The Feed

Global Ad Trends: AVOD luring brands and viewers from linear TV

Advertising spend on broadcast TV (excluding political ads) fell by $34 billion in 2020, as pandemic-induced restrictions halted TV productions and brands turned to streaming with the AVOD market set to double by 2025 to $54 billion, per WARC’s Global Advertising Trends: Next Generation TV.

Why it matters

Broadcast’s loss was mostly AVOD’s (ad-funded video on demand) gain, as brand investment in streaming platforms grew by 9.9% to $26.7 billion. Over the next five years, that investment in the US market – the world’s largest – is set to treble to $24.2 billion.

Commenting on the results, James McDonald, Head of Data Content, WARC, noted that next gen TV is “demonstrating the core traits of offering mass reach for resonant creative in brand safe environments. However, unlike with its ancestor, fraud now poses a very real and present threat to advertising trade, especially among unverified vendors.”

The details

• Investment follows consumers. Over a quarter of US (26%) and UK (27%) viewers are streaming more video at the expense of linear TV. A full third of Americans exclusively stream their video content.
• 2020 was a watershed moment for video streaming. 40% of consumers around the world now have an internet-connected TV, either smart TVs or through a device or console.
• Linear TV is receding, but the TV screen remains king. The biggest screen in the house accounted for 75% of all streamed video time in Q4 2020 across CTVs (49%), smart TVs (17%) and games consoles (9%).
• Mobile matters everywhere, but it’s king in Asia, developing markets. While globally, mobile accounted for the same proportion of streaming time as desktop at 10%, live TV is a different story. YouGov finds that one in three globally watches live TV on their mobile, tablet or PC, but this rises to over one in two in India (57%) and China (54%).

Reach and ad quality are key short-term drivers of ROI

Reach and ad quality are the most important short-term drivers of return on investment (ROI), according to research from Nielsen.

Why it matters

The most significant short-term factors for driving ROI vary across categories – ad quality ranks highly for most but is of less importance for food and personal hygiene & health advertisers.

Improving on the factors most relevant to their category can help advertisers double their ROI, from an average of $1.06 to $2.09. WARC's own analysis of the most successful brands shows that the median ROI can rise even further, up to $3.99.

Takeaways

• Reach achieves an average rank of 1.8 (between 1 as the most significant driver and 9 as the least significant) while ad quality follows at 2.4.
• The WARC Awards for Effectiveness is a new global competition showing how marketing delivers business results – entries are now open.

Sourced from Nielsen, WARC Data

Tata Motors shifts to a post-COVID media mix

Keeping auto brands in the minds of consumers has been a challenge for India’s Tata Motors during this past year and the lessons the brand has learned will inform future strategy, according to the head of marketing in the passenger cars division. 

What COVID-19 has changed 

• Consumers are thinking more about vehicle safety features then they did before.
• A digital path is replacing the traditional showroom visit. 
• People weren’t using cars as much during the pandemic but now they see them as a safer way to commute.

It’s about screens now 

“We’ll be focused more on digital, in terms of media and experiential marketing,” Vivek Srivatsa told Afaqs! “Social media and online reputation management becomes more important. Being seen on a screen – whether it’s a mobile phone or a TV or a laptop, becomes important.”

Final thought

“OOH will remain important. With lesser travel, OOH becomes more important because when you go out, you tend to notice these things more. It doesn’t become a blind spot” – Vivek Srivatsa, head of marketing/passenger cars, Tata Motors.

Sourced from Afaqs!

L’Oréal sees ‘no limit’ to growth in China

Cosmetics giant L’Oréal’s next CEO predicts a post-pandemic boost for the beauty industry, citing what is happening in the China market now as proof that a “fiesta of makeup and fragrance” is coming.

During a recent earnings call, Nicolas Hieronimus, who takes over as boss in May, set out the group’s strength in China, where it has seen double-digit growth and where all of its categories have returned to normal.

