If the shoe (doesn’t) fit: why advertisers need to embrace the evolution of streaming

Amazon’s understanding of consumer preferences is impressive – a principle that extends to its growing streaming service, Prime Video. As we kick off this year, Prime is introducing an ad-funded tier as part of a wider strategy to expand subscribers’ options (both new and existing) to access its content catalogue.

 

Amazon isn’t the only subscription video-on-demand (SVOD) service set to shake up its model, with Disney+ and Netflix also investing in the potential of ad-tiers as an additional tool to drive subscriptions.

 

With ad tiers, users get greater flexibility and control over how they interact with content. Those working to a budget can opt-in to cheaper deals and people willing to pay more can opt for a fully (or mostly) ad-free experience.

 

Zoom out further and we see that in a world defined by convenience, the ‘one size fits all’ model is being challenged… and advertisers need to respond.

 

No ‘one’ streamer

 

Who is a streamer? Ask your gut and it’s maybe city-dwelling twenty-somethings, or culture vulture millennials. Ask the data? Well, things get a little more complicated.

 

Older people are flocking to streaming services, according to Ofcom. Our own data at Samsung shows that 72% of Samsung Smart TVs are used to stream, at least in part. So maybe not everyone is a streamer, but the audience definitely stretches beyond just Gen Zers and millennials, making it a far more diverse group than often perceived.

 

Even within streamers, there’s differences in how they stream. At Samsung, we talk about streaming-only, light-linear, and heavy-linear viewers – and that’s just the streaming/linear divide on our TVs alone. So it’s clear that it’s not about ‘young people’ or ‘people with more disposable income’ or whatever tends to be thought about streamers. Put simply, streaming has become integrated into our habits and today, what’s needed from providers is flexible offerings that suit viewers’ diverse range of needs and use-cases.

 

No ‘one’ streaming service

 

And this is where things are really heating up. Amazon’s foray into an ad subscription tier is especially interesting given it has a free streaming service in FreeVee. But this isn’t overkill, it provides choice, something we’ve established consumers’ need.

 

Personally, I subscribe to Apple TV, pay extra to let my family use my Netflix account, watch FreeVee content and of course enjoy channels on Samsung TV Plus. Most people not only want but need these varied options for the different ways they want to connect with content.

 

All of the streamers are finding new ways to package their content and it makes some of our beloved industry acronyms redundant. Prime isn’t really SVOD, but it’s also not AVOD. Please, nobody try me with the all-encompassing (and therefore meaningless) Hybrid-VOD. It’s just something new.

 

Implementing ad-funded tiers into subscription frameworks is the first step to breaking down the barriers to entry, ensuring more audiences cross over into the world of streaming. In turn, this is expanding the opportunities for brands to forge relationships with the sought-after streaming consumers.

 

No ‘one’ ad format

 

It’s not just streamers and streaming services that benefit from acknowledging that many options are useful for modern viewers. Opening up the streaming airwaves means brands can branch out from the traditional 30-second linear spots and deliver their messaging to high-value, relevant audiences, regardless of their TV preferences.

 

Not only can addressable ads sit against streaming content – seen by audience members that brands know haven’t already been exposed to their linear ad – but brands can advertise across the whole TV.

 

Look at Samsung Ads’ Sponsored Row, which allows content owners to promote specific programmes with relevant audiences directly below the recommended row. It helps to improve engagement opportunities and beyond that, there are other smart screen homepage opportunities, game hub opportunities and more.

 

Amazon prides itself on staying up-to-date on the consumer zeitgeist. Its decision to introduce ad-funded tiers isn’t an attempt to keep up with Netflix and Disney+. It’s just accepting the reality that the ‘one size fits all’ mentality should be left in the past.

 

The new streaming landscape is a win, win, win. Streamers have the chance to engage with platforms in a way that suits them. Streaming services get to widen access to premium content and drive viewership. And advertisers can more flexibly invest in their long-term pursuit of cracking ‘hard-to-reach’ streaming audiences – win, win, win.

 

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By Antonia Faulkner

Head of marketing & analytics, Europe & APAC, Samsung Ads