Viewers are now watching more Over The Top (OTT) content than ever before. So, what might be instal for 2023? Alex Spurzem (lead image), general manager of Samsung Ads Australia & NZ says that streaming will continue to play a significant role in how audiences spend their time. However, ad-funded models will pick up the pace as inflationary pressures rise and streaming giants embrace hybrid tiers…
According to PwC’s annual Global Entertainment & Media Outlook, the US streaming services market is expected to slow down over the next five years with consumers becoming pickier about streaming subscriptions and economic concerns playing into personal spending habits.
That trend is also being observed here in Australia. Figures from Kantar revealed that between July and September 2022, 6.15 million Australian households subscribed to at least one video streaming service. However, as the rising cost of living hit home in the third quarter of this past year, 1 million subscriptions were dropped, following more than half a million subscriptions being cancelled in Q2, with 24% claiming they’ll cancel a subscription within the next three months.
It’s clear that the appetite for new or new to you, premium content is higher than ever. Just look at the success of Netflix’s Wednesday which premiered last November and pipped Stranger Things to the post as the new record holder for the most hours viewed in a week for an English-language TV series on Netflix. However, as budgets tighten, we believe consumers are more open to alternative models for a streamed viewing experience. We’re seeing this play out on Samsung Smart TVs across Australia, evidenced by our recent 2022 Behind the Screens Streaming report. While the overall time spent in streaming environment was on the rise, time spent with ad-supported video on demand (AVOD) was the fastest growing category of streamed TV on Samsung Smart TVs.
An opportunity to repackage the streaming experience
The rise of AVOD creates an opportunity for advertisers and publishers alike. Much attention has been paid to the introduction of hybrid models by SVOD streaming giants Netflix and Disney+. This is of particular note for the former which resisted the idea of advertising on its platform. Under hybrid models, they could potentially reach a broader audience at a lower price point, while extending the shelf life of original content, which viewers tend to watch in short bursts straight after release. Viewers therefore are being offered more choice, and are increasingly opting for ads in return for content.
In fact, Samsung Ads’ recent TV advertising engagement study found that three in five Aussies surveyed would watch ads if the content is free. Australian surveyed also reported that they engage best with ads delivered to them on ad-supported streaming services, compared to other platform types like linear TV or paid subscription services. Those findings signal a growing opportunity for advertisers, publishers, and content creators to repackage the streaming experience.
It’s clear that the battle for viewers and good content to reach and engage them will continue heating up. Last years Upfronts season proved that the networks were looking at new ways to drive advertising effectiveness, with interactive shoppable ads on CTV and enhanced targeting capabilities in BVOD environments.
FAST is fast-growing
The story for 2023 doesn’t stop with AVOD. Already hugely popular in the US and gaining traction in Europe, the latest innovation delivered to our screens is FAST: free, ad-supported streamed TV. FAST combines some of the traditional features of linear TV – scheduled programming – with on-demand content.
It was “the hot topic” of MIPCOM, the world’s largest TV market in Cannes. There are now more than 1,400 FAST channels in the US, thanks to the huge consumer appetite for free content streamed straight to their TVs. In Australia this is still nascent – Sasmung TV Plus is one of the pioneers of this service here, alongside Fetch. More recently in early December last year Paramount announced 13 new FAST channels coming to Ten Play in 2023. FAST allows for addressable and relevant ads to be delivered in a premium, brand safe environment on the biggest screen in the house.
Another key advantage to FAST is the return of the passive, ‘lean-back’ experience for TV – no more long arguments about which series to watch. Given that 49% of people surveyed have said that they have taken so long to decide what to watch that they have ended up watching nothing at all, the appeal of FAST is obvious. It offers a simple journey of content discovery and if viewers already have a CTV or streaming device, then they can watch FAST platforms as well. And so far, audiences are responding – Samsung TV Plus Australia, Samsung’s own FAST service, has grown viewing time by 128% between 2021 and 2022.
Focus on measurability
TV measurement has always been a difficult issue to tackle with neither legacy or emerging systems being able to provide the silver unified bullet. Whilst the need for stronger measurement capabilities is key, pre-planning and insights around where eyeballs are going and how they are viewing will help drive outcomes.
Our automatic content recognition (ACR) provides first-party, deterministic insights that complement modelled TV data by giving the total TV picture. This unique capability will be key in helping advertisers navigate the complex waters of changing viewer behaviours.
As fears of a recession mount, brands who take the long term view and invest could reap the benefits. Addressable TV has the ability to capture the attention of consumers on the biggest screen of the house, and measure full funnel outcomes. Brands will not only benefit from short term sales, but potential long term growth and everything in between.
The rise of AVOD and the entry of new ad-funded tiers from major SVOD players will continue to create even more prospects for Australian brands to engage with their audiences. A stronger TV and video ecosystem benefits everyone from advertisers, platforms and audiences alike. As an industry, we have never had more opportunities and tools to connect.
