What is Fast Becoming the Viewing Option of Choice for Many Viewers? It’s F.A.S.T.

It's no secret that connected TV (CTV) has been on a roll. U.S. CTV ad spend is expected to reach $14.12 billion in 2023, which is more than double the amount it garnered in 2016, according to eMarketer.

But a lot more information, some of which is surprising, recently emerged in Comcast Advertising's recent report, "Free Ad-Supported Streaming TV: Why More Advertisers (and Consumers) are Going F.A.S.T." It specifically focuses on CTV services that fall into the FAST category (free ad-supported television). FAST programming services -- which include XUMO, Tubi and Pluto -- offer both on-demand and linear viewing options, and they capture cord-cutting consumers. "This report was interesting in that it provided a full view of just how quickly FAST is growing," said Travis Flood, Director, Customer Insights, Effectv, a business unit within Comcast Advertising. "According to the report, FAST penetration among households has more than doubled year-over-year. And today, six out of 10 households who have connected TVs are using FAST services, either exclusively or in addition to other services." The report also shows that FAST services garner higher Net Promoter Scores (NPS), a metric that suggests viewers of the platform are satisfied and loyal. FAST distinguishes itself from other types of video services, such as subscription video on demand (SVOD) and advertising-based video on demand (AVOD), because it doesn't require a paid subscription or password -- and it offers both linear and on-demand content. With FAST, linear streaming channels are created using a specific technology that stitches VOD together to create linear viewability. "For advertisers, FAST provides a unique opportunity to reach cord-cutters while they are scrolling, channel surfing and discovering new content -- a prospect not possible through ad-free services like Netflix, or even from ad-supported on-demand services like Crackle," the report notes. "When creating our FAST report, we worked with XUMO to better understand how consumers are using FAST services today," Flood explained. (The XUMO service is also owned by Comcast.) The report shows that there is considerable viewer overlap with other streaming services, many of which are not ad-supported. Of XUMO viewers, 77% subscribe to Netflix, 80% subscribe to Hulu and 65% subscribe to Prime Video. While FAST content is available on all kinds of video devices, the screen of choice is usually the largest in the house, offering a lean-back viewing experience not unlike linear TV. Because of that, big-screen FAST viewers are prone to channel surfing. In fact, the report reveals that it's not unusual for viewers to land on FAST services without realizing it and then spend time engrossed in the content. This is especially true of cord-cutters, who don't have a cable program guide. The report also analyzes viewer preferences by genre on the XUMO service: "Crime TV, game shows and daytime TV are [among] the most popular genres on the service, behind news and movies," Flood said. "There is such a diverse mix of programming available on FAST services today, so it is very useful to understand the type of content users are gravitating towards." Fern Feistel, Vice President, Marketing & Content Operations at XUMO, noted that "the report shows an increasing appetite among viewers for series-based channels on FAST, services that [viewers] can tune to, lean back and binge. "These series-based, or theme-based, channels such as Baywatch or Fear Factor are resonating with audiences and represent one of the main differences between FAST and traditional TV offerings," she added. While measurement of FAST services is in the development stage, the report indicates that, generally speaking, FAST audiences spend considerable time on these services (about 104 minutes within a platform once they have entered). They also tend to be Millennials (a generation that values affordability, accessibility and nostalgic experiences through technology). These viewers are also open to advertising and don't mind ads if the content is free and if the breaks are short (75% of respondents). What's more, 69% of survey respondents said that they would consider replacing paid streaming services with ad-supported streaming services. That may be an indication of how FAST could change the video dynamics moving forward. What are some others? "It's hard to predict six months out, let alone three years from now," Feistel said. "But we anticipate continued growth in viewership because of the low barrier to entry and 'lean-back' viewing experience." She expects that FAST will continue to gain momentum with advertisers, "especially if FAST services continue to invest in ad technology to make their service more scalable and targetable for advertisers." Click here to download your copy of "Free Ad-Supported Streaming TV: Why More Advertisers (and Consumers) are Going F.A.S.T."

