The Pandemic Effect: Streaming is the New Normal
Streaming has long overtaken the cultural zeitgeist, but the pandemic’s at-home orders cemented its permanence and pervasiveness. About 80% of U.S. consumers subscribe to at least one paid streaming video service, and more than 70% have increased their use of paid streaming since the onset of pandemic. Many now consider streaming costs to be a utility expense on par with gas or electric. It remains to be seen whether or not consumers will flock to movie theaters – once the mainstay for quality entertainment – post-pandemic. PWC predicts they won’t: subscription video on demand revenues are projected to double box office revenues by 2024.
But there’s streaming, then there’s actually choosing what to stream. There are reportedly over 200+ streaming services available in 2021. With so many streaming options to choose from, devices to watch on (television, desktop, laptop, smartphone), and content to sift through – not to mention money to spend on it all – how on earth do consumers decide what to watch next? “Streaming fatigue” and decision overwhelm are rampant.
- There are reportedly over 200+ streaming services available in 2021 (Flixed).
- About 80% of U.S. consumers now subscribe to at least one paid streaming video service, up from 73% in the pre-COVID-19 survey (and versus 69% in Deloitte’s study last year) (Deloitte).
- More than 70% of consumers have increased their use of paid streaming since onset of pandemic (TransUnion via TVTechnology)
- The global streaming market was worth $42.6 billion in 2019. It’s expected to grow more than 20% per year and reach a total of $184.3 billion by 2027 (Grand View Research via Comparitech).
- Subscription video on demand revenues are projected to double box office revenues by 2024 (PWC Media Outlook)
- Increasingly, many people regard their digital E&M spending-a Netflix subscription or mobile data allowance-as a utility on a par with water or electricity and therefore a non-discretionary expense. (PWC Media Outlook)
- The average U.S. consumer currently pays for four different services, up from three pre-COVID-19 (Deloitte).
Additionally, there are hardware digital media players, which provide access to multiple streaming media material from a variety of web services. A few media gadgets are Amazon Firestick, Roku TV, Chromecast, etc. Such hardware might occasionally show working errors, like Roku TV Sound Issues; however, they are predominantly connection or setting problems and can be fixed without a hassle. Nevertheless, streaming platforms have created a mass market for the entertainment industry to grow.
With SO Many Options, How Do Consumers Decide What to Watch?
When it comes to deciding what to watch or even which streaming service to choose, studies show that consumers go to what they know (or trust). Many will turn to a show they are already familiar with (hence why Netflix paid $80 million for Friends), but most rely on recommendations: either from trusted sources of reviews and content or family/friends. Family and friends may help to a point, but don’t cater to unique or niche interests. This means that providing recommendations near topics or content consumers already know and trust will ease decision making and reduce overwhelm.
To tap into that familiarity that consumers appreciate, advertisers should create content recommendations in a warm, friendly tone. Create informative, trustworthy content to read like reviews, listicles, or personal stories.
- The most important attributes for a streaming service, per Nielsen’s survey, are the variety of content available (67%), ease of use (56%) and access to movies (52%).
- Netflix users spend on average 18 minutes deciding what to watch (Reelgood and Learndipity Data Insights via IndieWire)
- 67% said the biggest influence on what they decide to stream is the existence of shows they used to watch on broadcast TV now being available to stream (BGR) .
- 66% of respondents cite recommendations from family and friends as the main factor for determining what show or video content to consume and 54% cited reviews (e.g. online, blogs, in magazines, on TV, etc.) (Nielson via The Hollywood Reporter).
- Only 42% of respondents said they let what they see on social media sway their decision of what to stream (Nielson via The Hollywood Reporter).
Original Content Matters: How Can Advertisers Reach the Viewers Eager to Find It?
In a sea of streaming choices, consumers want a knowledgeable voice to be a directional guide. They are receptive to targeting and recommendations. They are eager to devour content like reviews, videos, recommendations.
This is one of the primary reasons why businesses use social media platforms like TikTok to promote their products and services. They typically hire a tiktok growth agency to connect with famous influencers. These agencies tend to assist popular tiktokers in creating videos or ads relevant to brand promotion. This is how influencers earn money and brands are promoted.
