Connected TV: Why strong standards are urgently needed

Consumers have made up their minds: interest in linear TV is declining, interest in paid content and multiple subscriptions is already maturing. Today, 78% of French consumers watch streaming TV content at least once a week. And we are the only ones in Europe who prefer to watch free streaming content (62%) rather than paid content (58%). The trend is still in its infancy, as 70% of SVOD consumers would choose a free, ad-supported package if they had the chance.

 

Why would they do so? Because the proliferation of paid content offers has led to a certain amount of fatigue: 74% of Europeans say they do not intend to increase their budget for paid content. This “subscription fatigue” can also be explained by the fact that free content is increasing in quality and originality, appealing in particular to younger people: the “millenials” who no longer watch, or hardly ever watch, linear television.

 

Advertisers are faced with a major opportunity here: connected television, or CTV, allows them to reach a strategic target, for budgets that are much lower than those for traditional television. Especially, since CTV users agree that the ads broadcast in this context seem to them less long, less numerous and less repetitive than those on linear television. That’s why the market is growing so fast: by 2024, AVoD advertising spending is expected to more than double worldwide to $56 billion.

Convincing advertisers with harmonised tools

So is it just a matter of pushing the CTV button to reach young, ad-receptive audiences at a fraction of the cost? We are not quite there yet. Because the market needs to improve its standards and, above all, become more homogenous.

 

This is not easy: firstly, because the terminals used to consume VTC (connected television, game consoles, telephones, computers, etc.) have very different configurations and functionalities, and therefore have varying technical requirements in terms of advertising integration. The ecosystem is currently working on the establishment of measurement and normalisation standards, which are essential to convince advertisers. The VAST 4.2 standard offers advanced tracking and verification support, but adoption of this standard is still very low. Server-side ad insertion (SSAI) seems even further away.

 

Another key issue is user targeting, whether it is centred on first party data or on contextual elements. To be useful on a large scale, these two approaches must be used in a complementary, not alternative, manner.

 

Finally, the management of user consent needs to be harmonised: how can it be obtained and transmitted to the various stakeholders along the value chain? Two approaches exist today. Either it is the manufacturers of the terminals (connected television sets, for example) who ask for this consent when the user configures his device for the first time. Or it is the consent management specialists who obtain it, at different phases of use. But not everything is smooth in this chain of transmission: these two approaches, insufficiently complementary, sometimes become redundant, creating gaps in the value chain.

 

The potential offered by VTC is considerable today: being able to have an affordable, customisable space that offers a secure environment for brands is every advertiser’s dream. But standards need to progress, to achieve rapid harmonisation. Otherwise, a fragmented landscape of “walled gardens” will take hold. We already know from experience that this is not the right solution.

This article was first published on Stratégies. Find the original article here.