The Importance of Streamers. An Interview with Tubi’s Melinda Staros and Natalie Bastian

Since the pandemic, VOD has accelerated in its growth and acceptance among viewers, but its rapid progress is out-pacing our ability to assess its full impact on the media business. This is why Tubi’s recent study called, The Stream – 2021 Actionable Audience Insights for Brands, is a welcomed addition to our knowledge of the state and the future of AVOD for both advertisers and programmers.

The launch of this expansive study involved a partnership between Tubi, which is owned by FOX, and an impressive roster of first and third party data sources in order to match the quantitative with the qualitative results. For Tubi’s Natalie Bastian, Vice President Marketing, the study opened up, “a treasure trove of insights we had at our disposal because we are the platform and are so focused on data, tech and our audience. It is one of the best untold stories.”

The Stream, The Study

In offering an overview of the findings, Bastian explained, “The report looks at the broader shifts of content consumption, the rapid growth in streaming but specifically in AVOD and how AVOD is at a pivotal point of scale. We are going to see fundamental shifts in how brands are shifting their TV strategies especially going into upfront this year. Scale, targeting and measurement are all coming to a head. Because of our scale, (the results are) representative of the broader AVOD streaming audience.” The report is timed to maximize the value of AVOD in the upfront as an addition to linear. “This is our first proprietary research study,” she added, but not the last. The Stream is poised to be an ongoing assessment of the marketplace and the importance of AVOD in it. “This is our stamp and our voice,” regarding, “consumption and engagement and the reasons why consumers are gravitating to streaming platforms.”

The Stream, The Meta-Analysis

The study’s methodology was especially interesting to Melinda Staros, Tubi’s Director of Audience Research, “It was a meta-analysis of first party and third party data and our ability to thread that together. We used our first party audience data with all of our proprietary analytics – this was the first time we were using these to this scale.” The study also added Tubi’s qualitative research and, “all of the interviews we have done with our streamers for the past couple of years.” In addition, “We ran a custom B2B research study with Advertiser Perceptions,” which was then shared publicly and incorporated data from a number of different industry research sources such as MRI Simmons, TVSquared, Kantar and Nielsen. “There are many layers to peel back in this report,” she noted, “and it’s a compilation of all of these different methodologies and how they connect together.” The uniqueness of this study is its 360 degree holistic view of the industry.

The Stream, The Takeaways

For Staros, the study’s biggest takeaway, “has three layers. The first one is the industry where we found a discrepancy in the numbers. Seventy-nine percent of the people are streaming, growing daily and cutting the cord for cable. Streaming is so prevalent on the consumer side … and yet up to 90% of the video ad spend is still going to linear. There is a disconnection from the B2C side to the B2B side of the business.” But she is sure that will change in the next year. “From an audience perspective,” she continued, “it’s really the fact that it is incremental audience and that they are nationally representative. They are young and diverse as we see the national US population is. The industry isn’t necessarily used to that. The third is measurement. That is having substantial impact.”

For Bastian, an ah-ha insight was that, “When people in the marketplace talk about incremental reach the assumption is that it is incremental over linear TV. But what we found is that our audience is uniquely incremental to other streaming audiences as well.” She pointed out that while there is little overlap between Tubi and other AVOD audiences, there is some overlap between her service and Netflix which is not ad supported, thus enabling advertisers to reach those desirable audiences through Tubi. “We find that not only is our audience young, diverse and highly engaged, we can click into what they are watching, how long they are watching and when they are watching.” Tubi also boasts one of the lowest ad loads in TV – an average of 3 to 5 ads per hour.

