Video is video, no matter what device it is viewed on or how it is delivered to that screen.
Viewers don’t make a distinction between traditional linear TV and digital when consuming premium video content, and the advertising industry must follow their lead and stop treating TV and digital as two separate entities if they want to successfully engage their audiences.
Despite the everyday business of linear TV and digital video still occurring in silos – with extensive fragmentation in execution and measurement – the gap between ad models for linear TV and digital video is closing. The industry is getting closer to integration, with media buyers combining linear and digital video budgets, and sellers offering an increasing number of converged sales options.
Unification in premium video is gradually becoming a reality. The FreeWheel Video Monetisation Report for the first quarter of 2017 revealed that, across both Europe and the US, digital video consumption and monetisation are progressively sharing the qualities that traditionally define linear television.
A closer look at the report’s findings illustrates how digital video and linear television advertising in Europe look more similar than ever before:
Viewing returns to the living room
As digital video consumption grows – with UK adults expected to watch almost an hour of digital video a day this year – European viewers are demonstrating a preference for devices that allow premium video content to be delivered directly to the TV screen, such as over-the-top (OTT) and set-top-box video-on-demand (STB VOD). This indicates the TV set is the screen of choice for engaging with premium video at home regardless of whether it is linear or digital.
Although mobile devices – smartphones and tablets – account for the largest share of video ad views due to their portable and functional nature, OTT and STB VOD devices are rapidly catching up with desktop, which is experiencing a steep decline in premium video ad views. This trend is even more pronounced in the US where OTT and STB VOD devices’ share of views has already overtaken desktop.
There are multiple benefits to the advertiser of TV-friendly living room devices, not least that viewers in this environment have a higher ad load tolerance. They are also more engaged – a Channel 4 study reveals ads on broadcaster VOD platforms command attention levels three and a half times higher than YouTube ads. Finally, ads served in a protected OTT or STB VOD environment have guaranteed viewability and are shielded from fraud in a similar way to traditional linear TV advertising.
Live streaming mirrors live TV
Monetisation of live video content via digital ad insertion is one key way digital is mirroring linear TV advertising. Although live video ad views still only account for 4% of all European premium video ad views – compared with 24% in the US – live ad views grew 117% year-on-year, indicating live streaming will be a key monetisation channel for the future.
As in the US, the trend for live streaming of digital video content in Europe is being driven by sports, with the live stream for 2016’s Wimbledon championship receiving 1.9 million requests – a figure that is likely to be vastly exceeded during this year’s event.
User experience takes precedence
Viewers have high expectations of the premium video content experience – needing it to at least meet, or ideally exceed the traditional linear TV experience. European broadcasters, who have always been careful to achieve a balance between driving monetisation and maintaining the user experience, are putting the viewer at the top of their priority lists as they expand their digital footprint across platforms.
Providing a TV-quality experience with digital video includes limiting ad load for viewers who are new to a platform, and only increasing it once a certain amount of content has been consumed. Broadcasters are also filling standard length ad breaks with many short ads rather than fewer long ads to prevent saturation.
Although the media trading process is increasingly automated, with almost a quarter of European transactions conducted through programmatic channels, broadcasters are keen to ensure this does not negatively impact the viewer experience or brand safety.
Boundaries within premium video are dissolving and the point when we refer to linear and digital as a single entity is not so far away. As we move towards global unification in premium video, the arrival of digital video in the living room, its increased focus on live content, and its emphasis on user experience, all show digital is really not that different to linear. Video is video after all.
By Thomas Bremond, managing director international at FreeWheel
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