The Return Of ROI: Why Brands Should Rethink Earned Media Value

BY

With only a fraction of US digital ad budgets devoted to earned media, the ability to quantify and track EMV is causing some marketers to rethink their long-term strategies.

According to a 2022 report by the IAB, advertisers are spending more this year on digital advertising while reducing their spending on traditional media. Despite the budget rise, a recent survey by Kantar reports that only one in 10 marketers state that they have all of the data they need to judge the effectiveness of their marketing strategy. That means marketers will face more pressure to justify each dollar as businesses attempt to drive sales amid economic uncertainty. 

Added to that is the complexity of maintaining performance as the nation enters a period of uncertainty, even as the economy appears to be on an uptick.

Brands are increasing their ad spend and devoting the bulk of their marketing budgets to digital advertising. Yet only about 11 percent of their budgets are devoted to earned media.

While earned media lags behind traditional ad spend, its value is demonstrable.

Here’s how it worked for Rihanna:

  • From Saturday to Monday of the Super Bowl Weekend, Rihanna’s digital album sales increased by 301 percent.
  • “Pour It Up” (2012), a song she performed, saw a 1,387 percent increase in digital song sales and a 470 percent in on-demand audio streams.
  • “Where Have You Been” (2011) rose by a 1,272 percent boost in digital song sales and saw a 459 percent leap in on-demand audio streams.

Enter earned media value (EMV) measurement. When marketers can look at data connecting revenue to specific strategies, such as a tweet by an influencer, they can reallocate resources quickly, optimizing revenue opportunities.

Source: The IAB 2023 Outlook Survey

A Primer: How Earned Media Value Works

Earned media value (EMV) attaches a monetary value to the mentions or other publicity connected to a brand identity on earned media channels. This might include social media, public relations, influencer marketing and word-of-mouth. 

Earned media can help extend the value of more traditional forms of ad spending by helping brands penetrate untapped audiences, essentially for free. Fans can become brand ambassadors and deliver brand messaging with a click.

Earned media is often viewed as more credible than traditional ads, as audiences tend to trust social peers, readers, and influencers more than claims made in traditional campaigns. That human component can transform static ad campaigns into gateways to customer conversion when ads accompany a persuasive influencer’s content. 

Yet measuring EMV can be difficult due to the complexity of simultaneously tracking consumer behaviors and brand mentions. Since 2017, a.network has helped over 3,000 companies use their product, Social Index, to reliably measure earned media value (EMV) and campaign ROI.

Social Index 3.0 leverages the use of machine learning-powered algorithms to analyze vast proprietary and public data to help brands understand their customers and the brand’s power in the marketplace.

Users can integrate the Earned Media Values API with their existing analytics or data reporting suite to gain continual access to fresh EMV data.

According to Ayzenberg Chief Media Officer Vincent Juarez, Social Index provides marketers with the most comprehensive benchmarks for tracking earned media values (EMVs). As a result, Ayzenberg’s marketing and data science team is constantly monitoring the social media landscape to identify new and emerging platforms that matter most to marketers.

“Most platforms provide robust analytics in terms of video views, time spent, followers, likes, comments, and shares, among other metrics,” stated Juarez, at the launch of the latest iteration of Social Index. “Filling the void and providing marketers with earned media or advertising value equivalents (AVEs) for platforms like TikTok provides a foundation for testing, learning and optimizing future content efforts. It will also help standardize benchmarks to compare against other platforms.”

Here Come The Zoomers: 16 To 24-Year-Olds Are Always Connected And Streaming

BY

A recent report by GWI shows that today’s 16 to 24-year-olds are a lot like The Golden Girls: they spend hours on the couch watching TV and gossiping with their besties. That’s good news for savvy marketers willing to craft a context-aware marketing strategy.

Digital Is The Waking Life: Gen Z Spends Most Of Their Free Time Connected

Digital spaces are now where Gen Z spends most of their free time. According to GWI, Gen Z Americans spend almost three hours daily on social media, more than any other demographic group in the US. They also spend an hour and 23 minutes gaming and an hour and 34 minutes streaming online TV. That’s in addition to the hour and 28 minutes spent watching traditional, linear television.

The Second Screen Echo Effect

Gen Z is not just always connected—they also usually interact with multiple devices simultaneously. While that isn’t a surprise if you’ve been near a teenager in the last five years or so, what is new is the explosion of content choices and mobile tools. Consumers have multiple devices and opportunities to shop without getting off the couch or picking up a laptop. Mobile phone features that allow consumers to shop TV scenes or authenticate in-game purchases instantly from an app mean marketers have numerous opportunities to drive Gen Z consumers towards engagement—or away from it.

The same ad, out of context and on repeat, can deaden viewer interest.

Knowing that Gen Z people are likely connected to multiple content experiences and interacting with friends on social at the same time, brand marketers should be mindful of the echo effect. A good ad campaign is like a great TikTok video—engaging, informative, or amusing, and appears at the right time—based on what the viewer is interested in at that moment. When there’s an echo of something great—like a beat from a sound system—it’s danceable and a pleasure to experience. But ads that are irrelevant and track consumers from device to device are the wrong kind of echo—persistent and slightly creepy. That’s something users never want to see or hear again.

What This Means For Marketers

Digital spaces are now “home” for Gen Z. Online connections are almost always on or nearby. That makes it easier for marketers to find Gen Z consumers, but it also means they are likely already inundated with ads. Because they are always connected, they may see the same ads on repeat. Too many ads appearing on something always on and rarely out of sight may feel like an invasion of personal space. That means relevance is important, as is context.