The Stream, The Pandemic

While some industries have been negatively impacted by the pandemic, for Bastian, “The pandemic has across-the-board expedited the speed to stream for consumers.  It has accelerated launch efforts for other platforms to come to market,” but, she added, “I think that will level out over time. I think that over the next year, consumers will say, ‘wow, I’m spending so much money in streaming’… I think SVOD will level off and AVOD will continue to rise … especially free AVOD,” which includes Tubi.

“In terms of the numbers we are seeing, the pandemic has had a big impact on the sudden jump in the number of people streaming and the amount of time they spend streaming,” noted Staros who added, ”one in five people have cancelled their paid streaming service because of Covid and that was especially true of people ages 18-34 (at 33%) who tend to have lower household incomes and tend to be early adopters.”

The Stream, The Value to Advertisers and Programmers

For both Bastian and Staros, the value of AVOD and Tubi in particular to advertisers is a no-brainer.  Bastian explained that, “when you look at how linear and cable numbers are shifting and how streaming numbers are growing, you need to be able to diversify where you are spending your money.” She believes that buyers will pivot and make AVOD a must-buy with Tubi at the top of the list. “We have one of the largest, most engaged AVOD and we are nationally representative and we are highly targetable as well,” she stated.

For programmers, Staros shared that it is possible to take a program on linear that may skew older and, on a young platform like Tubi, age it down. “When FOX released the Masked Singer on its network, they had huge viewership, but it skewed significantly older,” she explained, “The big question was, if they put it on Tubi could they reach a younger audience or is the audience inherently older? The answer was that the platform dictates the type of viewership that you are going to get.”

The Stream, The Future

The future is bright for AVOD. “Streaming consumption is only going to continue … and in two years ad supported streaming will surpass cable … at a high level,” Bastian noted. The data supports this. “The more cord cutting, the more streaming, the more services, there are definite changes happening in the marketplace. The shift is really pronounced in that there are so many people who are not  going to be reachable through linear that at some point we are going to hit a threshold. They are saying by 2023,” Staros concluded. The future certainly looks exciting, especially for AVOD.

This article first appeared in www.MediaVillage.com

 

 

Explaining the CPM Increase in Media. An Interview with SQAD’s Marc Krigsman

Marc Krigsman has a deep background in TV from Fox Cable Network to Turner Networks Group, Cadent and Cross MediaWorks to becoming CEO of SQAD in 2015. 

“I have seen and been involved with many significant changes and advancements in television advertising,” he explained. So who better to assess the strength, opportunities, trends and challenges in pricing the media marketplace in 2020?

Charlene Weisler: What data does SQAD collect and what do you report?

Marc Krigsman: For more than four decades, SQAD has served as the industry source for ad cost data, processing more than $1 trillion in real transaction ad costs from advertising housekeeping system. This data is available through our MediaCosts platform and includes costs for national broadcast, cable, and syndicated television, as well as local broadcast, cable, and Hispanic TV, radio, and out-of-home advertising. We also provide audience analytics research tools for Nielsen data through our MediaLogic platform and provide advertisers and agencies with the industry’s leading media planning software, MediaTools.  

Weisler: How has audience fragmentation due to streaming, OTT, SVOD and cord-cutting impacted average unit ad costs on broadcast and cable if at all? Where do you see the trend?

Krigsman: It’s an interesting conundrum that we are in right now because as fragmentation occurs and audiences become more scattered there is still a revenue target outlets need to achieve for their inventory. So what is actually occurring is a CPM increase. That is because it is costing more to reach the same audience. As fragmentation happens, we’re seeing CPMs and rates go up.  Most in the industry thought that would not be the case, but in fact we are seeing an increase in prices. That also happens when you sell less inventory - CPMs go up. It’s a supply and demand issue. Fragmentation does not equate to a sale or reduction in prices. It is actually the opposite.

Weisler: What will the effect of increased audience based buying and impression based measurement be on unit ad costs and on advertising budgets?

Krigsman: The more focused and targeted you get, the more you are going to pay for that targeting. For some advertisers that makes sense. They will pay a premium to reach the audience they want to reach and only that audience. But other advertisers, CPG for example, don’t really care about pinpointing audiences. So for them addressable is not as efficient a buy.

