SANTA MONICA, CA – The U.S. advertising market is showing signs of recovering from a pullback in media spending, but the marketplace is undergoing a secular shift as marketers shift television budgets into streaming.
“It’s a very soft marketplace, and there is an influx of inventory in streaming,” Kelly Metz, chief investment officer at Omnicom Group’s OMD USA, said in this interview with Beet.TV contributor Rob Williams at the Beet Retreat Santa Monica 2023. “There’s a lot of just organic growth amongst the streamers that introduced advertising, particularly Disney+ and others.”
Amazon Prime Video next year will expand the inventory of streaming marketplace with the introduction of an ad-supported tier. The video-on-demand platform is popular because it’s available as a standalone service or with Amazon Prime, the e-commerce giant’s paid-subscription service with an estimated 174.9 million members in the United States.
The audience for traditional linear television has declined steadily, though broadcast and cable networks are still capable of reaching a mass audience.
“If you’re looking at what you would reach with traditional television, you max out on any given quarter…at around 35 million households,” Metz said. “Still big, still hugely important, but the opportunity to really reach all of America now exists in other platforms and certainly in streaming platforms.”
OMD works to amass bigger audiences through a variety of ways, including its data collaborations with the streaming services offered by Disney, NBCUniversal, Paramount and Warners Bros. Discovery.
“That’s step one in terms of maximizing reach and making sure you’re really doing the right things across these streamers,” Metz said. “Certainly, we have that in play with Amazon….We’re excited to see that extended into Prime Video, because we think that’s going to be huge based on their published number of reaching 85 million households.”
Transparency Needed in Streaming
Looking ahead to next year’s upfront sales season, Metz said she expects to see more developments in the streaming landscape including improved transparency.
“There’s still a lot of work to be done in the streaming landscape on transparency, on knowing where we’re running and on understanding how we’re going to plan for that,” Metz said. “It’s context and audience, not just audience.”
The media context mustn’t only help to make audiences receptive to brand messaging, but it also must help to support the brand’s image.
“If our streaming partners aren’t embracing the context, they’re missing out,” Metz said. “We cannot be running in places we are unsure of. And traditional television has always offered that safety. Streaming needs to do the same.”
Buyer’s Market for TV Ads Comes With Shift to Streaming: Omnicom’s Kelly Metz
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