This year’s upfront sales season will include a stronger presence from streaming platforms that carry advertising and whose audiences have grown substantially in the past year. Those ad-based video-on-demand (AVOD) services present challenges and opportunities for marketers that aim to reach consumers who are more averse to traditional commercials.
“We’re in a hypergrowth stage in terms of the transition that consumers are having to streaming,” Adam Gerber, global chief media officer at Essence, a unit of WPP’s GroupM, said in this interview with Beet.TV. “We’re seeing acceptance of the ad-supported model, which is promising, but we’re still in the infancy in terms of understanding how best to leverage the opportunity from a marketing perspective as the TV marketplace changes so quickly.
Gerber, whose background includes work on the sell-side of the media industry, including more than six years at Disney ABC Television Group, said he’s not surprised by programmers’ different strategies to reach consumers.
“It’s clear that consumers have been enabled by technology, and access to watch on their own time. They want things on demand, and they want aggregated offerings of large swathes of content. The move to streaming services was something that was going to have to happen.”
Shift in Consumer Expectations
He predicted that most scripted content will be on-demand through streaming platforms, while live linear TV will continued to different itself with sports and news. The popularity of streaming platforms that don’t carry advertising, such as Netflix and Disney+, is worrisome for marketers that seek to reach those audience, he said.
Source: eMarketer, Insider Intelligence
“There’s no question that the streaming services are cannibalizing the ad-supported environment,” he said. “That’s a problem for marketers, but it’s not unexpected. As an industry, we’ve not kept up with consumers in terms of the advertising experience they expect.”
Gerber would like to see media outlets work on improving that experience, and not be limited to traditional ways of grouping ads into commercial breaks. He’d like to see more advertising that’s less intrusive to viewers who have greater control over what they watch.
“There are a tremendous number of ways that we can reimagine and re-explore innovation on the ad format front in an AVOD environment,” he said. “I’m continuously shocked we’ve maintained a pod and multi-ad position model, and assumed that that’s how we need to move forward.”
Gerber anticipates that the upfront season will mark a significant change in ad inventories, including those of AVOD services.
“The supply that has existed historically is not going to continue to exist in the same ways and in the same environments that it has,” he said. “There is a very swift shift to streaming. We have to re-think our models. We have to ask our sell-side partners to shift their business models to enable buy-side decisioning to become a reality at scale.”
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