Extreme Reach: 2019-Q1 Video Benchmarks

Share of impressions by length in 2019-Q1 according to Extreme Reach:
1) 30s - 69%
2) 
15s  – 28%
3) 
60s – 3%
4) 
6s  – <1%

Share of impressions for 6s:
1) 2017-Q1 – 0.04%
2) 
2017-Q2 – 2%
3) 
2017-Q3 – 3%
4) 
2017-Q4 – 5%
5) 
2018-Q1 – 3%
6) 
2018-Q2 – 1%
7) 
2018-Q3 – 2%
8) 2018-Q4 – 1%
9) 2019-Q1 – <1%

Share of impressions by device (YoY change):
1) 
Connected TV - 49% (↑ 18%)
2) Mobile – 25% (↓ 8%)
3) Desktop  - 17% (↓ 7%)
4) Tablet  – 7% (↓ 4%)
5) Other  – 2% (↓ 1%)

Completion rate by device:
1) 
Connected TV – 97%
2) 
Tablet  – 89%
3) 
Desktop  –  81%
4) 
Mobile  – 81%



Average view time by length:

1) 30s  – 26s (87%)
2) 15s  – 12s (80%)

More #1: So Much For Conventional Wisdom, Study Finds Consumers Connecting Longer On Long-Form Connected TV Ads

More #2: Connected TV Ad Gains Are Mobile’s Loss

LiveRamp Buys Data Plus Math to Boost Targeted TV Ad Presence

Big News: LiveRamp has agreed to acquire Data Plus Math for $150M ($120M in cash + $30M in stock).  

What is Data Plus Math?
  Data Plus Math is a software and analytics company that helps advertisers attribute business outcomes to advertising spend.

Quote from Scott Howe – CEO @ LiveRamp:
“As an industry we’ve been talking for the past couple years about when is the turning point coming in television?”

Flashback #1: LiveRamp Adds Connected TV Integration, Posts 35% Rise in Revenue

Flashback #2: As Television Gets More Digital, TV Advertising Needs To Follow Suit

Key details for Data Plus Math:
1) Founded in 2016
2) 20 employees
3) ≈ $5M in annual revenue
4) 24-30X revenue multiple on the purchase price
5) $7.5M in capital raised over 2 funding rounds
6) The companies share 10 customers

Quote from Allison Metcalfe — GM of TV @ LiveRamp:
“In the new world you can say, ‘I’m going to pay you to get this many people to come to my website, or I’m going to pay you based on this sale metric that I care about.’ These are becoming secondary guarantees”

“What the network may offer to the buy-side is both a traditional Nielsen metric, but also a secondary guarantee based on outcomes as well. That’s very ground-breaking and new to the industry. The currency hasn’t changed for decades. This is a very new, revolutionary idea.”

Our take: This is a big win for the Data Plus Math team and the entire advanced video ecosystem.  Smart companies like LiveRamp are not willing to pay 24-30X multiples if a vertical isn’t hot.

Video:Data Plus Math’s LiveRamp Sale ‘Closes The Loop’

More #1: LiveRamp’s Latest Deal Shows How TV And Digital Are Becoming More Like Siblings Than Strangers

More #2: LiveRamp to acquire Data Plus Math to fuel outcome-based investment for TV

J.J. Abrams Bidding War Won By WarnerMedia as Bad Robot Nears $500M Partnership

The big deal: WarnerMedia and Bad Robot (J.J. Abrams company) have reportedly agreed to a deal worth $500M.

The deal covers:
1) 
Movies
2) Television shows
3) Video games
4) Consumer products
5) Music
6) Digital content

Bad Robot deals in 2019 dollars:
1) 
2006 – $80M
2) 
2019 – $500M

Recent talent deals:
1) 
Bad Robot (WarnerMedia) – $500M
2) 
Greg Berlanti (WarnerMedia) – $400M
3) 
Ryan Murphy (Netflix) – $300M
4) 
Shonda Rhimes (Netflix) – $100M

Quote from Bob Greenblatt 
– Chair @ WarnerMedia:
“Just because you increase the volume [of shows], you can’t increase the number of really talented people in the world that can produce these shows, so when they come along as a J.J. Abrams does once in every generation, you want to hold on to them…We hope to keep him in the family.

