The best performing digital content is tailored to its environment, according to Kantar’s Media Trends and Predictions 2023.
The report gives a definitive view of coming media industry trends, with a focus on new viewing habits, soaring costs, data usage and new technologies.
"Whether it is new platforms or ad formats, the options for digital advertising seem to increase daily," says Straford Rodrigues, head of media at Kantar Australia.
"The most impactful way to work is to embrace the uniqueness of a platform and do something that is customised. The challenges of a post-cookie world are heightened by ongoing and potential ‘privacy wars’ between those companies looking to monetise user data and those prioritising customer privacy.
"Cookies, imperfect though they were, provided at least a common DNA. It’s highly unlikely they’ll be replaced by one solution that is as widely adopted.
"Most advertisers are likely to take a portfolio approach and will continually reappraise data sources. Some platforms will look to machine learning to provide privacy-enhancing technologies that can make tracking and targeting acceptable in their environments."
Rodrigues reveals the impact of three of the top predictions for the Australian industry:
VOD embraces appointment TV strategies
"Marking a new chapter for the TV and video market, the winners in the platform wars will deploy hybrid strategies balancing VOD (video on demand) and linear content. Broadcasters are adopting aspects of VOD strategy that fit their positioning while preserving their points of difference, and VOD platforms are adopting traditional concepts like ‘appointment TV’ and curated content discovery. The market will shift away from all-at-once release strategies and box-set bingeing for new content to maximise revenues.
"In Australia, SVOD (Subscription Video on Demand) penetration and share continues to fall among households with under 25-year-olds present in the home.
"While linear broadcast audiences for sports, news and special events remain robust, viewers increasingly expect to be able to choose when they watch other genres. BVOD (Broadcaster Video on Demand) on the other hand has seen strong growth during and post lockdown."
Ad-supported models the answer to inflation worries
The 2022 study showed that consumers are more accepting of advertising. As rising costs are making ad-funded content more palatable, the timing is right to introduce ad-funded tiers to limit price-sensitive churn.
However, ad-models risk creating two types of viewers: those with less disposable income who become over-targeted by ads, and those with more disposable income, who are more attractive to advertisers, but are harder to reach.
Rodrigues: "In Australia (like in other parts of the world), we’re moving into an era of hybrid models for VOD. What remains to be seen is the degree to which the numbers will go round. Ironically, the same economic pressures affecting the willingness to pay for SVOD may also inhibit purchasing in other areas, which could limit advertisers’ budgets to buy media in the first place.
"Australia is simply not seeing the same growth in consumer advertising equity as seen in many other markets as Aussies are less receptive to advertising on channels – most noticeably digital.
"Short ads that offer minimal disruption to the viewing experience are more common on AVOD services, and Australians prefer this format when watching TV. As a rule, advertisers must focus on ensuring that digital formats are not intrusive and repetitive."
Contextualise or fail
Rodrigues says marketers must prepare for a post-cookie landscape by experimenting with proxy-based targeting systems and contextual advertising.
"Targeting within closed ecosystems (in which consented first-party data is available) will still be possible, but wider cross-platform targeting has hit the barrier of consumer privacy.
"There will be incremental improvement in the coming years, but the hyper-targeted ecosystem that the internet once promised looks increasingly unviable and initial assumptions about the granularity of targeting outside closed ecosystems may have to be reappraised."
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