The details

• The Chinese love of beauty will continue to drive the market, the company says, with rising demand from Chinese men as well as women. China’s consumers love strong brands and understand quality.
• E-commerce will be a key focus for the brand in China, where 50% of sales in the sector are already online.
• Skincare will continue to be the number-one growth driver in China, partly due to the country’s ageing demographic. The sun-care category also has huge potential.

Soundbite

“The market has still many years of growth ahead. The spending per capita of Chinese consumers is still quite low compared to that of the USA. So, there is no limit to the growth potential of China”– Nicolas Hieronimus, Deputy CEO at L’Oréal.

Sourced from Seeking Alpha

Brits go streaming as digital media consumption grows

During the pandemic, Britons watched more live and on-demand TV but average weekly viewership fell as streaming viewership rose sharply, according to a new report. 

YouGov’s ‘International media consumption report 2021: Is there a new normal?’ is based on more than 18,000 interviews across 17 global markets and explores traditional media, digital media, advertising, subscriptions and the impact of COVID-19. 

Key GB points 

• COVID-19 increased average weekly viewers for streaming (+8%) while live TV (-2%) and on-demand decreased (-4%).
• The proportion of Britons who listen to podcasts increased to a third in 2020 (33%), with comedy the most popular genre (16%).
• Commercial radio listenership declined from 59% to 55% as fewer people commuted and more worked from home. 
• Print magazine consumption saw significant decline between 2019 and 2020 (41% to 26%), print news readership fell 9%.
• Popularity for mobile/tablet news apps grew by 4% to rival print as a preferred news source (29% compared to 34%).

Final thought 

“COVID-19 has significantly impacted consumer behaviour and, in turn, media consumption habits globally. Change has been unpredictable. Reliable, up-to-date insight can provide an early window into behaviour change to inform effective media planning and campaign development” – Jules Newby, Sector Head of Media at YouGov.

Sourced from YouGov

One in five viewers streams at the expense of linear TV

One in five internet users say they don't watch traditional TV content but do stream TV, according to data across six European markets and the United States from AudienceProject.

Why it matters

More consumers are using streaming services like Netflix and this data suggest some audiences are moving away from traditional TV, rather than watching both.

Consumers are also more interested in the content than the specific platform or device they actually watch it on. Internet-connected TVs and video-on-demand services offer more choice so have proven attractive to audiences.

Takeaways

• One-third of internet users in the United States say they don't watch traditional TV content but do stream TV, the highest share across all seven markets surveyed.
• Advertisers have responded – linear TV spend has fallen $47.1bn over the last five years while online video spend has grown $38.7bn.

Sourced from WARC Data's Global Advertising Trends: Next Generation TV. WARC Data subscribers can access the full report here. A free sample report is available to non-subscribers here.

'Shoppertainment - the next big e-commerce opportunity in Europe?

European consumers are more than ready to embrace the new online shopping formats, such as livestreaming and ‘shoppertainment’, that are so huge in China, a new study claims.

A report from AliExpress, the global online marketplace owned by China’s Alibaba Group, examines the development of the concept in Europe. Its conclusion: shoppertainment, which attracts consumers with interactive events such as livestreaming and games, will be the continent’s next e-commerce frontier.

What the study finds

• Consumers are ready to experiment with new ways of online shopping as a result of the COVID-19 pandemic. Two thirds of consumers from France, Poland, Spain and the UK say they’re shopping more online, and 70% said they’re specifically interested in the idea of shoppertainment.
• Consumers are most drawn to channels when electronics, fashion, and cosmetics are on offer and they’re most engaged when sellers conduct livestreaming events that feature short content that’s trustworthy, relatable, informative and hosted by someone they like.
• A category of ‘online always’ consumers (19% of those surveyed) is most likely to buy spontaneously when they see products offered by influencers they like. They also spend the most time on livestreaming commerce, averaging 23 minutes at a time.
  

