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The Last Mass Medium?

Out-of-home is back as what advertisers surmise could be the last mass medium that is also cost-efficient.  The pandemic with its shut down and remote office periods deflated outdoor’s power as a mass medium but a new survey from The Harris Poll confirms that consumers will be on the roads this spring and summer, marked by a return to commuting and plans for summer vacation

Yet, even outdoor is having its own fragmentation due to the increase in digital boards that divide advertising reach by 6-8 advertisers sharing media space on the same board.  Digital out-of-home (DOOH) is also moving into Programmatic giving it advantages to counter this fragmentation.

The appeal programmatic DOOH ads is multi-faceted. First, they are impervious to ad blockers and dwelling in non-invasive environments.  Second—and perhaps more importantly—DOOH is a major beneficiary of the cookieless future due to its alternative means of audience targeting that is not executed on a one-to-one basis but rather one-to-many. Brands employing this technology can tap into fluctuating societal, cultural, and environmental trends in real-time, and reach consumers en masse with relevant ads as they navigate their daily journeys.

It also opens up new creative opportunities, great examples of which include when Renault bought OOH inventory to promote its latest electric car whenever air quality dropped below accepted levels, or when Flonase ran DOOH campaigns anytime pollen levels rose in target areas. Brands that adopt Programmatic DOOH have an opportunity to create meaningful, head-turning experiences that leave a marked impression on consumers. There is no doubt that this channel is emerging as a compelling disruptor to brands and advertisers looking to develop their presence during uncertain times.

Cord Cutting Continues

With the worlds of TV and digital gradually coming together, more and more consumers have chosen to unplug from traditional linear TV options and embrace online streaming—a move that’s fueled the Connected TV phenomenon. Then, as the pandemic gripped the world and forced people to spend more time at home, the media landscape was set perfectly for CTV adoption to soar to new heights, and now, what was once a “nice-to-have” programmatic channel is unequivocally a “need-to-have.”

Programmatic’s penetration of the CTV arena reached a massive 70% in 2021 and it is expected to surpass 78% by 2023. However, while there is undoubtedly momentum here, there are still some obstacles to further growth. Unlike, say, mobile app advertising, where the vast majority of inventory is available within just two operating systems—iOS and Android—the CTV space is infinitely more fragmented in terms of different devices and providers where an ad could be displayed. Think streaming sticks (Apple TV, Fire TV, Chromecast, Roku, Android TV), games consoles (PlayStation, Xbox), and Smart TV devices (Samsung, LG, and other manufacturers), each of which have distinct standards and advertising capabilities. In 2022 and beyond, programmatic CTV has huge potential, but to maximize campaign success, advertisers must carefully consider where they are serving their ads and which devices to embrace.

On a local market basis, maximizing quality inventory while achieving cost-effective reach of a target will continue to be challenging.  Especially when media buying qualifiers such as frequency and channel caps, dayparting and use of white lists become necessary to maximize the quality of CTV buys.

Targeting 2.0

With Chrome about to cancel third-party cookies, 2022 will be the make-or-break year for the development of new identifiers and technologies that can either reimagine the concept of tracking codes or replace them entirely. The advertising industry and its organizations must seize the opportunity to become more transparent with their audiences. Any new identity solutions must put consumers in the driving seat and empower them to control how, when, and where their data is used.

That said, there is no need to panic.  The end of targeted campaigns is not upon us. Programmatic advertising—even in the absence of many once-relied-upon persistent IDs—will continue to give media buyers access to publishers and placements, with contextual targeting likely re-emerging as an integral piece of the puzzle.

There is actually huge opportunity for savvy brands to deepen their relationships with consumers in ways cookie-based tactics never truly allowed. Recent research by Deloitte Digital exploring emotional-driven engagement revealed consumers prefer contextually sensitive brand experiences since they tap into their more immediate concerns, rather than over-relying on past behavior or browsing habits. By embracing the use of contextual data in programmatic campaigns, marketers can foster meaningful connections with consumers that inspire and frame the depth of brand loyalty and brand advocacy.

TV Most Influential

In a recent TVB study, 49% of respondents said TV was more important for awareness than all other media platforms combined. It was also tops by a wide margin in terms of influencing interest, visits to stores or websites, consideration and ultimately purchase.  TV initiates word of mouth, the study said, as well as helps ad recall in other media.

Even among those who do online searches, 89% said that TV ads influenced their search selections. Among young adults (18 to 34), 96% said TV influenced their searches.

90% of online shoppers said TV influenced their searches.

The study found that TV was the most influential for the categories of automotive, banking, furniture/bedding/carpet, legal, hospitals/urgent care/clinics, dentists/orthodontists, eye doctors/Lasik, QSR, in-store retail and online retail.

Audio Trends

Traditional radio listening flat into 2023—studies show time spent with digital audio is slightly higher than radio and that radio is at pre-pandemic listening levels as of Oct 2021.

YouTube is the most used streaming audio app —followed by Spotify and Pandora but Amazon is expected to surpass Pandora in listeners in 2022.

37% of U.S. households have smart speakers furthering the increase in streaming audio.

 90% of all podcasts are currently enjoyed at home.  Traditionally a mobile medium, the pandemic shifted podcast listening away from cars, offices, and gyms and into kitchens, living rooms, and bedrooms.  Millennials listen most to podcasts.

Breaking Down CTV

CTV (Connected TV)—Premium content streaming via internet connection through apps, either on a smart TV or through an OTT (over-the-top) device (fire stick, roku , gaming box etc.)

