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Ad Receptivity and the Ad-Supported OTT Video Viewer

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Ad Receptivity and the Ad-Supported OTT Video Viewer October 2018 Produced by IAB Video Center of Excellence Made Possible with the Financial Support of: Objectives and Methodology Objective: The study aimed to both size the audience and provide demographics of U.S. video streamers watching Ad- Supported Over-the-Top (ASV OTT) video. Once ASV OTT viewers were identified, a deep dive survey further explored the video viewer segments to gain insights into their behaviors, attitudes and usage in order to help better target the ASV OTT cohort. Methodology: Two online surveys were fielded among MARU/Matchbox’s Springboard America online panel (~250,000 U.S. members): 1. Omnibus study of 1,512 nationally representative U.S. 18+ sample to determine the profile of the Ad-Supported OTT Video Viewer; fielded 8/10/18. 2. Study among 1,223 consumers ages 18+ in the U.S., with age/gender quotas set to reflect viewership profiles from the omnibus study; fielded 9/25/18-9/26/18. 2 Definitions . Ad-Supported OTT Video Viewers (ASV OTT Viewers) are defined as those who watch video… Through a streaming service I watch for free and there are ads (e.g., YouTube, Pluto, Roku Channel, Crackle, Vevo, Xumo, etc.) Through an online-based cable TV provider (e.g., Sling TV, DirecTV Now) Through a streaming app that requires a cable/satellite/telco login (e.g., Discovery GO, FX app, WatchESPN, Xfinity, Spectrum, etc.) Through a streaming service I subscribe to for a monthly fee, and there are ads (e.g., Hulu with limited ads, CBS All Access with limited ads, etc.) . Free Ad-Supported OTT Video Viewers (Free ASV OTT Viewers), a subset of ASV OTT, are defined as those who watch video… Through a streaming service I watch for free and there are ads (e.g., YouTube, Pluto, Roku Channel, Crackle, Vevo, Xumo, etc.) . Subscription Video On Demand (SVOD) Viewers defined as those who watch video… Through a streaming service I subscribe to for a monthly fee, and there are no ads (e.g., Netflix, Amazon Prime, HBO Go/Now, Showtime App, etc.) . TV Viewers are defined as those who watch… ‘Regular’ (not cable) TV to access free local channels (e.g., ABC, CBS, NBC, FOX, etc.) using an antenna or ‘over the air’ Through my cable/satellite/telco provider (e.g., live TV, DVR, VOD) TV Only Viewers = those who only watch TV/Cable Heavy = those who watch TV/cable daily+ Light = those who watch TV/cable weekly or less 3 Key Takeaways 73% of adults 18+ who typically watch streaming OTT video say they watch ad-supported OTT video 45% of adults 18+ who typically watch streaming OTT video say they watch ad-supported OTT video most out of streaming videos Ad-Supported OTT Video Viewers (ASV OTT) are an INCREMENTAL audience: • ASV OTT viewers do NOT typically watch linear TV (ASV OTT viewers spend less time watching cable than SVOD OTT viewers)—they are an incremental reach. • Over half are cord cutters/shavers with over one-third citing ‘better content on streaming services’ as a reason. ASV OTT Viewers are a HIGH-VALUE audience: • Profile: Younger; with kids in household; skews male. • Similar to SVOD OTT viewers except that they skew more male. • Very different from TV only viewers: Younger; more male; diverse; with kids; higher income. ASV OTT Viewers are an ENGAGED audience: • Roughly 1 in 3 ASV OTT Viewers say that ads on free ASV OTT services are better than TV commercials. • About 1 in 3 say ASV OTT ads are more engaging, relevant and unique than TV commercials. 4 Key Takeaways ASV OTT Viewers watch a variety of platforms Over 2-in-5 ASV OTT Viewers are watching more ASV OTT video than they did a year ago. ASV OTT Viewers are receptive to ads: They are much more likely than SVOD OTT viewers to enjoy ads, find them useful, have higher engagement with them and to enjoy interacting with ads. More ASV OTT Viewers try new brands, are brand influencers and buy direct brands. Compared to SVOD OTT Viewers and TV Only Viewers, ASV OTT Viewers are more likely to follow Social Influencer stars and they spend more on subscription purchases (e.g., meal kits or contact lenses). 