When BARB admitted that “in a world of fragmentation, traditional TV viewing is declining” you knew the waters have been breached.
The UK TV ratings body made the comment in a January report into SVOD viewing that concludes, “Far from being niche, SVOD services are now an established part of the television ecosystem.”
Yet the report begins, “Television is still king.”
Both statements are true and speak to the dilemma facing the marketers of content and advertisers, as they seek the optimum return on production budgets and ad investment.
Digital viewing rises
Driven by the rise in popularity of people watching online video, advertisers spent a record £699 million on video ads in the UK in the first half of 2017 – a 46% year-on-year rise, according to the most up to date Internet Advertising Bureau UK / PwC Digital Adspend report.
The time people spend watching short video clips appears to have almost trebled over the past three years (Sept 2014 to Sept 2017): from 51 minutes to 2 hrs 21 minutes per week, according to YouGov data.
“The time people spend watching online video has grown tremendously over the last few years,” says IAB CEO Jon Mew. “It’s little wonder that video is now the fastest-growing ad format as advertisers look to tap into the changing way people consume content.”
On the other hand, UK commercial broadcaster lobby group Thinkbox fields statistics showing that TV accounts for 93.8% of video ad viewing with the average person in the UK watching more than 20 minutes of commercials a day. Broadcast’s reach is strong across Europe too. Thinkbox’s survey suggests that in Spain, the average time spent watching on a TV set has increased to 3h 51 minutes; and that millennial TV viewing actually increases as they get older and have kids.
“Over the past decade, TV has proven remarkably resilient in an era of immense disruption,” asserts Matt Hill, Thinkbox Research and Planning Director. “Despite the emergence of SVOD services and online video platforms, TV consumption has remained steadfast around the globe.”
But back to BARB. What is more telling about its arguably belated recognition of the importance and permanence of digital is that one of the world’s most trusted ratings services still has no cross-platform measurement in place.
Media agencies and TV marketers worldwide have been calling for a resolution to this issue for years.
In 2015, the average person watched 216 minutes daily of traditional consolidated TV (live and viewed within seven days of broadcast), according to BARB. In 2016, this fell to 212 minutes, a 2% decrease, although the total amount of time spent in front of the TV is unchanged. The reason for this apparent disconnect, reckons BARB, is that a fast-growing area of activity is “unmatched” viewing, a figure that has reached almost 19% in recent months. It puts most of this down to people watching programming via SVOD.
Cross platform conundrum
BARB’s Dovetail Fusion reports are to be published regularly from March (compiled by Kantar Media) and will deliver the agency’s first cross-platform measurement using digital view data from the likes of Sky and the BBC.
Yet BARB isn’t able to measure actual viewing to SVOD services without the cooperation of service providers like Netflix and Amazon Video.
The clamour for a trusted and accountable multiple-screen audience currency is necessary to unlock further spend against video online and to shore up the value of ads placed against live/linear schedules.
A September 2017 study by IAB Europe found that 90% of European industry stakeholders believe brands would spend more on digital channels if cross-media measurement capabilities were improved.
“The gap between advertising models for linear TV and digital video is closing, and the industry is moving towards integration. The greatest challenge remains measurement.” – Thomas Bremond, GM, International, Advanced Advertising, FreeWheel
“The gap between advertising models for linear TV and digital video is closing, and the industry is moving towards integration,” says Thomas Bremond, GM, International, Advanced Advertising, FreeWheel. “The greatest challenge remains measurement.”
In the absence of an accepted metric to combine TV and digital a number of stakeholders have developed their own systems.
In the US, Google has made its traditional TV inventory available via DoubleClick, allowing advertisers to buy linear TV spots programmatically. “We’re in the golden age of video, and while this explosion of great content is great for users, it creates a lot of complexity for advertisers and publishers,” blogged Rany Ng, director, product management, Google, about the announcement.
Thinkbox offers IPA TouchPoints, a planning tool aggregating data from a 5,000-strong media diary and questionnaire intended as a stop gap before Dovetail launches.
IAB Europe is working on a cross-industry European Viewability Initiative which aims to improve the accuracy and consistency of measuring the viewability of delivered impressions. It thinks this will help make digital advertising more directly comparable with TV.
And just this month [February 2018] Discovery introduced ‘Total TV’ an approach for audience measurement during live events kicking off with Eurosport’s coverage of the recent Winter Olympics in South Korea. It includes engagement with content across all Discovery’s digital and social media properties.
“It neatly meshes data from different sources,” explained Chris Jones, Global Lead, Research & Evaluation at Publicis Media Sports & Entertainment, which helped implement the system. “Importantly, official audited data from television and online measurement systems are at the heart of the calculation. But clever use of survey research allows us to understand the cross-over in people who connect with the Games via both TV and digital/social platforms, meaning we can remove any double counting and determine the true pan-European audience reach of an event for the first time.”
Brand safe environment
A need for a cross-platform measure does not exist in isolation of another top priority for marketers, that of brand safety. Given the issues that befell YouTube and other unmoderated user-generated platforms in 2016, when ads were placed alongside brand inappropriate content (WPP-owned GroupM downgrading its expectations of internet advertising growth as a result), efforts are being made to give online advertising the safety net of a managed environment.
