The Future Of The Entertainment Sector Revealed At ARF Conference

  • by , Op-Ed Contributor, September 23, 2020

Day Two of the ARF’s virtual AudienceXScience Conference highlighted an investment banker’s view of the future of the media and entertainment worlds post-COVID, stressed the value of high “gender equality measure” (GEM) in ads for incremental sales lift, provided insights on mobile advertising effectiveness, and, offered “attention” (noticed) as a possible common cross-media currency metric for consideration by the World Federation of Advertisers (WFA) in tits proposed technical measurement design draft just released.  

Laura Martin, partner, Needham & Co, has studied the entertainment business for long- and short-term returns along with associated risk factors for many years.  Media companies were her focus notably TV/video.  Demonstrating the value of insights developed from extensive multi-faceted research by an executive with deep experience, Martin painted a fascinating picture of the major media and entertainment sectors after Covid and their likely positions and value out to 2024.  The ad revenue declines for this year are already staggering for the traditional media.  



While subscription video-on-demand (SVOD) is experiencing huge growth, it is projected that advertising-based video-on-demand (AVOD), which is free, will surpass SVOD in revenue and share of viewing time by 2024.  The current growth rate of both models is being accelerated by Covid.  With reference to cable subscribers moving to streaming services, non-connected TV homes, currently 31.2% of homes, will rise to an estimated 46.6% of homes.  Martin suggested, “it’s chord-swapping, not chord-cutting” that is evolving as households look to higher broadband delivery to eliminate buffering.  

In terms of physical media -- including live sports, theme parks and live entertainment -- it is estimated total revenue losses from all sources could reach $400 billion per year!  

The consumer/technological video complexity and evolution across all the key business indicators reveals quite different ad/subscription and viewership time shares by the major players comparing 2019 to 2024 estimates.  However this TV/video sector evolves in relation to the entire entertainment segment, it was posited that lifetime value of customers will remain paramount.  Low churn rates and retention will be critical to the companies involved driven by differential content and innovation.  No argument!  

Nadine Karp McHugh, president of the Association of National Advertisers’ SeeHer, and Jennifer Pelino, executive vice president-omnichannel media at IRI, shared a clever, data intense, research approach that determined sales lift across an array of brand powerhouses, based on the level of the ad’s GEM score for the portrayal of women and girls in a brand’s ads.  The results were conclusive in that the highest sales lifts were associated with the ads that had the highest GEM scores.  

IRI went one stage further and studied the programming environment carrying the ad for their GEM scores.  When both the brand’s ad and the programming carrying it had high GEM scores, the incremental lift was 93%.

In a “Winning Papers and Solutions” breakout session, two presentations offered terrific insights and challenged the research industry.  

An extensive comparative study examined the ability of the same ad to generate attention and keep attention on different devices: smart TVs, PCs, Tablets, and smart phones.  It was executed via GfK’s “ad fit optimizer” under the leadership of Senior Vice President Jon Brand who stressed that understanding what drives consumer’s attention, “is the number One challenge” in an environment of commercial avoidance that produces, “a sharp decay in engagement.”  

Mobile did relatively well against the other devices on the various attention and response measures.  However, the real value of the research was the clear ad creative attributes for each device that would help generate more attention.  No surprise, video on any device generated better ad attention and duration than display and positive emotional messages work across all devices.  Testing ads across all planned devices will clearly reap dividends.  

Little surprise that the cross-media measurement “challenge” came from Britain courtesy of Neil Eddleston, managing director of JC Decaux One World and Mike Follett, managing director of Lumen.  Their presentation was founded on the position that, ad viewability (so called “viewable impression” in the U.S.) is not a media currency but merely a pre-requisite to the ability by a consumer to actually view, notice or pay attention to a properly rendered ad.  In other words, they suggest it is essential for advertisers, their agencies, and the media sellers to trade on ads “viewed,” possibly along with dwell time.  As such any currency should not be based on, “maybe,” “could be” or “might be” seen (or heard) just because it was rendered on a device to specification.  

Their research using infrared eye-tracking compared advertising on mobile with digital out-of-home (DOOH) on their own and in combination based on attention or noticed.  No surprise, due to increased reach and the well-established media multiplier effect, the combination of the two platforms achieved the best communication (attention) effects notably when mobile is preceded by DOOH.  

Is “attention” the “truth” as a cross-media measurement metric being sought by the WFA in collaboration with the ANA and ISBA in the U.K.?  Although remarkably never mentioned during the Conference, the ARF’s, “Towards Better Media Decisions” is unequivocal on what constitutes the purest media audience measurement – Ad (or content) exposure.  

“Attention” the next measurement level up in the ARF model of effects should not be used due to the involvement of the creative message.  “This (attention) is the degree to which those exposed to the advertising are focused on it.  It is the first measurement level at which the effects of the medium are significantly confounded with the effects of the creative.”  

So, is ad/content “exposure” the pure common cross-media metric we are all looking for?  This ARF Conference wraps up today. 

1 comment about "The Future Of The Entertainment Sector Revealed At ARF Conference".
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  1. John Grono from GAP Research, September 23, 2020 at 5:23 p.m.

    Tony, thanks for the ARF summary.

    Did anyone ask Neil or Mike what their threshhold is (recommended/implemented) in their eye-tracking?   When we were setting up our OOH MOVE system it was a minimum of 200 milliseconds.

    While that seems a low threshold, the human brain can process what you see with amazing speed.   What we found was that below 200 milliseconds there was no cognition so there was no possible ad take-out.   We also found that once you went past 200 miiliseconds the dwell time was sufficient for ad take-out to happen.

    These thresholds are very important for mobile advertising as well.   For example, as people swipe through their feed and screens, mobiles with low latency can detect and ping the URL, which server-side can count as an ad-serve, yet the 'swiper' would have basically seen nothing.

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