Tag Archives: tv

From Linear TV to OTT and Connected TV Advertising in Asia

 

Moritz_Color_Small (1)
Moritz Wuttke, SVP Commercial, TV Solutions, IPONWEB

Global ad tech company IPONWEB (the super smart guys who built most of the programmatic infrastructure the industry relies on today) has set up a TV Solutions division to capitalise on the opportunities in the rapidly-growing digital TV sector. PwC predicts that one-third of the more than $200 billion global TV market will be traded programmatically by 2021. OTT and CTV (among other acronyms) are a huge focus in the entertainment industry right now, and where the biggest VC bets are being made, from Netflix to Hotstar. Digital in Asia took time to chat to Moritz Wuttke – newly appointed to lead the IPONWEB TV solutions division in the region – about all things Video, OTT and TV in APAC.

Digital in Asia: First off, WTF is OTT?!

Moritz Wuttke: OTT joins the long list of seemingly ubiquitous three-letter acronyms prevalent in digital media. Coming under the ‘advanced TV’ umbrella, it refers to video content that is streamed over the internet without the need for a paid-for cable or satellite subscription – it is delivered ‘over the top’ (OTT) of the traditional closed TV structure.

Content is viewed on any device connected to the internet – smartphones, tablets and laptops, as well as connected TV (or CTV to reinforce the acronym point).

Internet-based TV is now part of daily life for many people and the increasing consumption of internet video content on mobile devices is further driving this trend.
Consequently, the convergence of the digital media and television industries is now an ever-present fact that broadcasters and content providers must take into account.

DIA: Why is TV over the internet important for broadcasters?

MW: Traditionally, broadcasters were the masters of what people viewed and when they did so; the digital age has, of course, turned this on its head. Today’s YouTube and Netflix ethos sees users create vast swathes of free video content that anyone online can watch. Meanwhile, people expect to view what they want, at a time to suit them on the device that is to hand at that moment.

The increasing uptake of streamed video, paid and free, is tipping the balance back again. Broadcasters have developed additional platforms to attract and entertain their audiences, as well as offer them viewing flexibility, whether that is accessing programmes via catch-up or on-demand or binge-watching their favourite shows.

TV over the internet provides commercial broadcasters with additional advertising channels, and with that, new sources of revenue, while programmatic technology enables media trading to be fast efficient and, in some markets, more targeted.

DIA: Why does TV have such an ongoing appeal for advertisers, and do you see this changing?

MW: TV has always appealed to advertisers as the most cost-effective way to reach the mass market. While the broadcast media trading industry is seeing unprecedented changes, the inherent advantages offered by OTT television help the transition.

The various YouTube and Facebook ad placement scandals have shone a spotlight on the need for brand safety – and how difficult it can be to orchestrate in the digital arena. Broadcast TV available over the internet however lets advertisers control where their budget is spent so that it is non-damaging.

At the same time, it is also effective thanks to high-quality audiences and ads that can’t be skipped or fast-forwarded. This has resulted in strong growth of OTT advertising, particularly in the US market where Magna Global estimates that OTT grew 40% to $2 billion in 2018.

Addressable TV raises the bar still further, allowing different ads to be shown to different people, depending on their profile. Advertisers only need to spend where they want the ad to be seen, driving return on investment without the wastage that is typically found in broad-spectrum ad placement. In the UK, Sky leads the addressable TV space, reaching more than 40% of all households.

DIA: What types of brands or verticals are investing in advanced TV advertising, and why?

MW: Direct to consumer, or DTC, brands by their very nature will flock to advanced TV advertising. This will include addressable TV on linear (real-time) TV, where the audience is targeted with ads most relevant to them, and OTT advertising with its pre-roll and mid-roll options as well as relevant ad placement.

Advanced TV advertising is ideal for brands wanting to reach very distinct audiences, whether by geography, behaviour or demography. SMEs may want focus on the very specific locations in which they operate, while a brand that is available nationwide will have a large catchment area but may only be relevant to a particular audience (an air conditioning supplier is most likely to appeal to homeowners and new house-buyers for example.)

At the other end of the scale, TV advertising is now a reality for luxury brands, for whom ‘mass appeal’ has never been an issue. Luxury car-maker McLaren launched its first-ever TV advertising campaign via addressable TV because addressable advertising enabled it to target the right niche audience and deliver ROI.

DIA: How fast is internet TV being adopted in Asia?

MW: In China the majority of TV content is delivered OTT because of the high internet bandwidth available (more than 2.1billion devices are IP connected and can receive video content), while Thailand’s 4G rollout allows good quality internet TV via mobile screens. Overall, 16.3% of Asia Pacific internet users are current OTT subscribers, with show strong growth forecast over the next few years. This is underpinned by investment in the region by a number of large OTT players; we’ve seen the launch of HBO Go Asia and HOOQ, an OTT streaming solution backed by large content providers and local contributors including SingTel.

