consumer segmentation that transcends age.  

What Hulu has found, according to Julie DeTraglia, Hulu’s Head of Research, is that the actual enjoyment of technology is a better indicator of digital fluency than age. She defines digital fluency as, “comfort with technology and a willingness to interact that way with all types of categories and brands.”

The Journey to Understanding

“We really didn’t set out to do this specific type of study,” she explained. Previously, “we did a generational study where we concentrated on the differences in television behavior between Gen X, Gen Y and Gen Z,” and saw differences in television behavior. The intent was to simply do a follow-up to that study, folding in other types of behaviors across other categories, attitudes towards advertising and brand relationships. But, “as we started brainstorming, we realized that it is not just Gen Z that has changed. Everybody has changed,” and this change has occurred across all generations.

What she found was that people of all ages changed behaviors and attitudes, becoming more digitally fluent as opportunities for convenience became available. Her example was Uber; “We were taught from childhood never to get into a car with a stranger. But now we are doing it all the time,” she noted, because of the convenience of on-demand car service.

The Big Takeaway

“So we tried to understand what that journey is and how people identified themselves and the identity they had around technology,” she stated. That study was released last year at Advertising Week. Hulu studied digital behavior and identity and found that the consumer spectrum was segmented in a way that age was essentially a non-issue. According to DeTraglia, “The one thing that moves people across the spectrum is the enjoyment, happiness and inspiration they get from technology,” and this parses out relatively equally across age ranges.

“The more digitally fluent people use technology often and derive a lot of happiness with their digital connections,” she explained, “People in the middle use technology to make their lives easier but they are not necessarily getting joy from it. Then there are those people who we call minimalists who use technology because it’s the way they can get things done, but they don’t really love it.” But, “one of our biggest insights was that age is not a factor,” she confided. Just as many young people as older described themselves as minimalists on the digital spectrum - 19% of Gen Z compared to 16% of Boomers. But why?

“It could be that Gen Z is interpreting the questions differently than older generations,” she posited. “Or maybe they are just a little more overwhelmed by it,” since they are so immersed, for example, in social media that is ‘on’ all the time.

In the second phase of the study, just released in time for this year’s Advertising Week, segmentations were created around motivations and behaviors and “that is where we saw the segmentations flatten out a bit. Most people define themselves a somewhere in the middle, but when you do a segmentation, there were just about equal percentages of all of the segments,” from low to high. DeTraglia noted that technology prompts behavioral change. Take for example streaming video. One might start in the living room, then move into the bedroom and then onto a computer or tablet. Once content becomes available on smart TV’s Hulu saw that consumers transitioned back to the living room.  That then leads to more comfort with technology and can lead to transactions and shopping.

Conclusions

What DeTraglia saw in this brand study phase, was that advertisers should adjust their creative so there is differentiation between the digital fluency segments. “It is no longer one-size-fits-all,” she explained. “Truly digitally fluent people should get different ads,” according to the viewing environment and platform.

“Hulu has worked hard to come up with ad products that can work in different ways, depending on what your needs are. For those who are more digitally fluent, they want messaging that is more personalized. They want to interact with the creative. They want more personal connection and control and relevance,” whereas other less fluent groups just want to be informed with messaging that remains clear. Advertisers, take note.

Changing the Advertising Model. An Interview with Hulu’s Peter Naylor

Hulu continues to keep up with the times. When it first launched 11 years ago it was 100% desktop delivered. Now, according to Peter Naylor, Hulu’s Senior Vice President of Ad Sales, the company is 6% desktop, 80% living room and 100% subscriber driven.

“It’s all about choice and control,” he explained at the recent VideoNuze conference, with three different types of subscription services depending if you want ad free or not and multi-member access. Naylor calculated that 82 million people watch Hulu per month with 70% opting for the ad supported version of the service.

Hulu’s mission is relevancy and being respectful of the viewer experience. “Our subscribers come to us for content,” he explained, and they have ample choice with an inventory of 85,000 TV episodes. Disney recently announced that they are planning to completely acquire Hulu. For Naylor this offers great opportunity for the streaming service. “Control by one owner enables us to move faster and invest more in content,” he stated, “Our international expansion will accelerate. So we will keep doing what we are doing. We have the wind in our sales.”

Ad Pod Length Consistency

Part of Hulu’s success has to be its commitment to consistency and standardization in a world of multiple choices for both the viewer and the business. In striving for consistent experiences for viewers, Naylor has had to address the inconsistencies in ad pod lengths. “There was a time when different shows had different ad pod lengths,” he explained, “but now all pods are capped at 90 seconds or less with a countdown clock. And we don’t put ads where you don’t expect them to be. We try to be thoughtful and also add as much value as possible.”