There’s a very competitive situation out there because the other great companies and streaming services also would like to have him,” 

More: Artist Shares Storyboards From J.J. Abrams’ Unmade Movie Superman: Flyby

Wall Street analysts forecast a major power shift in the streaming TV market, with Hulu and YouTube surging while others falter

Streaming pay-TV market share in 2022 according to UBS:
1) 
Hulu – 35%
2) 
YouTube TV – 21%
3) 
Sling TV – 14%
4) 
DirecTV Now – 14%
5) 
Cable OTT – 10%
6) 
Other – 5%
7) 
PlayStation Vue – 1%



Ruh-roh: 
Existing streaming customers stopped adding streaming services last year and are projected to be flat through 2024.

The average number of streaming services  per HH, according to Ampere Analysis:
1) 2015-Q3 – 1.7
2) 2016-Q3 – 2.3
3) 2017-Q3 – 2.8
4) 2018-Q3 – 2.8

Ideal price for streaming services according to Morning Consult:
1) 
With ads – $8-$12
2) 
Without ads – $10-$16


Cost to acquire a new customer for Netflix:
1) 
Domestic – $200
2) 
International – $60

Video: 
‘We needed to re-educate the market on Hulu’: The video streaming provider’s CMO explains why it needed a refresh

More #1: eMarketer – US Subscription Video Landscape 2019

More #2: CBS sees consumers taking as many as 10 OTT video subscriptions

More #3: How Digital TV Delivery Will Change How NBCUniversal Sells Ads For The 2028 Olympics

The NBA Wants You To Bet on Games That Never Happened

WTF: The NBA is working on a virtual sports-betting game called NBA Last 90 that lets you bet real money on fake games.

How it works: Bettors are dropped into the final 90 seconds of a “game” between two actual teams (Lakers vs. Celtics, etc.).  The rest of the game is a combination of other highlights from past Lakes/Celtics games.  This allows for an unlimited supply of games and betting 24/7/365.

Cash money: Fox is going to be the first network to take bets during games directly.

Quote from Jim Lanzone – CEO @ CBS Interactive:
“The floodgates are starting to open, not only for more gambling-focused content, but entirely new data products that appeal to people trying to gain an edge,”

Early estimates predict that sports betting will generate $3-$5B in additional revenue per year for media companies.

Video: New Sports Betting Legislation Opens Opportunities for Mobile

OpenAP and NCC Media partner to expand advanced advertising on TV

Big news #1: NCC Media is joining OpenAP to expand advanced TV advertising.

What this means: Advertisers will now be able to use OpenAP segments and then execute locally with NCC Media.

Big news #2: Comcast, Charter, and Cox will work together to offer addressable advertising against the network’s share (88% of total) of the ad inventory.

What this means: In the short term, this appears to be a competitor to other initiatives (Project OAR, etc.).  We previously wrote about the race to offer addressable advertising to both national and local inventory.

Big news #3: Project OAR is growing with the addition of Fox and several agency partners.

The players in Project OAR:
1) AMC Networks
2) AT&T
3) CBS
4) Comcast NBCUniversal
5) Dentsu Aegis (new)
6) Discovery
7) Disney
8) Fox (new)
9) Freewheel
10) GroupM (new)
11) Havas (new)
12) Hearst
13) Horizon Media (new)
14) Inscape
15) IPG’s Magna Global (new)
16) Omnicom Media Group (new)
17) Publicis Media (new)
18) Turner
19) Xandr
20) Vizio

Reminder: It is early in the game for advanced/addressable advertising.

National TV ad spend share by targeting type according to eMarketer:
1) Age/Gender — 95%
2) Advanced TV/Audience — ≈ 3% 
3) Addressable — 2%

Adoption for addressable TV:
1) Fully using — 15%
2) 
Experimenting or not using — 85%

Adoption for advanced TV:
1) 
Fully using — 17%
2) 
Experimenting or not using — 83%

Flashback: Who Sells What? NCC Media And Xandr Aim To Consolidate The Confusing Addressable TV Market  

Video: 
Comcast, Charter & Cox Want TV Industry To Unite For Addressable Ads


More #1: 
OpenAP’s New CEO: Collaboration Ain’t Easy, But The TV Industry Can Do It

More #2: Will Addressable Advertising Stave Off A Decline In Television Ad Spending?

More #3: As TV Broadcasters Make Their Pitch, Linear Is The Next Frontier

‘Something enormous’: Inside Walmart’s ambitious streaming video plans

Walmart is preparing an ad-supported streaming service with middle America as the target audience.

Wow: Walmart accounts for close to 50% of all TVs sold in the United States!