The reality is that even with targeting you are still going to have waste. You have to be 100 percent clear about who the audience is you want to reach. You have to have a lot of audiences in your data to understand who your ideal customer is but when you do that the extras it takes to buy those segments will result in a higher price point.

For the seller, an advertiser using a targeted campaign to reach a limited HH, that means that they will have to fill their other inventory with other types of advertising if they can. The media outlet has to have confidence that the revenue they are getting from the targeted buy will be enough. They have to take into consideration that if it goes for a lower price, this will open an opportunity for bargain hunters looking for a bucket of impressions, not specific ones. Targeted buying could create opportunities for people who are looking for the opposite.

Weisler: What are the programming types that continue to command the highest CPMs?

Krigsman: Live shows, special events, news and sports – these are premier events that always command high CPMs because of their unique selling proposition in general. Overall you still have huge prices for traditional TV– sitcoms and other first run programming. But clearly live and special events are unique.

Weisler: How are live programs such as sports and awards shows faring in an environment where audiences are gravitating to watching highlights on-line? Does the data support this assumption? Press seems to infer that live programming delivers the most engaged audiences. Do you agree?

Krigsman: Programming that promote itself as unique or “watch it now” has the specialness of motivating viewers to want to watch it while it is happening, which always makes for an engaged audience.

Weisler: What can we expect for the CPMs of news programming as the presidential campaign season heats up? And how will data be best used to target independent voters? How is the tight inventory in local markets due to campaign buying impacting CPMs for advertisers?

Krigsman: History has shown that when there is a lot of pressure on inventory prices go up. From a national inventory perspective there will be a lot of pressure from PACs and other entities looking to support various issues and candidates. But most presidential advertising will be local rather than national. This will put pressure on local inventory and we will see an increase in those markets, but for only for a period of time, What traditionally happens is that those markets will go through to a period of  time and some of their core advertisers may not have available to them what they have had before.  But those local stations will then look to make goods following this period to offer to their bread and butter advertisers.

Weisler: How would you rate the TV ad market overall as we head into 2020?

Krigsman: The market is pretty healthy.  We are seeing a lot of increased pressure from other platforms but overall the ad market is healthy. People have a high level of confidence in the economy and when they do marketers spend against that confidence…that will reflect well in the ad market moving forward.

This article first appeared in Mediapost.com

Peter Katsingris Offers Insights From Nielsen’s Total Audience Report

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“Consumers have never been more connected than they are today,” stated Peter Katsingris, SVP, Nielsen Audience Insights. “Media consumption is no longer restricted to the living room but follows them wherever they go with the content of their choosing always within reach.”  

With Americans now spending an astounding 11 hours per day using media, according to Nielsen, the stakes for media companies and advertisers is high to insure that their messages are reaching the right audiences at the right time on the right platform through the right device. Nielsen has been diligently tracking consumer usage so as to offer their clients a more accurate look at how today’s consumers are navigating their ever growing media choices.

How will all of this impact the future of media? Katsingris offered his insights into the latest Nielsen Total Audience Report:

Charlene Weisler: How can half of the average American's day be filled with consuming media? Certainly there is a lot of multi-tasking but what about de-duped usage?

Peter Katsingris: Within the 11 hours per day of media usage there is some amount of simultaneous usage across devices.

Charlene Weisler: Where is the greatest growth coming from? How will this impact future usage?

Peter Katsingris: The greatest growth is among TV-Connected device use, whether it is the smart TV or other connected-devices that enable streaming content to the TV set. Streaming will continue to grow as the way people consume content through the TV glass evolves.  Additionally, digital device usage, particularly smartphones, is growing as consumers continue to personalize their media use. The options available to the consumer will result in a more “on-demand”, a la carte experience that consumers can access media anywhere and through whatever device is most convenient to them at that time. 

