Black Friday is still a couple days away, but for ad-supported streaming services and connected TV platforms, this holiday advertising season is already its biggest, longest and busiest one ever.
That’s good news for the fast-growing streaming landscape, which has already had a record year in both audience growth and marketing investment due to Covid-19. As this unusual (and extended) holiday shopping season continues apace, ad-supported streamers are capitalizing on a confluence of advantages—lengthy sales, retailers’ emphasis on online shopping and a need for precision—all helping buoy connected TV and streaming as a marketing vehicle for both direct-to-consumer brands and big-box retailers.
“Everything has changed in 2020, so why would this holiday season be any different?” said Alison Levin, Roku’s vp of global ad revenue and marketing solutions.
Streaming’s promising holiday advertising season comes after ad spend on these platforms was already on the rise. Connected TV and OTT ad spend grew 70% from the first quarter of 2020 to the third quarter, according to recent figures from Pixalate, a global ad fraud intelligence and marketing compliance platform.
Heading into fall, retailers that saw dents in sales from shutdowns and other Covid-19 disruptions are sensing an opportunity to make up lost revenue. Adobe is forecasting record holiday sales, and according to a joint survey from Roku and Harris Poll, consumers expect to spend an average of $885 total on holiday shopping, up 2.5% from last year.
Those same consumers are starting their holiday shopping early: Nearly two-thirds of Americans said that by Thanksgiving, they’d already be well underway, according to the survey. That has translated to extended promotional periods from retailers that began as early as October, when Amazon’s delayed Prime Day encouraged some extra-early holiday shopping and turned on the marketing spigot for streamers.
“Black Friday used to be this one big thing, and Cyber Monday was this one big thing, and it was kind of the kick-off of the season,” said Mark Rotblat, the chief revenue officer of Fox-owned, ad-supported streamer Tubi. “This year, Amazon Prime Day came as a part of the season, and then a lot of promotions have been spread out throughout the course of October and November. There is not this one point of time that it has been in the past.”
Those expanded marketing campaigns are increasingly centered on driving business through ecommerce channels instead of in-store sales. Per Roku and Harris, while three-quarters of consumers won’t head to physical stores on Black Friday, 40% of consumers do plan to shop online for deals that day. That’s where ad-supported TV gets another boost: OTT viewers are, on average, younger than linear TV viewers, and younger shoppers are typically more comfortable making online purchases.
“For retailers that have an ecommerce message or a retail message, or even just a message about what their brand means to an audience like our Hispanic audience, streaming has been a no-brainer,” said Natalia Borges, evp of marketing at ad-supported Spanish-language streamer Vix. “Where is your most captive audience that is young, that is spending, that is going to be ordering? That’s what we’re able to provide, audience-wise.”
Streaming services and platforms also benefit as marketers continue to face pressure to show measurable results with lead generation and sales outcomes. On Roku, there’s been a noticeable uptick in marketers’ interest in using interactive ad formats as part of marketing campaigns, Levin said.
“Brands are looking to use the television screen to start a transaction with a consumer, and connecting it to mobile from there, or connecting it to desktop from there,” Levin said. “Whether it’s a QR code or a sweepstakes where you enter in an email, they’re starting the transaction on the TV screen and pulling it through to other platforms. While the capability existed before, it wasn’t being leveraged in the way it’s being leveraged now.”
As Covid-19 restrictions begin again amid a flood of new cases, some marketers are looking to make last-minute tweaks and adjustments to their campaigns, which the streaming ecosystem offers. “The ability to turn on and off campaigns as necessary, the ability to run different promotions in different markets—being able to have flexibility in real time is attractive,” Levin said.
And while there’s a benefit around flexibility, those buyers who secured holiday ad inventory during the delayed upfronts season are best positioned to capitalize, as high demand has prompted a tightening in the video advertising marketplace.
“Those that jumped in and committed in the upfronts secured inventory in both television and OTT that is now [scarce],” Rotblat said. “Those advertisers that waited, and waited for more certainty on what the business looked like and what their advertising picture was, are now coming in and they’re finding that there is less inventory in the marketplace. There’s been somewhat of a scramble for some advertisers to place what they need for this season.”