Retail → Advertising: Amazon, Target, and Walmart are all making major moves into the advertising space. In addition to a potential streaming service, Walmart is pursuing “shoppable ads” and extending its audience/customer data to the Vudu streaming platform.

Flashback: Walmart Plans Competitor to Amazon’s Video Marketplace

More #1: Walmart goes from big-box stores to the small screen with Vudu ad network

More #2: Walmart Bets on TV Shows for Families, Date Night in Media Push

More #3: Target is courting advertisers with first-party data

John Stankey’s challenge: Making AT&T’s $100 billion bet on Time Warner pay off

The big bet: AT&T is re-aligning WarnerMedia around the future of media consumption with a goal of 70M subscribers for its new streaming service.

The challenge: Getting Warner Brothers, Turner and HBO to work together.

Quote from John Stankey — CEO @ WarnerMedia:
“Media has moved into an environment where scale is essential… Somebody in the legacy media space will build a platform of scale and get to 70 million to 80 million subscribers. We’d like it to be us. If you keep the cultures separate, you’ll never get the benefits the three together bring.”

Projected pricing for WarnerMedia streaming service vs. current price for HBO Now:
1)
WarnerMedia — $15–18
2)
HBO Now — $15

Video: WarnerMedia CEO John Stankey on HBO, CNN, and company growth


More #1: AT&T Has Become a New Kind of Media Giant

More #2: AT&T Eyes $16- to $17-a-Month Streaming Service in Strategy Shift

More #3: AT&T’s Streaming Ambitions Hit a Snag: The Cost of HBO

Marketers Turn Up Podcast Advertising

Podcast advertising revenue by year (YoY growth) according to PwC:
1)
2015 — $106M
2)
2016 — $169M (↑ 60%)
3) 2017 — $314M (↑ 86%)
4) 2018 — $479M (↑ 53%)
5) 2019P — $679M (↑ 42%)
6) 2020P — $863M (↑ 27%)
7) 2021P — $1.0B (↑ 21%)


Share of advertising revenue by delivery mechanism:
1)
Edited-in — 51%
2)
Dynamically inserted — 49%


Share of advertising revenue by objective:
1)
Direct response — 52%
2)
Brand awareness — 38%
3)
Branded content — 10%


Share of advertising revenue by spot length:
1)
60s — 30%
2)
90s — 27%
3)
15s — 23%
4)
30s — 19%
5)
>90s — 1%


Top 5 podcast advertising categories:
1)
Direct-to-Consumer Retailers –22%
2)
Financial Services — 21%
3)
Business-to-Business — 14%
4)
Arts and Entertainment — 10%
5)
Telecommunications — 7%

Podcast listeners by year (YoY growth) according to eMarketer:
1)
2017–67.3M
2) 2018–72.7M (↑ 8%)
3) 2019–76.4M (↑ 5%)
4) 2020–78.9M (↑ 3%)


More #1: Investing in the Podcast Ecosystem in 2019

More #2: Spotify lands exclusive podcast deal with Barack and Michelle Obama

More #3: Podcast Wars: $100 Million Startup Luminary Launches Tuesday Without Reply All Or The Daily

Political Ad Spending Will Approach $10 Billion in 2020, New Forecast Predicts

Presidential year political ad spending by cycle according to GroupM (% growth):
1)
2012 — $4.3B
2)
2016 — $6.3B (↑ 46%)
3) 2020P — $9.9B (↑ 58%)

Midterm year political ad spending by cycle (% growth):
1)
2010 — $4.0B 
2)
2014 — $4.3B (↑ 8%)
3) 2018 — $8.7B (↑ 101%)


Flashback: Sinclair: Political To Come ‘Hand Over Fist’ In 2020

Quote from Steven Marks — EVP @ Sinclair Broadcast Group:
“Every other day there is somebody joining the race. It really bodes well for local broadcasters. There is going to be quite a robust fourth quarter [this year] and in 2020 we are not going to be able to get out of the way of the money. It’s going to be literally hand over fist.”

Compound annual growth rate between 2014–18:
1)
Political advertising — 15.50%
2)
All advertising — 6.25%


Quote from Kyle Roberts — CEO @ Advertising Analytics:
“Fundraising on the internet is bigger than ever, and candidates have more reach into low dollars than ever before, and it results in more cash in the system… Election campaigns increasingly are able to amass considerable sums from small donations made online by supporters.”

More #1: Hulu, Spotify Competing for Bigger Share of Political Ad Spending

More #2: Broadcasters forecast 2020 political advertising bonanza

More #3: The political playbook of advertising