Spotlight on Multiscreen Video Advertising Convergence
As consumers move into multiscreen modes of media consumptions, the advertising dollars will follow with well-managed multiscreen campaigns
Media, especially video, is a world on the precipice of immense change. The headlines say it all: “The New Rules of Content,” “…the TV Business May Be Starting to Collapse,” “The New Economics of Media,” “The future of TV.” The entire media landscape is changing, and everyone with a stake in the game – service providers, content producers, device manufacturers, and advertisers – are impacted. Right now, people are watching video whenever and wherever, on the go, at work or at home. The array of video capable devices available on the market, from feature phones to smart TVs, means that the way we watch video will never be the same.
The landscape may be changing, but TV is still at the center of the consumers’ media world. TV is one of the most common media in the home, beating out the internet and mobile devices by time spent with the widest reach across age and ethnic demographics. As a result, TV has unmatched clout in the minds of advertisers, and it still dominates the media landscape in terms of share of ad spending.
However, digital media is also the most disruptive and fastest growing consumer channel. The democratization of news and print media online virtually decimated traditional advertising revenues, famously trading print dollars for digital nickels and pennies. Online display ads are cheap, while digital video spots remain in-line with TV for some premium publishers.
Where media fragmentation is a challenge, convergence and content democratization are opportunities. Convergence inherently adds value to the video advertising ecosystem as a whole, allowing for better reach, influence and analysis. Some agencies are shifting their tactics by expanding TV teams to incorporate digital pros or vice versa, but there is still work to be done. Speaking to the American Association of Advertising Agencies Transformation Conference as quoted in AdAge, Aegis CEO Nigel Morris talked about how the digital generation’s ideas can help manage consistent messaging globally: “…we have to drive convergence. The industry has not done a good job in terms of flattening out agency structures and fostering innovation from young people...we have to take organizational design more seriously.”
The advertisers who come out on top will be determined by their ability to integrate the traditional and emerging video experiences best, blending new media with traditional in a way that not only streamlines process but also benefits brands. In a world where single digit shifts in mindshare can make or break a quarter, the growing influence of multiple platforms and the impact of converged marketing cannot be ignored.
Reframing Convergence for the Single-Minded Advertiser
The reason that TV buying is so ingrained for the video advertiser is habit: TV advertising is a known, trusted model. Nielsen’s gross-ratings points (GRPs) have standardized the buying process over the last 70 years, making it easy for both content owners and advertisers to negotiate and close deals. Advertisers generally know what they get when they buy a TV spot, but in reality it often falls into the old Wanamaker adage: “Half of my advertising is wasted…I just don’t know which half.”
Digital video buyers work in silos, just like their TV counterparts. Often, digital video budgets come from online display or TV and are executed separately from TV buys, which creates an atmosphere of competition. Measurement and pricing is improving with accreditations from the Media Ratings Council and the consolidation of vendors, but there are still lots of unknowns out there, especially for traditional advertisers used to a single GRP.
The first step is to look at the latest consumer trends: how are consumers using and driving multiplatform video content today? While there are 289 million US homes with at least one TV– the majority own two or more – video capable mobile devices are flying off the shelves. More than 900 million smartphones and 172 million tablets are expected to ship worldwide this year, with video consumption reaching upwards of half of tablet users.3,4
The second step is to highlight the value of convergence: what is the current state of spending and how can convergence benefit the advertiser’s bottom line? New studies show that adding online/mobile to the video mix (or even beginning a campaign with it!) not only increases reach but in some cases can double effectiveness. ]
Third, we take a look at the challenges and next steps that the industry as a whole must face. Multiscreen campaign management, measurement, fragmentation and a lack of standards are just some of the issues facing convergence.
The Converged Consumer
Video trends are almost entirely led by the consumer. We’ve seen it when cable TV became widespread, not to mention the internet, video games, and even with something as mundane as the VCR. The explosive popularity of video online, via mobile devices and TV peripherals throws another curve in the media landscape, not only by adding yet more devices to watch, but by easing the barriers of multitasking and converged experiences.
The TV is still the center of the consumer converged experience. In addition to broadcast and cable services, 48% of TV owners streamed content to their TV through an internet-connected device, like a gaming console or set-top box (such as a Roku or Apple TV). In addition, the TV commands the bulk of commercial time, even accounting for ad skipping technologies like DVR and video-on-demand (VOD). Recently, Netflix and YouTube launched DIAL, a method to have connected TV’s easily launch applications and content from mobile devices. Whether they’re cord keepers, cord cutters or cord nevers, consumers will start to shift their eyes back to the TV set as they consume more content from online sources.
Several industry studies show that multitasking is increasing total time spent with media in recent years. For one, eMarketer’s Key Digital Trends for 2013 report estimated that time spent with media per day increased from 632 minutes in 2009 to 699 minutes in 2012. In 2012, time spent with TV, online and mobile – the three main video outlets – totaled 599 minutes, or nearly 9 hours of potential video exposure per day.
TV remained far and away the dominant media in the US, with 278 minutes per day watched by the average adult; a conservative estimate of 30% commercial time (20 minutes for every hour) results in approximately 83 minutes of commercials per day, or 166 30-second spots. After some quick math, the average US adult watched 60,590 30-second commercials on TV alone for the entire year in 2012. According to comScore’s latest online video rankings, which exclude mobile, nearly 180 million people watched 33 billion online videos during February 2013 for an average of 1,045.7 minutes per person.
The online video numbers decreased from the previous year, especially the number of videos viewed and total time spent. Three factors could have impacted this: comScore acknowledged a methodology shift in August 2012; there was an increased uptake of mobile devices by the end of 2012 (at 41 million smartphones, 39 million tablets and counting); and an increase in consuming mobile video (at 53% of tablet owners). While the overall videos watched dropped, ads and time spent watching them jumped significantly, and they reached a slightly larger percentage of the total US audience.
For mobile, eMarketer estimated that people spent 82 minutes per day using their mobile devices for non-voice activities – that means mobile users spent approximately 7544 minutes with their devices during Q4 2012 (92 days). According to the Nielsen’s “The Cross-Platform Report Q4 2012,” 40.9 million mobile subscribers watched mobile video for 323 minutes per month during Q4 2012: 969 total minutes watching video during Q4 equated to approximately 13% of total time spent using mobile devices.
U.S. Mobile Video Stats
While the number of mobile users and the time spent with mobile is dwarfed by both TV and online video, growth is high. Nielsen estimates that mobile video viewers in Q4 2012 increased 22.0% over Q4 2011, while the average monthly time spent with mobile video increased by 9.9% year over year.
Even with a relatively small footprint, mobile’s convenience and ‘always available’ status can make a big impact on overall media exposure. eMarketer includes media used while multitasking separately. If you watch TV and use your phone to browse the web for an hour, that hour is counted twice. Mobile time spent is a net addition to TV time, whereas reading a newspaper is more likely a singular activity and therefore takes away from other media. Indeed, studies show that most mobile devices, like smartphones and tablets, are used while in the home and multitasking like watching TV or listening to the radio. The reality is that the converged experience is here and here to stay.
This is just one example of how convergence benefits the industry today, even in a consumer led way. But there are still plenty of challenges around multiscreen campaign management including, duplicated reach and accurate measurement. These areas are where the industry players must stop following the consumer – and start taking the lead. It all ties back to one thing: enhancing an advertiser’s storytelling to draw in and engage consumers across devices and experiences/