When restless connected TV streamers express mixed views about ad-supported video-on-demand services, they’re sending us a message: The CTV ad experience needs to be better. A new study of CTV viewers by Verizon Media and Publicis points to opportunities for publishers and advertisers in this booming streaming market -- along with some educational growing pains and concerns about AVOD ad experiences. Check out the infographic here.
Unless noted otherwise, all data in this infographic is from the "Publicis Media & Verizon Media: Capitalizing on the CTV Opportunity" study, April 2021.
First things first: Steaming growth has gone exponential
Streaming adoption climbed 48% in just the three months between Q3 and Q4 last year, and the industry is responding with a new AVOD or SVOD service announced seemingly every month (Verizon Media internal data, March 2021).
However, new services mean more costs, and these streamers are reaching a tipping point around subscription price fatigue. Half of users share logins to keep costs down both for themselves and others.
AVOD grows to fill a need
While the vast majority of viewers regularly turn to premium, ad-free streaming like Netflix or Amazon Prime Video, TV ads are still hitting most viewers. Seventy-seven percent of viewers see ads across cable, live, or AVOD services, and 66% see ads via AVOD services of any kind.
Affordability is the primary reason why viewers try paid or free AVOD services. And AVOD, particularly Paid AVOD, is delivering value, with 70% saying there is no difference in "price for value" when comparing SVOD to Paid AVOD.
What's holding back AVOD at this point? Bad ad experiences.
Thirty-nine percent of AVOD subscribers are so irritated by advertising experiences that they've considered upgrading to an ad-free version. Another 23% actually have upgraded (typically to the ad-free version of Hulu) because they were bothered by the ad experience. The risk here is AVOD services without an ad-free upgrade option risk losing their viewers to other services that irritate viewers less.
What could be so irksome about CTV ads? Here are some of the most common complaints:
How can publishers improve the viewing experience?
Improving the ad experience will make your advertising customers more successful. AVOD providers can look to cable TV as a guide, as 54% mentioned the cable TV ad experience as the benchmark for AVOD ad experiences.
Ad experiences that qualify as "Better Experiences" include approaches that give viewers more control, countdown clocks and ads that are entertaining or personally relevant.
Fortunately, there are multiple pathways publishers can explore to improve the ad experience.
Straight talk to advertisers
Advertisers may need your help adjusting to a more complicated ecosystem. Here are a few thought-starters for that conversation:
The future of CTV and AVOD is exciting, even with its current imperfections and growing pains. We are in a phase where advertisers and publishers have opportunities to not only fix the pain points, but to also reimagine what a "great" viewing experience can be -- even going beyond the gold standard set by cable TV. Working with strong technology partners who can embrace and support a spirit of experimentation can help you figure out the best possible solutions.
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