Media agencies drilled into Foxtel’s new streaming future, with addressable tv at its core, backed by a strong suite of content in 2022.
Foxtel clearly differentiated itself from the three commercial networks, say industry insiders. It’s all digital and streaming.
And the latest advertising initiative was welcomed, with clear appeal to agencies. Foxtest allows brands to run experiments across advertising content, experience, and data. The new offering represents a $3 million investment from the media company
Mark Coad, CEO, IPG Mediabrands Australia: “They are doing a great job moving from a subscription to streaming model.
“With an ambition to serve all ads digitally there are many exciting things to be done executing with precision, at scale against their 4 million subscribers. They have a good story there, and it was well told and will (or should) interest many advertisers.
“Foxtest is an idea I loved, and it shows a great appetite to shift some traditional approaches and work with new metrics, new currencies, new approaches, etc.
“I also really liked the way they delivered this session – showcasing and sharing the stage with some of their broader talent, great to see.”
Wayne Jarvis, Mindshare Sydney Investment Lead: “Positioning themselves as a house of brands and transforming to a streaming company, Foxtel is moving away from legacy perceptions and priming for success.
“Personally, from a content perspective they could had started and ended with House of Dragon and that would have been enough. More seriously, they presented a strong spine across multiple platforms, with focus and investment in local content, sport and must watch international programming. The most interesting new development is Flash, it’s a unique proposition that should deliver new eyeballs, scale and unique audience segments.
“The upcoming innovations in Foxtel’s ad deployment capabilities are interesting, with potential new formats, and ease of cross platform buying and campaign delivery. Advertisers will welcome these developments and the $3m commitment to campaign effectiveness and innovation via Foxtest will improve trial of their platform, and lead to some strong innovation outcomes.”
Ben Willee, general manager and media director, Spinach: “What’s not to love about upfronts. Action, excitement, sports and more musical montages than an 80’s movie.
“It’s clear Foxtel is going through a period of rapid change. They have worked very hard to strike a balance between audience needs and advertiser needs, and it shows.
“Their key strength is they are one of the few dual revenue businesses (advertising and subscription revenue) and that means they can be nimble and flexible.
“Having 70% of their campaigns traded dynamically enables salespeople to spend less time on trading, and more on upstream thinking.
“Foxtest looks like a really interesting proposition that I think will really appeal to full service agencies and creative agencies. The more focus we can put on ‘test and learn’ in high engagement environments will deliver better outcomes.
“We’re all looking forward to taking advantage of their ability to deliver addressability at scale.”
Daniel Cutrone, head of media, Avenue C: “The Foxtel upfronts gave us a peek under the hood of Australian SVOD viewers, stating that 85% of homes will have an SVOD service by 2025. So, for advertisers, this means we need to find ways to access this premium and rapidly growing audience, who are migrating from more traditional linear models.
“Foxtel’s ambition is to adapt their entire business to be 100% addressable - it’s a big task, but if they pull it off, it will mean their offering becomes a must include for many clients.
“There is a compelling 2.6m combined audience, who are considered the “unreachable” in the FTA TV landscape. The replacement of Foxtel’s traditional cabled boxes with cordless IQ5 brings them closer to the end goal of 100% addressable, however, roll-out may be slower than anticipated. There was a focus on their ability to take the stress out of TV audience delivery with their 97% campaign achievement average, a smart move when linear audiences are declining each year.
“International long-awaited programming like House of Dragon, the Game of Thrones prequel and freshened local favourites like Love it or List It, Selling Houses Australia, Great Australian Bake Off and Celebrity Gogglebox, plus new local franchises Repair Shop and Selling in the City, and the most robust sport offering in the market, will keep audiences engaged in 2022.”
Seb Rennie, chief investment officer, GroupM: “The energy and confidence from the team was clear, and it was a strong and entertaining showcase this year from Foxtel.
“Foxtel focused on the transformation their business is undergoing; from a subscription TV business to subscription streaming video business. It’s a unique proposition with a future-focussed ambition to serve every ad digitally and drive innovation.
“Flash is a compelling news content proposition across a multi-screen environment - delivering on the demands of this audience, and the investment in Foxtest to drive innovation is impressive.
“When it comes to content, Foxtel’s strength in sport is clear, and it’s premium lifestyle programming, along with a slate of home-grown drama and Docos, mean that it has a diverse and varied line up to draw in new subscribers and keep existing audiences entertained.”
James Lucas, group trading director, OMD Brisbane: “The 2022 showcase didn’t feel like the typical Foxtel upfront. As to be expected, it was a slick, balanced and well-paced showcase covering the highlights of the year that was and an overview of what’s ahead. However, it was the content of the presentation that made it feel less like a 2022 upfront and more like a broader update from Foxtel, covering the strategic roadmap for the business.
