Future of TV Briefing: Frequency management continues to be a challenge for streaming advertisers

• Streaming advertisers battle with some viewers being overexposed to advertisements whereas others are underexposed.
• There are methods for advertisers to extra strictly handle advert frequency, however they arrive with prices.
• Netflix and Disney+ might evince a shift in streamers’ willingness to handle frequency for advertisers.

A couple of years in the past, I felt I hit the frequency cap on articles written about streaming advertisers’ battle to handle how usually audiences have been uncovered to their advertisements. I used to be incorrect. While the difficulty has improved in accordance to company executives, balancing between overexposing and underexposing streaming audiences to advertisements continues to be a challenge.

“It’s getting better, but it’s still an issue,” stated Marcy Greenberger, evp and managing companion of built-in funding at UM Worldwide.

Often the difficulty is that particular person viewers are overexposed to seeing the identical advert too many occasions in a given week. Typically advertisers strive to restrict their video advertisements from being proven to the identical particular person to two to three exposures per week, although some model classes can prolong the vary to 4, stated Greenberger. However, there proceed to be conditions the place some viewers are served the advert greater than thrice that threshold.

“If you look at an average brand, their CTV frequency curve looks as bad, if not worse, than their linear [TV] frequency curve,” stated Mohammad Chughtai, world head of superior TV at MiQ, which focuses on managing programmatic shopping for for advertisers and companies. 

To that time, Chughtai shared the beneath graph that charts the weekly advert frequency for an undisclosed model’s marketing campaign throughout conventional TV and streaming through the use of MiQ’s knowledge on 43 million U.S. households. While the model’s streaming advertisements remained inside the typical frequency vary for 80% of viewers, the highest 20% of viewers — i.e. those that spend probably the most time streaming — noticed the advert greater than a dozen occasions in a week.

However, whereas some streaming audiences and streaming advertisers are coping with an overexposure difficulty, the alternative can also be a problem and evinced within the chart above: Advertisers battle to attain some viewers a ample quantity of occasions.

“We did a campaign with a goal of average frequency of three [ad exposures per week per individual viewer] across all the major publishers combined, and we could barely hit three,” stated an company govt.

That expertise befits a examine revealed by advert tech agency Innovid in 2021 that tracked 36 CTV advert campaigns and located 85% of households have been solely proven a given advert one or two occasions.

A major purpose for streaming promoting’s frequency management difficulty continues to be the challenge for advertisers to rein in exposures throughout disparate streaming companies. Individual streamers can cap advert exposures inside their companies, but when a particular person makes use of a number of ad-supported streamers every week and an advertiser is operating a marketing campaign throughout every service, that particular person is inclined to see the advert in extra. 

Advertisers can handle these cross-service exposures by way of a demand-side platform if they’re shopping for advertisements programmatically, however sometimes advertisers want to enlist a number of DSPs for their streaming campaigns. Additionally, managing streaming advert buys programmatically can power advertisers to make a trade-off.

“Some of the premium services, if you buy them either as [through a programmatic private marketplace] or through open exchange, you’re going to limit the amount of supply that you can access,” stated Greenberger.

Additionally, some streaming companies precise a tax on advertisers requesting stricter frequency caps. “Some will endeavor to charge more for more restrictive frequency caps, which could be prohibitive or incentivize lower spend from partners,” stated a second company govt. “But more and more, they’re willing to waive those fees. And hopefully that will be the case going forward as I think these lower frequency caps are the expectation, not the exception anymore.”

Never say by no means, although. In a additional potential signal of frequency management changing into the expectation, not the exception, within the streaming advert market, Netflix and Disney+ have every taken steps to restrict advert overexposures on their nascent ad-supported companies.

“Disney+ and Netflix both started off very aggressive in their sales approach, but both realized quickly they weren’t scaling as fast as expected. They were both very proactive in either turning away dollars or going to their advertisers that have already committed and saying, ‘We recommend or we need you to peel back some money so that we can make sure we’re delivering both your plans effectively and a positive user experience,’” stated the second company govt. “That’s not always the case with some of the more established platforms that really are just prioritizing revenue.”

The financial downturn might be an X think about how the frequency management difficulty performs out in 2023. 

On the one hand, there’s already a historical past of streaming advert sellers overpromising to safe offers and bypassing frequency caps to guarantee supply, in accordance to trade executives.

“If you [as an ad buyer] tell a publisher, ‘Here’s $50 million to run my ads,’ they don’t realize that these publishers are going to take your money. They’re never going to be like, ‘No, my frequency management isn’t great,’” stated a former streaming govt.