“It is now more critical than ever to reinforce the quality of the digital advertising environment to ensure that advertisers have strong confidence, and underpin the delivery of free content,” says Townsend Feehan, CEO, IAB Europe. “Ensuring that viewable impressions are measured correctly and consistently across all markets in Europe is a key first step.”
Tim Sewell, CEO at digital video distribution company Yospace, says: “Improved standards certainly need to be agreed in the OTT space, but this plays to the broadcasters’ strengths and the reasons for their enthusiasm are clear: delivering a true premium quality of service is their ace card – not just in terms of viewer experience, but for advertisers too. It’s the key differentiator between broadcasters and the likes of Facebook and YouTube, where three seconds is enough to count as an ad view.”
While brand safety and accountability issues are a wake-up call for digital, the march of ad spend onto Google and increasingly Facebook means traditional media needs to respond.
They are doing in this in several ways. Later this year four of Europe’s largest commercial broadcasters will launch a European video-on-demand exchange to cater for the growing demand for multi-territory video campaigns.
Traditional media fights back
European Broadcaster Exchange (EBX) is a joint venture between Germany’s ProSiebenSat.1, Italy’s Mediaset, France’s TF1 Group and Channel 4 in the UK. It claims to reach 160 million viewers a month across all member VOD platforms.
“Many international companies have a strong demand for high-quality and brand-safe advertising environments in the video sector,” explained ProSiebenSat.1 COO, Christof Wahl at launch. “EBX will offer them the opportunity to book pan-European campaigns in an economic area with a population of more than 250 million in an automated manner. This will allow us to gain access to additional ad budgets that we were previously unable to address on a national level.”
Pay TV operator Sky, which of course relies more heavily on subscriptions, is also feeling the pinch from the GAFA (Google, Amazon, Facebook and Apple). Its trump card Sky AdSmart has been in play since early 2014 and enables advertisers to target households based on factors such as age, location and life stage from a combination of Sky’s own customer data as well as info from consumer profile experts like Experian. This means that smaller advertisers can cut their cloth however they want and only reach (and pay for) highly specific households.
According to Sky the addressable service delivers a 75% return rate with channel-switching during a targeted advert reduced by 48%. Virgin Media recently integrated AdSmart into its STBs gave the two companies access to 30 million viewers in the UK and Ireland and more scale to compete with social media networks.
Elsewhere, Liberty Global is going on the offensive against tech giants Google and Facebook with an aggressive pitch to advertisers of the veracity and scale of data harvested from its own platforms.
“There are lots of fears about how big the threat GAFA has become and how regulation doesn’t seem to apply to them but they don’t have the rich data about how customers behave which we do,” Laurence Miall-d’Aout, VP, Data and Advanced Advertising, Liberty Global told Cable Congress. “That is our data and it is up to us – and the cable industry as a whole – to harness this data better.”
The cable giant is developing Liberty Insights, presented as a single platform encompassing aggregated consumer data from its 24 million customers, accessed over 14 million devices and uniting 15 billion viewing hours combining customer and viewing data with third-party data.
It will use Machine Learning to offer insights on advertising and programming to broadcasters within its stable on a local and macro level.
For commercial broadcasters the need to address targeted ads is more pressing. STV and Channel 4 have been most proactive with the latter beginning 2018 offering personalised advertising via All 4 across every channel, including mobile, tablet, games consoles and smart TVs. In recent figures the broadcaster reported more than 60 million monthly viewers to All 4 with digital revenues soaring 24% year on year to £102 million. A targeted ad service is overdue from ITV but this can be expected later this year.
Both STV and C4 oblige viewers to register their consent. That’s important since broadcasters will need to meet strict privacy rules before the EU’s General Data Protection Regulation come into force in May.
The effectiveness of increasingly granular targeting goes hand in hand with technologies to automate the process of insertion in individual streams. According to IAB Europe/IHS Markit, more than half (50.1%) of European display ad revenue is now traded programmatically.
“Programmatic needs rules and should be about automation – not simply be automatic,” advises Bremond. “Publishers should focus on premium video content, where there is a direct relationship between the buyer and seller, and transactions should take place in a saleable, brand safe environment.”
Mobile and social strategies
Mobile continues to be a major growth driver of programmatic. With mobile advertising projected to reach nearly US$128 billion globally in 2018 (according to Zenith Media) and video set to account for three quarters of all mobile traffic by 2020 (per Cisco) content publishers must also look to tailor strategies around mobile.
It is in this context that Viacom, Turner, NBCU and Discovery separately partner with Snap Inc to create original content for Snapchat's Discover section. In Viacom’s case the agreement also grants Viacom the right to sell Snapchat’s US-owned ad inventory. Discovery’s pact will see bespoke user-generated content from the Winter Games published to Snapchat users across Europe. Engagement figures from this will be included in Discovery’s Total TV metric. Buzzfeed is creating NBCU’s bespoke content from South Korea in a tie-up which The Wall Street Journal estimates will net US$75m in new ad revenue.
Join opinion formers and leading stakeholders at TV Connect Congress to debate the issue. Social media: The not so small disruptor (Wednesday, 9 May 2018 12:20 - 12:40); Quality vs Quantity: how far will the shift go for advertising? (Wednesday, 9 May 2018 16:40 - 17:00).