“At the core of this is building a business that is customer focused and IP led, with a clear ambition of becoming Australia’s most dynamic streaming company. To achieve this, Foxtel believes it needs to move away from being a single group TV brand to become an offering of genre lead streaming services. It is a strategy that appears to be working, evident in the company’s FY21 financial statements and significant growth in subscribers across their entire product range. The launch of Flash looks set to continue to build on this further, as does the network’s overall programming strategy which remains well-rounded and covers a wide spectrum of genres.
“Where free-to-air networks spoke to their ‘total TV’ product offering, we instead saw Foxtel refer to their bread and butter as ‘intelligent video’. This will be their differentiation in the premium video market. Foxtel’s product offering, or where it will end up, is addressable media as the network is actively working to a goal of serving every single ad digitally.
“Foxtel’s ambition of delivering 100% of ads digitally is an achievable goal and is already underway as the network begins rolling out their iQ5 box. The technology in this device has now made connecting to a cable or satellite a thing of the past. Foxtel’s ‘linear broadcast’ now has the framework in place ready for digital ad insertion down the track. A cross-device, premium video solution will be incredibly enticing to advertisers seeking engaged audiences leaning in to advertising supported content. With more than four million subscribers this is now something Foxtel will be able to do at scale. From a media execution perspective, this would be a powerful selling point for Foxtel especially when considering the advanced measurement and targeting solutions this would offer.
“With the advancement in technology and customer demand also evident, Foxtel’s focus now needs to move to combining the two and continuing to evolve their data offering. An update or roadmap on Foxtel’s data product or offering was noticeably absent from the showcase presentation and will hopefully be presented as a follow-up in the new year.
“The Foxtest initiative will no doubt be something many advertisers and agencies will be interested in learning more about. The showcase touched on potential opportunities including the use of data, specifically around the matching of first party client data and how this can be used in an addressable advertising solution across the network. It was noted that a large retailer is already working through this in conjunction with Kayo.
"In general, the Foxtest initiative sounds exciting and will be tackling some big topics including how to leapfrog the market in areas such as content, ad experience and data. With only 10 spaces available, I imagine Foxtel will want to partner with advertisers operating in a partnership mindset, with research projects looking to answer mutually beneficial challenges.”
Joanna Fawkner, Zenith head of investment - Melbourne & Brisbane: “The Streaming not Subscription and House of Brands positioning were very clear across the entire presentation, and that’s not surprising from Foxtel given where their growth is coming from.
“With such a focus on the strength of the total platform it was almost easy to miss that the linear service was barely mentioned outside of the iQ5.
“The investment into their brands (Kayo, Binge, Flash) demonstrates how they are fusing quality content with a superior viewing experience for their customers that they cannot get anywhere else. The streaming war is front and centre and it is clear that this is Foxtel’s priority.
“I felt the focus on non-sport programming was a little light-on and I would have liked to have seen more - as well as detail around timing for key content. While we know sport drives a lot of subscribers, general entertainment also makes subscribers sticky, and it’s the differentiator not only in the streaming market, but also against the free to air networks.
“UNSCRIPTED CONTENT: Foxtel’s focus on unscripted content is a continuation of an existing and successful strategy. Lifestyle in particular has a fairly good strike rate for local productions, and they are consistent performers. I know it’s all about aspiration, however I can’t help but think the new Selling In The City is just another property program that reminds so many of us how unattainable city property can be.
“Subscription numbers are in healthy growth and the recent launch of Flash will continue that trend. The guest appearance from Randy Freer would suggest the long term strategic direction could see Foxtel offer a blended commercial model to customers, giving advertisers the ability to target a highly valuable audience you can’t reach anywhere else – a significant game changer for Foxtel and a proven model e.g. Hulu and Spotify.
“SPORT: I loved the focus on women’s sport, and the challenge issued to advertisers to increase their support. With investment into women’s sport just 1.6% vs men’s - there is a long way to go in order to match sentiment with investment.
“Foxtel continue to focus on Australia’s top tier sports and are continuing to invest into the viewing experience. With the AFL, NRL and Cricket at the heart of the Kayo offering it’s a very strong anchor and keeps subscribers on platform year round. The opportunity I see for Foxtel will be to continue building on the viewing experience and exclusive content.
E-commerce has been front and centre for many networks during this year’s upfront season, but it did not surprise me that Foxtel did not come to market with an offering. Foxtel’s focus is on repositioning themselves in the streaming landscape, and their focus is very much on the customer experience. Good content and great viewing experience is what will help them succeed.