Top takeaway

Europeans want different things, the study found: UK consumers want mobile-friendly content that’s trustworthy and entertaining, while French consumers prefer content that’s succinct and endorsed by influencers. Shoppers in Spain look for the best deal, along with practical information, and consumers in Poland value interactions with hosts and other customers the most.

Sourced from AliExpress

Apple boss reaches out to young Chinese consumers

A young Chinese influencer’s virtual talk show with Apple CEO Tim Cook has gone viral in China, reaching hundreds of millions of young consumers either directly or via related posts on Weibo.

Why it matters

Several international brands have been criticised in recent years for campaigns that misread local sentiment. Cook’s charm-filled approach via a social media influencer suggests a new way for Western brands to communicate directly to consumers in China.

The 18-minute video interview on Bilibili between 60-year-old Cook and 22-year-old student He Shijie appears to have had a largely positive response from young Chinese consumers, based on their reactions on social media, according to the South China Morning Post.

The details

• Cook spoke of his admiration for China’s tech advances, the Chinese people, their history and culture, and praised Chinese consumers’ feedback on Apple products, which had enabled “a tonne” of improvements.

• The chat, conducted in English with Chinese subtitles, steered away from any sensitive topics such as censorship, or the security controversy in the US and elsewhere surrounding Chinese tech companies.

• Apple was hit by the China-US trade war under Donald Trump, but in Q4 2020 it registered 57% growth in Greater China.

Soundbite

“Apple is using this peaceful moment not only for marketing, but also using Chinese social media to connect with consumers of Apple products” – Cameron Johnson, New York University Shanghai and partner at Tidal Wave Solutions consultancy.

Sourced from South China Morning Post

Spot volume down by a tenth as coronavirus hit

When the coronavirus outbreak took hold in Australia last year, TV CPMs fell markedly as many brands froze budgets. However, some categories bucked the wider trend and increased their spot volume, according to a WARC Data analysis of Adgile data.

Key trend

The number of TV spots measured in April 2020 (1.23m) were the lowest level recorded and had fallen by one-tenth (11.2%) compared to the start of the year.

However, the spot volume for health & beauty brands rose 47.2% between the pre-COVID period (Sept 2019 to Feb 2020) and the outbreak (Mar 2020 to Sept 2020). Finance and food brands also increased volumes by over a third during this period.

Additional findings

• TV campaigns ran for longer as production was curbed – FMCG campaigns are now over a week longer.
• Retailers, usually value-led, pivoted to brand-building during the coronavirus outbreak.

Sourced from WARC Data's Global Advertising Trends: Next Generation TV. WARC Data subscribers can access the full report here. A free sample report is available to non-subscribers here.

Australia’s OOH industry reports 39% drop in 2020 revenue

Australia’s out of home (OOH) industry saw a total decrease of 39.4% on net media revenue in 2020, down to A$566.5 million, from A$935.5 million for 2019.

According to the Outdoor Media Association (OMA), which represents approximately 80% of the OOH industry, the COVID-19 lockdowns across the country along with economic conditions have been cited as the main factors contributing to the significant reduction for the industry.

Within the total, the share of Digital Out of Home (DOOH) edged up to account for 56.1% of total net media revenue, a slight increase on the 55.8% recorded last year.

OOH category breakdown (2020 vs 2019)

• Roadside billboards (over and under 25 square metres) - A$272.2 million vs. A$369.4million
• Roadside other (street furniture, bus/tram externals, small format) - A$153.2 million vs. A$266.5 million
• Transport (including airports) - A$62.4 million vs. A$169.4 million
• Retail, lifestyle and other - A$78.7 million vs. A$130.2 million

Spotify amplifies its podcast offer

Spotify will make it easier for advertisers to buy ads across all its inventory, including music and podcasts, at the same time as it is to start testing paid podcast subscriptions that will likely exclude ads.

Context 

In its recent Q4 earnings call, Spotify said it had tripled the number of podcasts on its own platform in the past year to 2.2 million and that a quarter of its 345 million monthly active users were podcast listeners. It added that having podcasts helps user growth and retention and is a positive contributor to LTV per subscriber. 