CTV “buys” are more like digital:

  • Guarantee impressions served to a specific defined audience in defined geography down to the zip code level
  • Specific programming, “channels”, and times are not available
  • Like digital, CTV is highly fragmented, especially in ad-supported channels like Pluto, YouTube and Tubi
  • Most of CTV is purchased programmatically (using automated technology that accesses data insights, third party audience data and algorithms to serve ads across aggregated content/publishers)

Non Skippable —viewers don’t have the option to skip or fast forward through commercials (doesn’t necessarily account for whether viewers are paying attention or not, similar to linear television)

CTV CPM’s significantly higher than linear TV

  • CTV cost-per-thousand pricing is two-three times the cost of linear broadcast and cable TV. The more complex the CTV audience targeting, the higher the CPM.

Roku Still #1

Roku users now make up a third of the US population, but despite this strong performance industry experts project growth for Roku will slow down over the next few years as the US market becomes more saturated. Looking ahead, Roku will hit 126.4 million monthly US users in 2025, while Amazon Fire TV will follow closely at 118.6 million users that year. While Roku has already crossed the 100 million users mark, Amazon Fire TV saw growth of 15.4% in 2021, reaching 97.0 million monthly active users. Amazon will surpass 100 million users this coming year.

So, while Roku remains the top CTV platform in the US, accounting for 51.7% of CTV users, Amazon Fire TV is much closer now with a penetration rate of nearly 45% among CTV users. Apple TV’s penetration is low compared with the rest, at only 13.1% of US CTV users.

2022 Challenges

Accelerated complexity and fractionalization of video and audio content is the #1 challenge
for advertisers in 2022.

Fractionalization challenges advertising’s reach—a growing number of options within each channel and many are non-addressable (Netflix, Prime, Disney+, Apple Music, Amazon, etc.).  But fortunately, TV/Video content consumption continues to grow as many players create exclusive content for individual channels—more and more streaming options (Peacock, Paramount+, Tubi, etc.) and luckily addressable media is on the increase.

While the gap is narrowing, time spent with live and recorded TV still outpaces time spent with digital video (viewing on computers/mobile devices, game consoles, connected TV’s and OTT devices).

Audio options also expanding…growth in podcast listening is fueling growth in addressable streaming audio audiences.

What Is Online Privacy?

Privacy is coming to the internet and cookies are going away. Many argue this is long overdue; those of us in the advertising industry are challenged by what happens next.  We don’t have much consensus on what online privacy means and what’s on the table conflicts fundamentally with competition.

Can we achieve the underlying economic aims of online advertising in a private way? Advertisers don’t necessarily want (or at least need) to know who you are as an individual. Advertisers don’t really want to know who you are – they want to show diaper ads to people who have babies, not to show them to people who don’t, and to have some sense of which ads drove half a million sales and which ads drove a million sales. Targeting ads per se doesn’t seem fundamentally evil, unless you think putting car ads in car magazines is also evil. But the internet became able to show car ads to people who read about cars yesterday, somewhere else – to target based on the user rather than the context. This is both the same and completely different.

The answer seems to be whether advertisers disclose whatever they’re doing and get consent. Sounds good but in practice we’ve discovered, ‘get consent’ means endless cookie pop-ups full of endless incomprehensible questions that no normal consumer should be expected to understand and just train consumers to click ‘stop bothering me’. Meanwhile, Apple’s on-device tracking doesn’t ask for permission, and opts you in by default, because, of course, Apple thinks that if it’s on the device it’s private. Perhaps ‘consent’ is not a complete solution after all.

But the bigger issue with consent is that it’s a walled garden, which takes me to a third question – competition. Most of the privacy proposals on the table are in absolute, direct conflict with most of the competition proposals on the table. If you can only analyze behavior within one site but not across many sites, companies that have a big site where people spend lots of time have better targeting information and make more money from advertising. If you can only track behavior across lots of different sites if you, do it ‘privately’ on the device or in the browser, then the companies that control the device or the browser have much more control over that advertising.

These are all unresolved questions, and the more questions you ask the less clear things can become. Apple clearly thinks that scanning for CSAM on the device is more private than the cloud, but a lot of other people think the opposite. You can see the same confusion in terms like ‘Facebook sells your data’ (which, of course, it doesn’t) or ‘surveillance capitalism’ – these are just attempts to avoid the discussion by reframing it and moving it to a place where we do know what we think, rather than engaging with the challenge and trying to work out an answer.  The problem is we can’t even agree on the questions so we can come up with the best answer to what exactly online privacy is.

Omnichannel Approach Promotes Deals

Fifty-one percent of shoppers prefer to receive their coupons on their smartphones. The number rises to 73% for millennials, 76% for parents and 81% for millennial parents. Sixty-one percent of consumers use a savings app from a grocery store, drugstore, mass merchant or supercenter once a month or more. The figure rises to 80% for millennials, 86% for parents and 90% for millennial parents.

Most shoppers rank saving money as their top priority, alongside convenience. Their decisions to activate coupons are less driven by media but more by value and ease of use. They want to save with both digital and paper coupons and therefore, brands must make them available to drive more sales.

As such, marketers must adopt an omnichannel approach to meet diverse customer preferences while dialing up specific channels based on the behaviors of their target audiences.

The search for deals and savings isn’t limited to retail and shopping. Forty-five percent of consumers use coupons, discounts or offers at least half the time when ordering from restaurants. This is particularly prevalent among millennials (61%), parents and millennial parents (67%).

While some consumers are still reluctant to dine at restaurants, 63% say they are comfortable with ordering carryout or delivery. Coupled with the sentiment to support local businesses — 65% of people say it’s important to support local restaurants — there are many opportunities for restaurants to attract diners by offering discounts and incentives through various channels.

In particular, restaurant booking apps speak to consumers’ desire to engage with brands via smartphones. Promoting discounts and deals on these channels is a strategy that restaurants should lean into in 2021 and beyond.