This shift to OTT services also reflects the ‘mobile first’ preference of consumers; at the end of 2018, more than 61% of webpage views in Asia were on mobile (compared to a global average of 48.2%).

DIA: Why is the shift to OTT happening now?

MW: Television has always held mass appeal – to audiences and therefore to advertisers. What we are witnessing now is the power of TV being made available over wireless networks (i.e. mobile phones and robust home internet connections). As hardware, software and connectivity continue to improve, audiences are increasingly able and willing to watch TV content online.

But it’s not without its significant challenges. Aligning and measuring TV audiences over different channels, non-integrated platforms and transparency are all issues on which IPONWEB is focused, with the goal of balancing investment in OTT with subsequent revenues.

There is certainly both appetite and talent to drive innovation in the television market – and the pace of change is fast, with Amazon and Netflix adding highly attractive content to make the space even more dynamic. Watch this space.

TV and Video Ads Converging Slowly as OTT Continues to Grow

Rashmi Paul
Rashmi Paul, Commercial Director, APAC, FreeWheel

We’ve all seen the huge rise of interest in programmatic over the past few years – what lies ahead for this technology?

It has taken a number of years for media buying to adopt automated ways of transacting in the region. This is mainly due to this being a more conservative part of the world, where change is not always welcomed, and which still relies on more traditional marketing methods. What lies ahead is a deeper adoption of automation, which will not be limited to standard display or video advertising, but will also include other media too, such as outdoor ads.

As money has always been invested in TV, the shift to digital and then from digital to basic IO has been a lot slower here than it has been in Europe, for example. What’s next for FreeWheel is to use the experience we’ve gained in other parts of the world to help the smoother adoption of automation in this market.

What are your thoughts on the growth of digital advertising in APAC?

Obviously, when it comes to digital growth, the most significant development has been in mobile, which has a massive market share. In certain parts of the region, consumers have on average two to three mobile phones per person. And as APAC is made up of a number of developing mass markets with large populations, it will only continue to grow. Broadcasters are also changing their strategies and moving inventory to digital from traditional TV.

How does the video advertising market in APAC differ to other regions?

The APAC region is very different from the rest of the world, as it contains a number of global markets – each of which has its own complexities and compliances for marketing. Each market has different, local factors that need to be considered. We also have to consider local language requirements, as some might only run campaigns in the local language, whereas others might prefer a mix with English.

Will we see TV and video continuing on their path of convergence?

Yes, I believe this convergence will continue. Traditionally, we spoke to agencies and digital buyers to try and get digital video inventory. Now media buyers are transacting across TV and video.  Our aim is to get broadcasters to think about how they trade and bring the two forms of media together, and we want to see this happen on a large scale in the APAC region. Customers who have had success with digital need to start seeing their linear offering in the same way that they view their OTT offering.

Interaction 2017: Group M Global Digital Forecasts

Each year GroupM publishes its overview and speculations on the state of digital marketing and its implications for advertisers. This year’s report – Interaction 2017  predicts that in 2017 digital’s share of ad investment in the developing world will at last have caught up with the developed world, to around 33%.

10 countries have already witnessed digital overtake TV, with a further five expected in 2017, two from APAC; France, Germany, Ireland, Hong Kong and Taiwan.

Interaction 2017

In 2017 it’s challenging to discriminate digital marketing from all marketing. Consumers barely separate their digital and analog lives; little media is published in only analog form and enterprises infuse digital processes into every aspect of their organisations.

However, it’s probably true to say that marketing strategy and marketing services remain more siloed than consumer behaviour, and equally true that marketing and sales organisations remain more separated than they should be given the collapse of the purchase funnel.

Google killed the TV star?

What if Google invested in eye tracking technology free on every TV?

They could do it in partnership with TV manufacturers, and under the auspices of measuring smart TV (read YouTube viewing on TV).

How quickly would this disrupt the TV advertising industry by exposing the TV GRP. People just aren’t watching commercials, we would conclusively discover.

The clear winner in the budget switch that ensues, must surely be Digital channels. And Google the biggest beneficiary.

Now we’re no Google fans here at DIA, mainly because of the conflicting positions they take in the industry on buying, selling, delivery and measurement – yes that’s right, if you use DoubleClick or Google Analytics you trust the same people who deliver your advertising to tell you whether it works or not. Similar conflict for publishers and marketers. But Google has to be admired for the work they have done in simplifying and driving our industry forward.

Investing in a system that could bring down TV might just be the simplest and smartest move it could ever make. And the best for our industry.

Could Google kill the TV star?