It is no surprise that connected television (CTV) and streaming video is all the rage. While cord cutting has been “a thing” with younger generations for a number of years now, it has become more of “the norm” with older generations as well. But with the rise in streaming usage comes the rise in streaming services making for a very crowded industry. With so many different options, consumers are finding themselves confused and uncertain as to which service is right for them. Agencies like mine need to be aware of all the streaming service options that are available, which advertising opportunities they offer, and which service options consumers are choosing for their “TV” needs.
Cable and satellite providers have experienced record subscriber cancellations over the past decade. With those cancelations came about many Multichannel Video Programming Distributor (vMVPD) TV services. Sling TV, Hulu Live TV, YouTube TV and DirecTV Now. These are just a few vMVPDs streaming TV services available that offer both live and on-demand TV. Promoted as a lower cost option from traditional cable, these services best resembled cable packages, where viewers could browse a tv guide and flip through channels of streaming programs 24 hours a day. But, with the boom of streaming content and the increase in OTT usage, vMVPD hasn’t seen the massive growth that was originally expected.
One of the biggest competitive options to vMVPDs is Subscription Video on Demand (SVOD) platforms. This is yet another alternative for viewers looking for even more content. Channels like Apple TV+, Disney+, Peacock and HBO Max have come into play in this streaming duel and are winning, big time. These ad-supported streaming services are home to a wide variety of content, from documentaries and full-length feature films to classic cinema favorites and original television programming. With all these choices, maybe vMVPDs never really stood a chance. Plus, vMVPDs rates continue to increase, turning more people off to their services. Some consumers have even started to revisit buying basic cable for their live tv viewing needs and layering SVODs to get the extra content they really want.
All these choices in “TV” watching can be confusing for many consumers and making the best decision on which services to choose can be challenging. This industry continues to innovate every day. The best way to continue learning about the advertising opportunities available is to stay informed. For a media agency owner, like myself, it’s important to keep track of which services consumers are choosing and the advertising opportunities that each may hold.
Understanding which streaming services offer Advertising-Supported Video on Demand (AVOD) opportunities is crucial. And for those that do, also understanding which audiences they are reaching. You must look at the rates they are charging and the true value they bring to an advertiser that is considering investing in them.
According to eMarketer, US connected tv ad spending totaled more than $8 billion in 2020, will increase to more than $11 billion in 2021 and reach more than $18 billion by 2024. That’s a lot of dough!
And for those companies that cannot buy direct on a national level, DSP providers like Jamloop, Simpli.fi, Fox and others are truly important. These providers are the portal to hundreds of stations, live sports, and publishers. They can help build a reach for a reginal or single market client. To ensure that an advertiser is getting real quality from their connected tv advertising campaigns, they need to work with an agency that understands all the factors for each content-type no matter what its acronym is.