On the opposite hand, advertisers are wanting to eradicate advert spending waste, and managing streaming advert frequency can current low-hanging fruit. 

“Excessive frequency is wasteful, and insufficient frequency can can be ineffective,” stated Greenberger. “So I think it’s just as important as ever that both advertisers plan for it accordingly and publishers manage for it accordingly.”

What we’ve heard

“I just got a Samsung TV. It’s wild how much they push [the company’s free, ad-supported streaming TV service Samsung] TV Plus. They’re trying to make it unbelievably clear that you can cancel your cable subscription. They throw the local news at you, which is the number-one category. They throw movies at you, which is the number-two category. And they make it laborious to set up your cable box. So it’s like all of these things that just sort of slowly pushing people into it.”

— Entertainment govt

Hulu’s subsequent dwelling?

Following Disney’s quarterly earnings name final week, Disney CEO Bob Iger opened the door to doubtlessly promoting Hulu in an interview with CNBC. 

Whether Disney would really undergo with offloading the preeminent ad-supported streaming service after taking management of Hulu in 2019 and agreeing to purchase Comcast’s stake — and placing Hulu’s advert tech stack on the middle of Disney’s streaming advert enterprise — is a huge query. 

Another huge query: Who would purchase it? Well, I’ve three potential suitors in thoughts…

Numbers to know

113 million: Number of folks, on common, who have been watching the Super Bowl at any given minute in the course of the recreation.

2.4 million: Number of Disney+ subscribers that Disney’s flagship streamer misplaced within the last three months of 2022.

800,000: Number of Hulu subscribers that Disney’s different streaming service gained within the last three months of 2022.

12.4 million: Number of U.S. streaming subscribers that Starz proprietor Lionsgate had on the finish of the quarter of 2022.

17%: Year-over-year improve within the quantity of cash folks within the U.S. spent on streaming subscriptions in 2022.

60%: Year-over-year improve in U.S. households canceling their pay-TV subscriptions among the many 5 prime pay-TV suppliers.

What we’ve coated

Economic downturn ups the ante for main Super Bowl advertisers General Motors, AB InBev, Netflix:

• Super Bowl advertisements are being supplemented with digital campaigns that may be higher measured for enterprise impacts.
• Brands are additionally enlisting creators to enhance themselves by way of natural posts on social platforms.

Read extra concerning the stakes for Super Bowl advertisers right here.

Brands like Rakuten, Squarespace, Best Buy flip to in-house groups to create versatile, fast Super Bowl campaigns:

• Brands’ in-house groups are designed to be faster and extra agile than companies in managing Super Bowl campaigns.
• Marketers claimed that saving cash was not a major think about counting on their inner groups.

Read extra about Super Bowl advertisers’ in-house artistic groups right here.

How manufacturers and companies are prepping this 12 months’s hybrid Super Bowl conflict rooms:

• Dentsu Creative, Tinuiti, Modifly and Barstool Sports are among the many corporations that managed their Super Bowl promotional efforts remotely.
• Some corporations mixed in-person and distant conflict rooms.

Read extra about manufacturers’ Super Bowl conflict rooms right here.

On the eve of the Super Bowl, manufacturers a lot want promoting on CTV over conventional TV:

• 49% of 33 surveyed model professionals stated they aren’t spending any cash on TV advertisements this 12 months.
• 33% of respondents stated they’re not assured that TV drives advertising success.

Read extra about manufacturers’ TV spending right here.

What we’re studying

Discovery+’s future:
Warner Bros. Discovery nonetheless plans to mix HBO Max and Discovery+ into a single streaming service, however the firm will hold Discovery+ as a standalone choice for prospects struggling sticker shock, in accordance to The Wall Street Journal.

Peacock’s promise:
NBCUniversal’s streaming service has struggled to develop to rival Netflix, Disney+ and HBO Max, nevertheless it has been rising and will flip the nook this 12 months after having settled its govt ranks and with a slate of authentic reveals in retailer for 2023, in accordance to Vanity Fair.

Tubi’s worth:
As the ad-supported streaming conflict heats up, Fox has acquired provides to promote its free, ad-supported streamer Tubi for greater than $2 billion, in accordance to Bloomberg.

TikTook’s newest creator funds pitch:

TikTook is growing an choice for creators to cost folks cash to watch their movies in addition to an up to date model of its criticized Creator Fund that can goal to pay extra money to creators, in accordance to The Information.

TV’s sports activities measurement mess:
The newest complication in TV promoting’s measurement makeover is the flexibility of measurement suppliers — together with Nielsen — to reliably depend the quantity of folks tuning into stay sports activities on conventional TV and streaming, in accordance to Ad Age.