Further, “100% of our advertising is addressable and we only charge for ads that are completed.” Naylor and his team are data focused and also pay great attention to social media to discern what consumers find valuable and objectionable in their viewing experiences. “You can’t jam more ads in because you need to make a number,” he warned, because viewers have a lot more content choices.

New Types of Ad Deliveries

“The more time people view on demand, the more likely they are to have two to three services and the more time they spend online,” he noted. With multiple subscriptions, Hulu has to be very careful about ad overload and irrelevancy. “We are trying to figure out non-intrusive ad models.” To that end, Hulu created pause ads which places a static contextual ad (like a coffee advertiser) on the screen when a viewer presses the pause button. They are also rolling out a binge watching ad product in fourth quarter for those who watch three or more episodes in a row. “We will identify ‘bangers’ and feed them contextual ads such as ‘Feed Yourself.’ We make the third episode commercial-free if you watch this 90 second ad. We want to reinvent the ad model.”

For Naylor, there exists a full spectrum of ad acceptance. “It doesn’t have much to do with age income or geography,” he noted, “It has to do with your culture and interests. We strive to make ads more relevant and when you use data properly, relevance skyrockets. There will always be ad avoiders,” he added, “but they are a minority.”

When asked how much an ad’s creative factors into Hulu’s decision about where and how to place an ad, Naylor responded, “Ensuring creative is relevant to the person watching is fundamental to a viewer-first advertising experience. A relevant creative means a better experience for the viewer and better results for the advertiser.”

The Future

Naylor’s view of the future is focused on a world of connectedness and expansion, courtesy of technological innovations. “I can’t imagine a scenario where every television household in America isn’t someday connected to an IP address,” he explained. “While I don’t know what percentage of TV advertising is going to become addressable in the next two years or how long it will take us to get to a fully addressable future, I know the market is undeniably going in one direction with the help of market forces like 5G, ATSC 3.0 and the rise of on-demand, OTT viewing.”

He sees Hulu’s dominant place in the media firmament. “Today Hulu is the largest fully addressable marketplace in OTT, offering brands the opportunity to target and reach valuable audiences that are no longer found in broadcast television or via MVPDs,” he stated, “We’re offering the best of both television and digital and brands are coming to realize that OTT should be their first stop for TV in their marketing mix.”

This article first appeared in www.MediaVillage.com

Hulu’s Pause Advertising That Refreshes

Hulu has embarked onto new advertising terrain with their advancement of “pause advertising” and has just announced that they have signed up two beta advertisers, Coca Cola and Charmin to test the ad effectiveness and reception. The intent is to monitor the test through 1Q19 and then roll it out in 2Q19 in select content within the Hulu streaming library.

What is Pause Advertising?

If you have never heard of it before, pause advertising is messaging that runs during the time that viewers press pause on their remote or screen. Hulu and AT&T have both been testing these types of contextual ads with the belief that they might feel more relevant to viewers. And it just may.

The philosophy behind pause advertising is that it is viewer initiated and comes at a time of transition where contextual advertising can be even more effective. So it has greater resonance to the viewer while also creating more touchpoint moments for advertisers. Pause-able moments can include a bathroom break or snack time when viewers leave the room. And in Hulu’s preview video, it can also be viewable during multi-tasking times.  I can certainly relate to that. 

Why is it Effective?

For programmers, pause advertising also increases advertising inventory in, until recently, an unexplored area of content consumption, while still providing an uncluttered viewing environment. This is welcome news at a time when viewers are pushing back on clutter through the use of fast forwarding and ad-free subscriptions while networks are trying to find ways to shorten commercial pods while still meeting revenue goals.

But pausing also mutes audio. To overcome that obstacle, Hulu is featuring static slides without any need for audio along with a background gradient that distinguishes the ad from the content scene. This has gone through considerable testing and is proving to be effective. “We know that brands are vying for consumer attention more than before and need opportunities to tell their stories in authentic and non-intrusive ways, which is why Hulu is exploring formats like the pause ad,” explained Jeremy Helfand, VP, Head of Ad Platforms, Hulu.

How is it Measured?

At this time, Hulu will be using impressions as the measurement metric for the two beta advertising clients, probably using their own internal ad tech to do so. I don’t know of any capability to measure during mute from any syndicated measurement services as of this time but hopefully, if this type of advertising takes off, syndicated measurement solutions will be developed so this type of advertising will become standard industry-wide. “We’re going to be constantly assessing and iterating on the pause ad so may add additional metrics down the road for reporting,” stated Helfand.

Conclusion

As one who accesses content online, I have become used to advertising popping up pre-roll and mid-roll and as under lays while content streams. There is something less intrusive about ads that display during muted moments because at that time I am opting out of the content temporarily anyway. I suspect that pause advertising will feel less intrusive and disruptive to viewers … as long as they are still viewing the screen and not venturing off somewhere to get a beverage. But maybe before they go, a seed will be planted as to which beverage that should be.

This article first appeared in www.MediaVillage.com