Let’s deal with the ads 

The Spotify Audience Network aims to give advertisers the ability to reach and target digital audio audiences at scale both on and off Spotify (via recent acquisitions such as Megaphone).

What about the subscription angle? 

US creators will be able to use a new feature in Spotify’s Anchor podcast creation tool to publish paid podcast content aimed at their “most dedicated fans”. This could include ad-free content as well as bonus material.

Anything else?  

Spotify is trialling video podcasts, and a new WordPress partnership will make it easier for bloggers to turn their posts into podcasts. Interactive features like polls and Q&As are also being tested, which, TechCrunch noted, offer audience participation but without the potential downsides of new audio-based app Clubhouse. And the platform is expanding into more than 80 new markets. 

Sourced from Seeking Alpha, Axios, TechCrunch

Star India plans to build on 2020 IPL success

Star India is reported to be planning significant increases in ad rates for the next edition of the India Premier League, buoyed by the success of IPL 2020. 

Context 

• Despite the 2020 tournament taking place six months later than planned and outside India, the Disney-owned official broadcaster reported a 23% increase in viewership on IPL 2019 and a total of 400 million viewing minutes.
• The Broadcast Audience Research Council (BARC) India reported an increase of 15% in ad volume in the first week of the competition.
• Media planning sources tell Exchange4Media that ad rates could increase between 25% and 30% for IPL 2021, currently scheduled to start April 11.
• Video streaming platform Hotstar is also projecting a 50-60% increase in watch time for IPL 2021, partly driven by new Watch Parties. 

A cautionary note

The 30% figure is based on talks between Star and agencies – “the official conversation is yet to begin with the clients”, says one media planner.

Sourced from Exchange4Media

Myanmar’s digital economy has been ‘thrown off a cliff’

Draconian laws introduced by the new junta running Myanmar are threatening to derail a decade of economic progress and unprecedented levels of foreign investment, business groups warn.

What’s happened?

• The coup blocked social media platforms, including Facebook, and shut down mobile networks.
• Planned cybersecurity laws would give the junta wide-ranging controls over online content. One owner of a service provider said the country’s digital economy, which received a huge boost as a result of the pandemic, had been “thrown off a cliff”.

What are businesses doing?

• Many are reviewing their activities in the country, fearful of the reputational damage of being associated with a regime that ousted an elected government.
• Nikkei Asia lists Japanese brewer Kirin Holdings pulling out of a joint venture, Singaporean tycoon Lim Kaling withdrawing from a joint tobacco venture with the country’s main cigarette maker, and Thai property developer Amata halting work on a major industrial complex in the capital, Yangon.
• However, some businesses believe military rule may be more business-friendly than the ousted civilian government and, at least, faster at decision making, thereby opening up possible new opportunities.

Soundbite

“A decade ago, expectations generated by Myanmar's opening to the world were sky-high. Today's assessments will be far more realistic and conservative. From now it will be much harder, if not impossible, to attract first-class international investors” – Luc de Waegh, founder of business consultants West Indochina.

Sourced from Nikkei Asia

Advertisers struggling to leverage CTV effectively

Reaching the right audience is the most important consideration for practitioners aiming to deliver a relevant video ad experience, but few feel they are truly effective in this area. This is according to a WARC Data analysis of a Xandr survey of digital video decision makers.

Why it matters

Part of the lure of connected TV for marketers is the prospect of having data-driven audience targeting, frequency-capping and visibility over attribution to better measure business outcomes. Advertisers are investing more but achieving effectiveness is proving difficult.

Takeaways

• Less than a quarter of those surveyed said they are optimal in areas such as reaching the right audience, delivering effective creative and selecting appropriate media types.
• Additional research finds that connected TV accounts for two-fifths of streamed ad impressions, a level on par with mobile (app and web) devices.

Sourced from WARC Data's Global Advertising Trends: Next Generation TV. WARC Data subscribers can access the full report here. A free sample report is available to non-subscribers here.