Summit Snapshot: Consumers Turn to Advanced Television amid a Pandemic, As Do Digital Marketers

August 6, 2020

Big Idea: A dynamic market in streaming is met with an adaptive approach to advertising and evolving modes to address, extend and educate about consumer privacy.

In the time of COVID-19, lifestyles across the globe have changed dramatically, from exercise and food shopping, to the way people watch TV and listen to music. At the Digital Advertising Alliance’s Virtual Summit 20, I had the opportunity to moderate a panel -- Ryan Fleisch, head of product marketing for Adobe Advertising Cloud; Holly Grochmal, general counsel at Pandora; and Amy Guenel, vice president of product marketing at Tremor Video -- to discuss streaming, OTT (over the top television) and its growing role in the digital advertising ecosystem. It’s not the first time advanced, connected television has come up at a DAA Summit, but there’s a lot of investment going on in this newest of addressable platforms, even without COVID-19, and brands want to connect with consumers here.

Understanding Streaming

Streaming now accounts for nearly a fifth of TV viewing, if not more. Media planning, targeting, engagement measurement, attribution -- all of that -- as well as how we manage compliance for privacy’s sake – are parts of our addressable television learning curve. Consumer experiences and expectations here, too, are being assessed – not just on the platform, but across platforms, among them OTT, and how they engage with content and advertising here.

Adobe’s Ryan Fleisch reflects upon evolving methods of message delivery that the growth in streaming presents.

“Consumers don’t think about the different channels they’re on,” Adobe’s Fleisch said. “They want highly relevant, and connected messaging across all different digital touch points. If we can have access to all of those, and help brands take the same audiences, the same data, the same messages, into not just streaming video but streaming audio, paid search, whatever the channel might be, that’s ultimately going to result in a better customer experience, and we want to make sure that brands can capitalize on that wherever their consumers are moving between.”

“We’ve seen a lot of parallels behind what happened with the move from terrestrial radio to streaming audio,” Grochmal said, speaking from Pandora’s experience in digital audio. “Regardless of the platform where the advertising is coming, you’re going to see those same themes carrying across each of the relevant platforms as we move into innovative spaces.”

“It’s really important to work with a partner that can help streamline the ability to reach audiences across all of those devices and screens,” Tremor Video’s Guenel.

DAA agrees. Part of this cross-device, cross-platform competency is honoring consumer privacy expectations, and enabling relevant content in a manner that extends transparency and consumer choice for addressable ads in line with DAA Principles.

Educating Marketers for the New Age

The shift toward streaming in consumer preferences and behaviors, according to the panelists, has brought about a new emphasis to educate the marketplace, which brings together left- (analytical) and right-brain (creative) thinking.

Fleisch spoke to digital marketing’s evolution during the past 25 years, with its emphasis on measurement and accountability. “We’ve found this good balance between what used to be more of an offline era where creative ran king in a linear television world, and you didn’t have measurement,” he said. “And now those two converged, and we have channels that are streaming that allow better creative messaging, but also with the data behind it, it can create some really powerful things,” namely the ability to target consumers with a meaningful message depending on where they are in the funnel of decision-making.

Pandora’s Holly Grochmal echoes the need for advanced education on consumer privacy in the modern digital advertising ecosystem.

Grochmal emphasized understanding the audience, making sure to deliver the right message on the right channel, as well as retaining focus on privacy and communication with adherence to DAA Principles. 

Messages that Resonate, with Transparency and Control

It is true that the DAA program can serve as a transparency framework for data collection and use in streaming services and consumer privacy adherence, but implementations continue to be refined as the medium grows.

“One of the tactics that we’ve seen has been very successful is tapping into automatic contact recognition [ACR] data,” Guenel said. Smart TV manufacturers “learned the hard way that consumer privacy needs to come first, and… all of the manufacturers have pivoted the way in which they [consumers] are now opting in, and allowing consumers to opt out of [data collection used for] advertising.” With ample attention given to transparency and privacy, advertisers can better assess the impact of a brand’s ad.