That way, businesses can reach consumers who are deciding what to watch next by distributing through digital channels and maximizing contextual targeting and context-driven optimization to serve ads that are relevant to the page they are already reading. (BTW ditch social media – this was the second-least influential factor according to Nielsen’s survey.)
According to Deloitte, it’s also imperative that entertainment companies continue to build their capabilities to harness customer data to deliver highly relevant or personalized content recommendations and targeted advertising. When a consumer gets a relevant recommendation, and they get value from the interaction, they are more likely to stick around. To provide a high level of value, a strong integration and a seamless user experience among all the content and services is key.
- 71% of millennials stated that original content was a primary driving factor in choosing a streaming service (Deloitte).
- Media and entertainment ad spend grew by 14.5% in 2021 so far (January 2021, Dentsu Aegis Network)
- 60% of US advertisers planned to shift ad dollars from linear TV to either CTV or OTT in 2021 (IAB via eMarketer, November 2020 poll)
Ads Mid-Stream: A Nuisance or a Way to Decrease Streaming Costs?
Two contrasting predictions emerged in research: one is that ad-free streaming will increase as consumers’ expectations for on-demand ad-free content (that Netflix popularized) increases; two is that the number of distinct streaming services is becoming excessive and expensive and consumers would prefer ads if it meant free streaming.
In the entertainment vertical – as in across all verticals – the abundance of choice has swung the pendulum from an advertiser-led mass distribution model to a consumer-driven, choice and targeted model.
“[I]t is likely that the mass personalisation of content experiences at relatively low cost and the resulting explosive growth in choice have altered the balance, perhaps permanently, between consumer spending and advertising. Companies find they can deliver immense choice at a price point that makes sense for both supplier and customer, while building powerful direct relationships-all without relying excessively on fickle or intrusive ads. E&M companies are increasingly in the business of delivering experiences and content directly to consumers, not delivering audiences and eyeballs to advertisers.” (PWC Media Outlook)
- 44% of consumers cite an ad-free experience as being a top reason for using streaming services (Deloitte via Comparitech).
- The leading cause of frustration with TV advertising among streaming subscribers is having to watch the same commercial repeatedly (cited by 46 percent of respondents) (The Trade Desk via MarTechSeries)
- Ads make up a whopping 20 minutes out of every hour of TV. 75% of viewers think this is massive overkill and 82% express frustration with having to see the same ads time and again (Deloitte via Comparitech).
- 40% of respondents are only willing to spend up to $20 per month on video streaming services (PCMag 2019 Survey via Deloitte)
- 65% of respondents say they’re comfortable watching ads to eliminate or reduce subscription costs (Deloitte).
- 47% of American consumers are watching at least one free ad-supported streaming video service, such as Pluto TV, Tubi, and the Roku Channel (18% growth since the pandemic began) (Deloitte).
- Free ad-supported video appeals to thrifty baby boomers and matures, who prefer free streaming options by 58% and 65%, respectively, over subscription-based options.(Deloitte)
- 84% of users rank cost as either extremely or very important when selecting a streaming service. (Nielsen Total Audience Report)
- Recommendations are valuable to consumers
- Reach consumers at their moment of intent to research and find a new viewing experience through contextual targeting and context-driven optimization capabilities
- Utilize customer data to offer personalized recommendations
The Bidtellect Advantage:
- Utilize contextual targeting and context-drive optimization to meet consumers at the moment of research and intent to watch
- Reach users currently streaming at 9 of the top streaming platforms, as well as 165+ TV audiences categorized by program, network, film genre, viewer type, and more thanks to Bidtellect’s partnership with Lotame.
- Each content advertisement is rendered in real-time to match the format and feel of the unique ad placement on the page, ensuring trust is built with the consumer.
- Advanced bidding platform will optimize to best-performing creative assets thanks to optimization capabilities or our detail-oriented platform specialists will adjust creative assets manually based on performance and expertise.
- Unique [b]+studio creative services offers expert copywriting and creative asset creation and/or expert strategic counsel dependent on needs to meet evolving standards of quality content assets.