We’re all searching for glimmers of hope and ways to make the best of the situation as we begin to cope with this unprecedented, incredibly scary worldwide health crisis.
As an integral part of the overall economy, marketing is, of course, already being pummeled on many fronts, including by the cancellation or postponement of mega-events like the Olympics and March Madness, not to mention the inevitable plummet in demand for all kinds of “non-essential” products.
Amid all of this, the predictable surge in video and traditional television watching as a result of children and adults alike needing to stay home to slow the virus’s spread represents one clear avenue of opportunity.
Nielsen’s recent report projecting that staying home could lead to a nearly 60% increase in the amount of content watched — on top of already historically high media consumption levels — has been widely referenced.
And if there’s been any data in the past couple of weeks that contradicts that surge, I haven’t seen it. Just the contrary.
Further, so far, it looks like consumers are indeed more inclined to say that they plan to spend more on streamed content due to the pandemic.
A survey conducted March 13-16 by Morning Consult found 19% of U.S. adults saying that they expected to spend more on movie and TV streaming services due to the crisis — nearly double the 10% reporting the same in the survey that firm conducted just days earlier (March 6-9).
Ad-serving platform SpotX reports that traffic and ad calls are up across the board, particularly with OLV and OTT/CTV. CTV viewership “is up every single hour of the day — with average viewership during March 12-18 up about 13% versus the previous week,” says the company.
How long those elevated viewing levels will last depends more on the economy and employment scenario than on how long we stay at home, in my view. And it appears that I’m not entirely alone.
“With businesses scaling back workers and analysts warning of a recession as global economies slow, a significant number of viewers may decide in the coming months to break away from cable or cut back on streaming subscriptions,” noted a recent New York Times article.
The piece quoted Craig Moffett of MoffettNathanson predicting that the increased streaming audience “will be replaced pretty quickly by the necessity of reducing monthly bills, when people will have to deal with the financial impacts of a recession.” Cord cutting “will accelerate with a vengeance,” but in addition, with large parts of the population out of work, “cost will become much more urgent,” and streaming players may end up in a price war, he said.
At least for the present, however, video is not only surging, but, particularly with key sports programming not available, becoming a lifeline for reaching audiences.
Or so recent data from some ad-tech platforms indicate.
SpotX reports recently seeing a 16% increase in video ad inventory across its global marketplace.
And while the retail and travel categories saw big drops in ad spending during March 11-17 versus the previous week, the beauty, technology and computing, careers, hobbies and interests, and sports categories saw notable growth.
Further, eCPM decreased just slightly between March 5 and March 18, SpotX reports.
Similarly, 4C reports that across all ad formats (including video, image and dynamic product ads), overall global ad spend through its Scope platform between March 1 and March 15 was relatively flat on a month-over-month basis, and up 25% compared to the same period in 2019.
(The total sample included more than $100 million in global spend across 500-plus brands and campaigns on Amazon, Facebook, Instagram, LinkedIn, Pinterest, Snapchat and Twitter.)
In other words, while growth has slowed as its client brands reassess their activity during the pandemic, “we are not seeing wholesale budget cutbacks,” confirms 4C CMO Aaron Goldman. “The closed ecosystems where people are increasingly spending more time as they seek information and entertainment during this pandemic should prove resilient as marketing vehicles.”
I asked Goldman to go a bit deeper on pandemic-driven trends thus far, and what he sees ahead.
Asked if SVODs will see a long-lasting audience lift, despite the economic struggles ahead, Goldman said: “I think in the short term, we’ll see a tremendous lift in
terms of hours spent with video as people remain in their homes. Linear TV, especially broadcast and cable news channels, are probably drawing more eyeballs for longer durations than at any time since
the pre-digital age, though that may be balanced to a degree by the sudden absence of live sports content. With ad-supported streaming, increased use means increased inventory overall, so the dynamics
there are different. We are seeing increased demand but also increased supply.
“The major shifts are between types of content,” he adds. “With a continued increase of social distancing, you’ll see time spent consuming content via streaming services rise quite a bit as we settle in and put our daily lives on ‘automatic.’ People will be looking for more psychological relief from the news programs, so children’s programming and other softer entertainment categories are likely to see a bump.”
For AVODs, might
the benefits of greater viewership be offset by eventual declines in ad spend even for streaming platforms, if a recession sets in?
“Audiences are pretty captive right now and spending more time on media,” Goldman says. “They’re not going to bars, restaurants, or sporting events. And as we know, ad spend always follows eyeballs. Marketers are looking at their media-mix modeling to see which platforms and types of content are drawing the highest audience engagement and when. Budgets will follow accordingly.”