“We know Foxtel have a history of innovating, whether it be introducing the market to Dynamic Trading or producing new ad formats such as Q Breaks. With the announcement of FOXTEST, I believe this puts them at an advantage, as they have committed to investing into initiatives that the market asks for and if that is an e-commerce offering, I am confident that it will be built with the customer first.
“Foxtest Advertising Initiative: Foxtest was an exciting announcement demonstrating the commitment to proving effectiveness and driving innovation. Networks putting investment behind these initiatives will help agencies and clients approach campaigns differently, and allow for more robust measurement frameworks to show the value of the Foxtel customer – outside of traditional metrics.
“97% campaign delivery, on time, on budget” – given the volatility of the past year or so, this is a compelling statistic, and brings comfort to clients. I also found their statement that GO has tripled ad revenue since facilitating state-based advertising very interesting, it’s a great example of how much of an impact a small evolution in targeting capability can have on the bottom line.”
Sue Cant, Head of Media, AFFINITY: “It’s awesome to see that as of next year, Foxtel are opening up their Foxtest ad experimentation platform with the first focus on innovation; and with no less than an investment of $3m behind it, it shows that they are wholeheartedly backing themselves to find the right solution for us as agencies and clients alike. Working with clients with smaller innovation budgets requires smart thinking and with Foxtest we can start to really trial different options to get the right outcome.
“Foxtel have always been committed to their premium content but was great to see more focus and investment into local content, and a great 2022 drama slate with the additions of The Twelve and Love Me, a very welcome change from the mass of reality entertainment formats at the moment.
“One other announcement that I will be keeping a very close eye on is the launch of Flash, and Foxtel’s ambition that it will do for news content what Kayo has done for sports but if anyone knows how to do it, Foxtel do. However, I am a little sceptical on just how big that pool of ‘new’ customers will be.
“Another welcome addition for 2022 is that we will, for the first time, be able to buy Kayo only media packages. Finally, a way to really capitalise on the strength of this service in its own right – a great decision from Foxtel Media.”
Justine Butler, Media Merchants Media Director: “Strong focus from Mark Frain and the host of presenters around the collective power of the Foxtel network and their active subscribers, with the added boost of client case studies to give it more credence was great to see.
“I applaud a bold effort to call out advertisers to support women’s sport, but hope they back up with a sensible commercial offering to do so, whilst continuing the diversity discussion from a news perspective with Flash.
“It was a bit light on content when compared to the other major networks, but what was clear was that Foxtel doesn’t want comparison to the big three commercial networks, seeking to clearly differentiate as a streaming digital network. If they successfully deliver on the cross platform dynamic promise and ability to serve all ads digitally - while continuing to deliver audience guarantees - they will cement this.”
Daniel O'Brien, commercial director and head of strategy, Frontier Australia: “Overall, it was a strong showing from Foxtel Media this year who appear to be well-positioned to deliver on and becoming a streaming/ intelligent video-focussed business versus a subscription TV network alone.
“This is a key differentiation point they will clearly leverage into 2022, when compared to the free-to-air networks. The presentation landed the plan on this point well and the use of the team to deliver this was a nice touch.
“With the introduction of Flash combined with the existing strength of Kayo and the wider streaming products offered by Foxtel, 2022 could be a big year for them in terms of share of ‘total video’ advertiser investment.
“Foxtel's content pipeline also looks good and Foxtest demonstrates a progressive and innovative approach that I’m sure will be well-received. A key challenge for them will be simplifying planning and trading across all the various assets and making sure they are easy to buy and measure across all formats.”
Sam Buchanan, General Manager, IMAA: “Foxtel's transformation and evolution continues with an Upfronts that was impressive and done their way. It struck a good balance between substance and steered away from gimmicks. The refreshing use of their staff on all levels gave it a fantastic, authentic touch.
“Like all upfronts, it highlighted some impressive audience and streaming growth, engagement numbers, and investment in technological advancements. One of the more notable announcements was the launch of the Flash which I believe has a place in the market.
“Investment in scripted content and lifestyle shows was another strong point, while the Foxtel team highlighted their sports credentials and challenged the market to get behind women's sport.”
"One of their newest products that will contribute to this growth is their SVOD service, Flash. It’s the first of its kind, but Foxtel’s third foray into the SVOD space so they’re confident it will be a hit with Aussie news enthusiasts. And promising that it will, as Kayo did, attract a new audiences which is great for us and our clients as we’re always looking for ways to grow incremental reach of our campaigns.
"They’re also focusing on innovation by launching their Foxtest product next year that will allow 10 advertisers to partner with them, using their innovation budgets, to pioneer new ad formats testing content and data to push the boundaries of video advertising. A great opportunity for brands with innovation budgets, but it will be interesting to see if any of these get rolled out as products for smaller advertisers, or if this type of innovation will only be partnership based.
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