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This series, brought to you by Xandr, explored where the future of advertising lies influenced by a COVID-induced digital acceleration, changing consumer behaviours and the rise of video.
It has been a year quite unlike any other, clouded with much change and uncertainty. A rapid acceleration towards digital, the rise of video on demand (VOD) services and increased content consumption are among the trends painting a picture of where the fate of advertising lies.
Samuel Tan, senior director of market development at Xandr, says with all of these changes, the industry has the chance to adapt and evolve for the future.
“Advertising needs to respond to that [change], helping monetize those opportunities and helping brands connect with their audiences in those different ways,” Tan says.
Consumers take control
According to Xandr’s second annual Relevance Report, nearly seven out of ten consumers acknowledged consuming content is part of their daily routine.
Conducted prior to the COVID-19 pandemic, the report found consumers were already averaging four hours a day of content consumption with 80% using their smartphones to consume all forms of content whether it be video, audio or written.
Consumers now have the ability to choose what they want to consume in the time and place that best suits them on the device of their choosing.
Tan believes the proliferation of devices available to consume content will likely continue and people will return to consuming content in ways that are less disruptive.
“I think about really simple things like Bluetooth headphones, where I now almost exclusively listen to news rather than reading it,” he says.
“From my point of view, people don't always want to be staring at a screen. They're happy to consume content in more varied ways that better suit their lifestyle and the way they want to.”
Throughout the pandemic, brands have had to shift the way they create content that engages with consumers.
Andy Morley, head of marketing at Uber ANZ, says the brand has noticed a move towards more engagement with user-generated content (UGC) - something which he believes will continue into the future.
“This has driven some incredibly innovative approaches to production including greater use of user generated content, leveraging video conferencing tools such as Zoom, and also repurposing existing footage to create new stories,” Morley says.
“In many cases we also found that consumers are engaging more with the raw UGC than higher production value, further demonstrating a desire for authentic real content and the strength of these new methods.
“I think we’ve unlocked some new production approaches here which will stay, and this allows us to increase our volume of content and storytelling which is exciting.”
As consumers continue to take control over the content they engage with, brand integration will make a comeback according to Peter Hammer, managing director of market research firm Marketing Scientist.
“It's really about trying to find those advertising opportunities that can't be blocked and that can't be skewed,” Hammer says.
He notes that the results from numerous studies have revealed that in-show placements are highly effective but can be more so when combined with ad spots or a supporting sponsorship.
“It actually drives even greater impact across all those different metrics,” he says.
“It's good news for the ad-supported VODs as well as the ad-free.”
Beyond brand integration, the world is entering an era where consumers expect more from brands and simply selling a product or service will no longer suffice.
Advertising messages will have to go beyond the hard sell and show what they stand for without appearing to have a case of woke-washing.
“Ultimately the biggest legacy of COVID-19 will be greater authenticity from brands,” Morley says.
“For some time, our approach at Uber has been to focus on acts, not ads. We are always looking at ways to create meaningful impact and put action behind our brand promise to customers. This has only become more important during COVID-19.”
Consumers may be dubious of brands and their messages, but Morley says building trust is key to a long-lasting relationship.
The rise of VOD
VOD services, whether they be subscription or broadcast, have become prominent choices for consumers today looking to watch interesting and engaging content at a time and place that suits them.
While the rise of broadcast video on demand (BVOD) has helped lure back audiences who aren’t able to keep up with programs on linear TV, Brett Poole managing director at addressable TV business Finecast, part of WPP’s media investment arm GroupM says growth among subscription video on demand (SVOD) services like Netflix, Disney+ and HBO Max will cap out eventually.
Hammer agrees. He says sustained growth will soon slow and more interest surrounding ad-supported VOD will come into play.
“We're seeing that more than two-thirds of the population now have access to SVOD services,” he says.
“Our report showed that SVOD services offering a cheaper ad-supported pricing tier would
be likely to capture more subscribers overall.”
Overall, Tan says VOD and over-the-top (OTT) services will provide new opportunities for advertising.
He says header bidding in OTT will create more equal opportunities for brands to access a TV audience that was once solely available to those who bought upfront.
“It will enable the ability for an OTT provider or a streaming service provider to allow brands and marketers an equal playing field and access to inventory, which is so different to the way most TV gets booked,” he says.
The metrics and processes used to measure the impact and success of advertising are set to change over the next few years.
Already over the last 18 months, Hammer says there has been a substantial shift towards cross-platform measurement as advertisers seek a holistic view of the consumer.
“There has been a focus more on total TV or total video to better understand how people are consuming content and advertising across all those devices, platforms and content brands,” he says.
“Ultimately, by better understanding that, advertisers can then create campaigns that will resonate with consumers in a different way across those different environments.”
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