Charlene Weisler: TV looks to be consistently #1 in time usage. Do you see that continuing?

Peter Katsingris: It’s often said that TV is dying, but our data paints a different picture. People spend a lot of time in front of the TV set, whether it is Live, watching recorded content via their DVR or on-demand or even a subscription service through a TV connected device. Linear TV viewing continues to remain a substantial portion of the overall share of media usage.  But it varies by demographic.  Younger adults spend less time with linear than older adults and television accounts for a smaller percentage of that time.  However, they still watch television and will continue in one form or another.  

Charlene Weisler: Younger viewers are consuming less live TV. What are the long term implications?

Peter Katsingris: Younger generations have always been early adopters. With viewing content, early adoption means young people are engaging with platforms and devices that drive new habits, however, some of these new ways to connect still end up with a young consumer in front of a TV. 

Charlene Weisler: How much streaming is happening to the TV? 

Peter Katsingris: Consumers are incrementally spending more time on the television set streaming content. Overall, based on the Q1 2018 Nielsen Total Audience Report, half of adults 18+ are using TV connected devices (DVD/Blu-Ray, Game Console, Internet Connected Devices, Smart TV apps) to watch or use media content and that accounts for nearly 10 hours a week. Using Nielsen’s Streaming Meter we have a more complete understanding of streaming that’s occurring to the TV set. What we see is that among homes that have that ability, one out of every 10 minutes for adults was streaming content to the television set. Younger consumers having a higher percent of streaming of overall total TV usage.

Charlene Weisler: Which devices are consumers using to stream to the TV? 

Peter Katsingris: Two-thirds of homes have the ability to stream content via internet enabled TV connected devices like game consoles, smart TVs or internet connected device (i.e. Apple TV, Roku, Google Chromecast, Amazon Firestick). Teens are more likely to use game consoles to stream while older adults use a smart TV.  Across all TV households, about a third only use one device and another third use more than one device, indicating the multiple options consumers have. Typically homes with multiple device use have a combination of a video game console with another streaming device.

Charlene Weisler: What are the overall SVOD trends that this report uncovered? 

Peter Katsingris: The report focused on access to the three main Subscription Video On-Demand services of Netflix, Hulu and Amazon Prime Video.  More consumers have and continue to want access to these multiple channel(s) in their home compared to last year. Among total households, access to these services is up to 64% of television homes in March 2018, from 58% a year ago. Similar to devices that enable streaming in the home, people have access to multiple services with 37% of television households having access to 2 or more of the services. 

Charlene Weisler: How is SVOD impacting linear TV consumption? 

Peter Katsingris: It’s hard to look at SVOD in a vacuum because streaming encompasses a broad array of services, including SVOD, AVOD (Advertising supported VOD) and Virtual MVPDs like Sling TV and Hulu Live. An underappreciated impact of SVOD is that it exposes consumers to a different way of accessing content, via menus, as opposed to traditional channel surfing. This translates into adoption of products (e.g. VMVPD’s) that provide those improved interfaces and easy app-based access. We are seeing that with homes subscribing to those services. Also, SVOD provides extra channels to choose from and when there is more choice, it impacts behavior and impacts traditional linear services. Prior research has shown that once someone acquires a device capable of streaming content, there is a change traditional TV use. However, people will continue to watch the programs they like regardless of additional content services they subscribe to and use them to complement current behaviors.  

Charlene Weisler: How can linear TV companies use SVOD to inform their business strategy? 

Peter Katsingris: I’m not sure there is such a thing as a “linear TV” company any longer. Every one of our clients has a cross-platform strategy to reach their consumer, wherever that consumer is. Last year we launched Nielsen SVOD Content Ratings. This allows our clients-- studios, networks and others-- to see how their SVOD programming is performing as well as how this content may be impacting their linear businesses or even help with decisions around scheduling and licensing.

This article first appeared in www.MediaVillage.com