Online video streaming continues to have an unprecedented impact not only on the global media landscape, but on consumer attention.
As the advertising industry’s “golden child”, digital adoption of Over The Top (OTT) video on connected TV (CTV) is driven by leaps in internet adoption, but also widespread availability of mobile devices, and a plethora of content. OTT Investment in APAC is expected to grow from US$4.3 billion to US$7.2 billion between 2020 and 2026, which is approximately a 67% increase in six years.
In Australia, Connected TV yields the greatest share of video inventory expenditure, taking share from both mobile and desktop, representing $3.3 billion AUD in advertising expenditure.
Global streaming giants like Netflix and Disney+ which once held consumer attention, are reaching an inflection point with early signs of market saturation. The preconceived notion of having unlimited access to a vast range of premium, high-quality video content was once enough for customers to subscribe to streaming services. Still, new subscription models and price hikes are testing consumer loyalties.
As a result, global video content providers are differentiating not only their offerings but introducing brand-new advertising experiences. In the last few years, Advertising Video-On-Demand (AVOD) and free ad-supported streaming TV services (FAST) services have soared to new heights, giving media owners access to enhanced yield opportunities, and media buyers with the potential to reach more consumers across a range of devices.
Building a Better Streaming Experience For The Consumer
In the history of digital, we’ve never seen such a rapid influx of new, premium video become available in the marketplace. In 2022, The Australian video industry grew by 12% year on year. This boom provides an unprecedented number of inventory opportunities for media buyers. Because of CTV’s digital nature, marketers have a much better opportunity to deliver better TV experiences on the web by accessing enriched data sets, giving viewers exactly what they want. So, why are consumers not seeing better quality and less duplicative ads today? The answer lies in CTV’s current buying structure.
Today, a media buyer may only see a CTV bundle like a FAST app, however, they’re unable to see whether the consumer is watching a specific show or genre. This results in one of two scenarios: the same media buyer purchasing back-to-back ad slots, or causing them to underbid, and ultimately lose the opportunity to present their ad in front of the intended consumer.
Jason Scott, CEO, APAC at MIQ DIGITAL, said: “The challenge today is that everyone has entered the CTV market on different protocols, with varying content information. As more streaming platforms become available to advertising and market competition increases, the industry is going to need a standardised way to communicate with each other to ensure relevant ads are reaching the consumer.”
In order for video content providers and technology platforms to help marketers match with the right consumer within the proper context, there needs to be a standardisation of content signals. Embracing signal transparency can not only improve targeting and performance for campaigns but can drive more yield for media ownersbecause their inventory can be better merchandised through curated deals and inventory packages.
On the flip side, in a turbulent economic environment, where marketing budgets are squeezed and consumer fragmentation is heightened there is an increased focus on performance and efficiency, which can only be delivered by a fair and transparent ecosystem. Opening up transparency is imperative to ensure the industry can continue to scale programmatic in CTV, and ultimately deliver the same quality viewing experience to the consumer, regardless of how they’re accessing the content.
Industry Standardisation Will Change the Evolution of Online Video
Over the last 10 years, the digital industry has come leaps and bounds, and 2023 will be no different. Today the industry sits at a crossroads, one that provides the opportunity for media buyers, media owners, app developers, and platforms to develop a more transparent and efficient CTV ecosystem.
This possibility is one step closer to becoming reality as The IAB Tech Lab works alongside industry leaders such as Index Exchange, to develop a set of standards called OpenRTB 2.6 that address the nuances of CTV environments. These standards provide the ecosystem with a consistent way to signal content information, genre taxonomies, and other metadata, to pave the path for CTV ads of the future.
Signal transparency provides media buyers with stronger contextual relevance to better inform targeting decisions, and has a direct correlation to increasing revenue for media owners. It’s on us as an ecosystem to ensure widespread adoption of OpenRTB 2.6 to accelerate the evolution of our industry.
Adele Wieser, Regional Managing Director, APAC at Index Exchange