We know consumers value content that is ad-financed, and that extends to streamed video programming.  Even as paid subscription services in on-demand television grow, so do ad-financed platforms.

The average consumer spends upward of $60 on streaming services per month, and according to Guenel, “we will see more and more consumers shifting over to the ad-supported video-on-demand solutions… they know by watching some ads [consumers] get access to ‘free’ content.” She predicts significant growth in that sector for the rest of the year, and the other panelists spoke to a certain equilibrium between paid and unpaid services

Statistics reveal a continuing trend away from conventional, linear television and a growing need to re-evaluate advertising priorities as a result.

According to a study conducted by Adobe Advertising Cloud, 76 percent of consumers are willing to view ads in exchange for free content. Fleisch stated that “the surveys that we just launched actually found that there’s been 18 percent more consumers that have signed up for subscription services since the start of COVID-19.”  Homebound consumers are turning to their screens – for video and more.

“It’s important across all of the content platforms to have that balance in the mix. One size does not fit all for each consumer,” Grochmal said in reference to streaming services of both subscription and ad-financed platforms. “Being able to support the content providers, have monetization channels, and have multiple options of whether it’s a subscription or an ad-supported, is going to be a key function of the ecosystem... across all streaming platforms going forward.”

Privacy Matters Matter – For Consumer Trust

The DAA Principles largely were formed at a time before streaming services, but as a principled framework they are instructive -- transparency, control, security, sensitive data, and so on.  Is the advanced television marketplace embracing these fundamental pillars?

“Education is really key ...” Grochmal said.  “The more we can educate consumers about what we’re doing and just be really clear about it, I think the better for the industry, the better for consumers --  it's a win-win for everyone.”

“[W]e need to handle consumer privacy in a more holistic way,” according to Guenel. Standardization is key.  “Then of course maintaining direct connection with the DAA and those principles.”

COVID Meets Streaming – Will Consumers Stick to New Consumption Patterns?

The panel also addressed the pandemic explicitly – both its impact on consumer behavior and its potentially lasting effects. Much of the nation was still in the grip of winter when at-home orders began – and that kept people close to their streaming devices.

“Absolutely it’s changed for the long term here, around consumption habits, and what people are signing up for, and how they’re used to consuming content here. I think a lot of brands might be a little unprepared to capitalize on that,” Fleisch said. He outlined some prerequisites a company might need to capitalize on the situation. “The main thing is do you have tech partners in place that have access to all the digital touch points, that can really be fluid with how you act across those.”

“Across audio, we’re seeing a lot of pivoting from live events, too, right, you’re seeing usages of new platforms and technologies to enable that,” Grochmal said. “In the music industry, a large component was live events where you’re actually at a concert and now that’s just not possible.”

She mentioned that change in consumer habits is certain, but its long-term direction is unclear. “It’ll just be interesting to watch out for how much of this new technology is sticky,” she said. “I don’t know all the answers to it, but you’ve got to be flexible, you’ve got to have those tools.”

Amy Guenel articulates how COVID-19 has forced Tremor Video to adapt and overcome in the face of a pandemic.

Guenel summed up what the pandemic has required of Tremor Video. “Really just capitalize on these shifts of consumer behavior. The other piece is having access to nimble creative development.”

In my take on the panelist discussion, DAA sees its transparency-based framework acts as  privacy guideposts in this new and still-emerging area. Allowing this kind of flexibility and quick adaptation to new trends is a key part of successful self-regulation. This provides both consumer privacy controls and the ad-subsidy that many streaming services rely on as part of their multi-faceted business models. We will be ‘watching’ and ‘listening’ to learn more about how this medium advances and how our Principles can assist to protect the tremendous value society receives from streaming with relevance. We know consumers benefit from these kinds of streaming services – and they assign rich value to the ad-financed content that is made possible through responsible data collection and use, namely about $1200 a year. That’s a powerful value proposition – made possible by digital advertising.

DAA wishes to acknowledge the editorial contributions of our summer associate Paul Lozaw to this report.

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