Are advertisers changing their minds about ad-supported streaming? | Advertising

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As consumer habits change and evolve, advertisers who have traditionally invested in television understand that reaching the same audience today as three years ago is nearly impossible. As a result, they are rethinking their dissemination strategy.

According to research from GroupM’s Consumer Eye report, TV ads still rank first in the region as a medium that gives a positive opinion of brands, but agencies are helping advertisers move to over-the-top platforms. (OTT).

This transition is occurring as OTT services increase and TV undergoes an addressable transformation, and more opportunities become available to advertisers. Platforms like Netflix announced they would open an ad-supported tier, while Disney+ and YouTube also launched expanded advertising options.

Advertisers are using a variety of strategies to benefit from the data accuracy and power that a large screen offers. For example, in April 2022, Grab and Viu Indonesia became one of the first companies in Southeast Asia to launch a brand-funded long-form entertainment series.

Indonesia has been one of the countries hardest hit by the pandemic in Southeast Asia, and in the face of calamity and hardship, this partnership has featured stories of everyday heroes whose spirit of resilience has helped them to overcome the worst. Title Cerita Tentang Percaya or “Stories of Belief,” the six-part series was a collaborative effort of marketing and advertising consultancy The Academy Consulting (TAC), Iron Hill Media (IHM) and Passion Pictures. Each of the 22-minute episodes airing on Viu focused on a different story of survival during the pandemic.

Anwesh Bose

“Every brand today talks about [how it wants] do something distinct, different and disruptive, but meaningful,” said Anwesh Bose, Founder of The Academy Consulting and former Managing Director of Havas Indonesia. Asia-Pacific Campaign. “Viu and Grab wanted to do this because no brand in Indonesia, and at least in Southeast Asia, has done branded entertainment on this scale. We use consumer stories to form this branded entertainment where both parties own 100% of the intellectual property of the content. Viu used a fair amount of inventory to promote the series, and the campaign was organically driven by the platform.”

Alexandra Lowes, vice president of customer engagement and growth, APAC, at Finecast, observes that other advertisers are adding OTT to traditional linear plans to help increase reach. They also use data to create specific audiences and location-based campaigns to improve the relevance of messages in an area or increase footfall.

She notes that in all markets, Finecast is also seeing customers who have never considered television before. Consider brand building strategies, as OTT can provide greater business flexibility and speed to market compared to planning and buying traditional TVs.

“Growth in OTT viewership is driving creative innovation, and customers who want to be part of TV’s transformation journey can now consider formats not traditionally seen on TV. Buyable ads and creative opportunities dynamics can now be the ingredients of an OTT campaign, forming an omnichannel creative strategy,” she says. Asia-Pacific Campaign.

The growth of ad-supported streaming

In a price-sensitive region like SEA, most of the OTT services that have done well so far offer subscription and ad-supported options. For these services, it underscores the fact that consumers here are generally price-conscious and want more choice with that in mind.

The ad-supported audience is growing in the region. There are 116 million viewers in SEA who have embraced ad-supported content, according to The Trade Desk’s recent Future of TV report.

An overwhelming majority of these viewers are ad tolerant, with nine in 10 (89%) willing to watch two or more ads in exchange for one hour of free content.

Mitch Waters

Mitch Waters, senior vice president of SEA, India and ANZ at The Trade Desk, says it’s also worth noting that moves such as Netflix and Disney+ are inspiring brands to compete for limited consumer attention. He explains that the fact that Netflix and Disney+ are moving towards an ad-supported model proves that OTT has established itself as a credible channel.

“I anticipate more brands will be keen to learn how they can reach their audiences by running campaigns on these and other ad-supported platforms, including regional players such as iQiyi, Viu and WeTV,” Waters said. Asia-Pacific Campaign. “It is important to note that with more ad-supported services, we will see a shift over the next five years: brands will first spend on premium content platforms instead of user-generated content platforms. of YouTube and social media.”

Alexandra Lowe

Agreeing with Waters, Lowes adds that ad-supported acceptance varies across regional markets, as consumers have different preferences regarding media access and absorption of advertising content.

For example, Malaysians, Filipinos and Thais prefer free access to services with ads, but Indonesians would opt for paid on-demand services without ads.

“Ad-supported streaming services are taking viewers back to how they watched TV 15 years ago, but with more advanced advertising capabilities. Ultimately, this should be a better advertising experience for consumers, like having the choice to watch content on their favorite streaming services with relevant ads,” she explains.

A personalized viewing experience

To create a personalized experience for every consumer, OTT service providers need to understand how, what, where and why their viewers watch given content. Understanding viewer habits requires detailed analysis of data spread across multiple platforms, enabling advertisers to work with online video service platforms with the intelligence to gather the critical information needed.

For instance, Korean content remains popular in SEA, especially in a market like Indonesia, where more than a third of people say they watch it very often. This means that a one-to-one approach that provides viewers with the right types of content and advertising to suit their preferences is key to retaining them on the OTT platform.

Lowes explains that understanding the location and viewing habits of a target audience will allow advertisers to create messages that are aimed directly at them. For example, research from Finecast and Amplified Intelligence in the UK shows that viewers pay 20% more active attention per second to OTT ads than to linear ads.

The platform has the most significant impact on ad attention. This impact means that while OTT and UGC will drive higher levels of brand recall, OTT will most likely outperform UGC if metrics such as attention are used to measure success.

“Consumers choose OTT because of quality, control and variety; we find that consumers view brands more favorably within broadcast-quality content services compared to video-sharing platforms,” says Lowes.

“Creative innovation is starting to flourish again in the TV industry. The SEA region is about to see more ways for audiences to interact with brands in a premium TV environment. “buyable ads or dynamic creative ads that allow consumers to have tailored offers. The bridge between TV and digital enables more impactful campaigns that allow consumers to interact with brands in a more seamless way than what we have seen over the past five years.”

There is also a correlation between the growth of OTT platforms and investment in content, according to Lowes. For example, the top three commissioners in the region are iQiyi, Tencent, and Zee Entertainment—according to Ampere Analysis research— demonstrating that regional players take content development very seriously.

iQiyi, for example, spent US$3.13 billion on content in 2018, which nearly matches the total content spend of China’s six major broadcaster groups. It produced over 250 original content that year, with exclusive content accounting for 10% of its total catalog.

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