Streaming is poised to continue its exponential growth in the coming years, but advertisers have so far lagged behind; Americans currently spend up to 47% of their total viewing hours on streaming, but even by 2024, PwC estimates that U.S. advertisers will still be spending just 8% of all ad dollars on the medium. (In other words, just $5.6 billion of the $71.6 billion TV spend market.)
Signaling perhaps the largest hurdle towards a robust streaming advertising ecosystem is the lack of people who agree that advertisers have the data and tools required to effectively run campaigns on streaming platforms, with 39% of buyers and 70% of sellers report feeling confident in the medium’s current measurement abilities.
Conviva CEO Keith Zubchevich believes that within the next two years streaming advertising will “start seeing meaningful value increases” as media buyers’, sellers’ and consumers’ opinions begin to align, but acknowledges that there is a delay as the streaming ecosystem continues to evolve.
“A lot of the lag will be on the ability to learn a new business model,” he adds, likening the adoption and strengthening of streaming advertising to companies’ gradual embrace of the digital world in the past two decades: first testing the waters with a dotcom entity, then developing an app, before eventually reaching a “tipping point” where digital-first planning has become the norm.
But until that tipping point is reached, “You’ll end up in a marketplace that’s a little disjointed,” he says.
Media buyers and sellers may come to a consensus on some issues in the coming years, but for now, there’s still a long road ahead to close the largest gaps. Almost 80% of media sellers believe that measuring campaign effectiveness is harder on connected TV than other video platforms and 70% feel streaming ad servers are too limited to deliver advanced measurement, while only 19% and 26% of buyers agree, respectively.
Only 8% of buyers surveyed reported feeling that streaming content includes context that makes for a brand-safe environment, the report found.
“With streaming, there is an opportunity to provide high-quality creative to consumers, but we need to evaluate how and when we reach them,” says Scott McDonald, president and CEO of the Advertising Research Foundation, noting that concerns over privacy and scalability may mean it’s time to look beyond one-to-one targeting and “think about how we can align ads with the content that viewers enjoy and trust.”
The data for this report was gathered through research of two consumer and media buyer and seller sample groups by Dynata from February to April 2021, with additional insights from Conviva’s Stream Sensor technology that is embedded in more than 3 billion video streaming applications.
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