5 Why Does This Matter? ASV OTT viewers are a valuable audience who are similar in demographic to SVOD OTT viewers but reachable primarily through ASV. They are a more desirable audience than TV Only viewers. ASV OTT viewers can be more elusive to target than TV Only or SVOD OTT Viewers but can be found on ad-supported video OTT channels, where they are watching more ASV OTT than a year ago. Despite being the typical ad blocking demo (young, male), ASV OTT viewers are more receptive to advertising than either SVOD OTT or TV Only viewers. What’s more, many report that they enjoy interacting with ads. In fact, ASV OTT viewers think of ads on this platform as being better. ASV OTT viewers report that they are open to new brands, new ways of advertising and marketing and have a penchant for direct brands. This target is prime for direct brand messaging. 6 Meet the ASV OTT Viewer 7 73% of adults 18+ who typically watch streaming video say they watch ad-supported OTT video QS1_Services. How do you typically watch TV or streaming video on your TV? 'Video' may include TV shows, movies, news clips, music videos, online original video series, etc. Omnibus., n=900 8 45% of adults 18+ who typically watch streaming video say they watch ad-supported OTT video most out of streaming videos QS2_ServicesMost. And which of the following do you watch most often? Omnibus, n=900 9 Demographics Those who watch Ad-supported Video (ASV) OTT most skew: male; younger; diverse; and with kids U.S. 18+ GEN. POP. WATCH ASV OTT MOST GENDER FEMALE 49% MALE FEMALE 60% MALE 44% 36% 37% 33% AGE 18% 30% 18-34 35-54 55+ 18-34 35-54 55+ 10 Gender, Age, HH Income, Marital Status, Kids in HH Omnibus, n=1,512; floating by Platform Users. Watch ASV OTT Most n=388, Demographics Those who watch Ad-supported Video (ASV) OTT most skew: male; younger; diverse; and with kids U.S. 18+ GEN POP WATCH ASV OTT MOST H o u s e h o l d I n c o m e 28% 34% $75k+ MARITAL STATUS PARENTS Married Have children Married Have children in household in household 50% 41% 49% 51% Caucasian Caucasian 64% 58% ETHNICITY African-American African-American 12% 15% Hispanic Hispanic 16% 14% Asian/Other Asian/Other 8% 12% 11 Gender, Age, HH Income, Marital Status., Kids in HH Omnibus, n=1,512; Watch ASV OTT Most, n=388 Those who mostly watch ASV OTT Video most are similar to SVOD viewers except that they skew much more Male and are slightly more diverse • ASV OTT viewers are very different from TV only viewers: Younger, more male, diverse, with kids at home and higher income. U.S. Gen Pop Watch ASV Watch SVOD TV Only OTT Most OTT Most Viewers Male 49% 60% 46% 44% Female 51% 40% 54% 56% 18-34 30% 44% 42% 10% 35-54 33% 37% 36% 28% 55+ 36% 18% 21% 61% White/Caucasian 64% 58% 60% 72% Black/African American 12% 15% 11% 11% Hispanic 16% 14% 23% 11% Asian/Other 8% 12% 6% 7% $75K+ Income 28% 34% 34% 21% Married 50% 49% 51% 51% Kids in Household 41% 51% 51% 26% 12 Gender, Age, HH Income, Marital Status, Kids in HH Omnibus, n=1,512; floating by Platform Users. Watch ASV OTT Most n=388, Watch SVOD OTT Most n =512, TV Only Viewers n=566. OTT Video Services Typically Watched % Who Typically View OTT Video via Each Service Among U.S. Adult 18+ OTT Streamers and Among U.S. Adult 18+ OTT Streamers Who Watch ASV OTT Most US 18+ Gen Pop ASV OTT Most Viewer 62% 54% 48% 44% 43% 41% 42% 37% 34% 29% 25% 17% 15% 16% Ad-free Subscription Ad-supported Streaming app that Ad-supported Free Online-based cable TV Regular (not cable) TV Cable/Sat/Telco TV Service Subscription Service requires a Service provider (e.g., live TV, DVR, cable/sat/telco login VOD) (e.g., YouTube, Pluto, Roku (e.g., Sling TV, DirecTV Now) (e.g., ABC, CBS, NBC, FOX, etc.) (e.g., Netflix, Amazon Prime, HBO (e.g., Discovery GO, FX app, (e.g., Hulu with limited ads, CBS Channel, Crackle, Vevo, Xumo, etc.) using an antenna or ‘over the air’ Go/Now, Showtime App, etc.) All Access with limited ads, etc.) WatchESPN, Xfinity, Spectrum, etc.) 13 QS1_Services. How do you typically watch TV or streaming video on your TV? 'Video' may include TV shows, movies, news clips, music videos, online original video series, etc. Omnibus, n=1,512; Watch ASV OTT Most, n=388 TV and The ASV OTT Viewer 14 More than half of ASV OTT Viewers are cutting back on cable/ satellite/telco services due to cost More ASV OTT Viewers than SVOD OTT Viewers have recently cut/shaved cable/satellite/telco service Cost remains the top reason for cord cutting % Who Are Cord Cutters/Shavers "Cost” is the top reason for all groups 52% 47% SHAVED 29% 19% 26% 23% 28% 15% CUT 11% ASV OTT Viewers SVOD OTT Viewers TV Only Viewers QS7. Have you ever subscribed to a paid TV service (Basic cable, Digital cable, Telco or Satellite)? QS8. Have you recently cut back on your paid TV service (Basic cable, Digital cable, Telco or Satellite)? Base: Floating by Platform Users; ASV OTT n=589, SVOD n=332, TV Only n=302.
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