For Gen Z, context matters a lot. While this demographic reports skipping ads more than other age groups, they are most influenced to make a purchase when viewing ads on TikTok, according to a recent YPulse report. This makes sense, as TikTok adoption has grown by over 40% since 2020, according to the GWI report. Gen Z consumers also use the internet 9% less this year to find information. There may be a reason for that: the rise of social search.

According to the report:

“TikTok is spearheading this shift in finding information online. The appeal of TikTok is real people recounting their real experiences instead of a search engine offering up hundreds of links that may get you the answer you’re looking for.”

That makes the social ads and TikTok-based campaigns especially powerful when they deliver information that can be found easily in a search.

Overall, the study found that Gen Z consumers are more likely to make a purchase based on viewing ads on social media and YouTube than on cable TV, for example.

Learn more by downloading the report.

New IAB Report: Ad Spend Will Rise Unevenly In 2023

BY

As advertisers reevaluate their budgets and their new priorities in the face of potentially ongoing inflation, they are still growing their ad spend. A new report by the IAB reveals that while advertisers will increase their spend in 2023, the growth will be focused on a few key areas.

Where advertisers will be spending the most

Next year’s overall ad spend growth will drop meaningfully from 2022’s nine percent rise in ad spend over 2021, estimated to reach only 5.9 percent. Advertisers’ biggest increase in spending will focus on four key segments. B2B ad spend will rise by 20.8 percent, travel by 20.6 percent, restaurants/beer/liquor/wine by 17.1 percent and financial services by 11.1 percent.  Not surprisingly, these are among the business sectors most vulnerable to inflation, making the competition for consumer dollars more intense. The report states that other sectors will face only single-digit growth. Digital channels will see positive ad spend growth, with CTV seeing the highest level, at 14.4 percent, while spending on traditional channels will decline. 

Advertisers will focus on customer acquisition and brand equity in 2023

Sixty-one percent of consumers will focus on customer acquisition in their 2023 marketing strategy and ad spend, with brand equity (43 percent) and improving the efficiency of their media efficiency (35 percent). According to the report, between 52-55 percent of advertisers will focus on measurement, marketing mix and modeling (MMM), as well as the use of 1st party data, and investment in creators in 2023. Yet that may change: Sixty-three percent of ad buyers stated that they anticipate changing their media plans more frequently in 2023 than they did in 2022—at least once per month. 

Retail media networks and the metaverse take center stage

The IAB report reveals that sixty-one percent of ad buyers have invested or will invest in retail media networks (RMN) advertising, and investment in 2023 will rise by 28.4 percent. Key areas of advertisers’ ad investment include onsite owned and operated, (91 percent), aggregated marketplaces (82 percent), retailer-owned (75 percent), and e-commerce owned (64 percent). 

The report also showed that 56 percent of ad buyers have invested or will invest in metaverse advertising/marketing, with many focused on building brand awareness (52 percent), engaging existing customers (48 percent), and reaching hard-to-find audiences (42 percent).

Read the entire report here

1. Rugabear, Christopher. How inflation spread across different sectors, making it harder to tame. https://www.pbs.org/newshour/economy/how-inflation-spread-across-different-sectors-making-it-harder-to-tame. October 2022. Accessed November 2022.

Report: Free Ad-Supported Channels On The Rise; Consumers Actually Don’t Mind Ads After All

BY

Findings from Hub’s new “TV Advertising: Fact vs. Fiction” report reveal that consumers love their streaming content enough to stay tuned through—and even occasionally enjoy—ads that punctuate their content experiences.

FAST Channels Like Pluto TV, TubiTV And Others Are Winning SVOD Subscribers’ Attention 

Hub’s report shows a 10 percent increase in consumers using free, ad-supported streaming TV (FAST) channels like Paramount’s Pluto TV. Currently, 55% of consumers report that they get at least some of their video content this way. The rise of FAST channels isn’t due to a lack of paid ad-free alternatives, or even “free” alternatives included with many consumers’ basic internet service. FAST channels may offer consumers the kind of neatly segmented thematic content that doesn’t require fiddling with a queue or relying on an algorithm for suggestions or hunting for options by name. FAST channels are often arranged by theme and provide channels dedicated to single niche-but-popular shows, like Pluto TV’s Midsomer Murders and Narcos channels. Last year, Pluto TV, with 64 million monthly users, managed to top $1 billion in ad revenue. This was a feat that underscores advertisers’ willingness to place their bets on cord-cutters and prestige network subscribers are heading to free alternatives to access content that includes their ads. 

But why are FAST channels so appealing to consumers who are now awash in content choices and channels offering a range of ad-free paid experiences? The Hub report shows that 56% of consumers would rather watch ads and pay $4-$5 less per month to enjoy streaming content, but consumer interest may be driven by more than a desire to save a few dollars on their monthly budget.

First, there’s the element of content choice. Take children’s programming. Pluto TV has one of the only free channel dedicated exclusively to kid-friendly movies out of the 82 channels focused on kids’ programming that previously appeared on TV or platforms like YouTube. With consumers cutting costs due to the specter of inflation, an always-on channel featuring long-play kid’s content can be an enticing alternative to paid services. 

FAST And Paid SVOD With Ads Can Coexist—And Marketers Should Take Note

FAST channels also serve as an enhancement for SVOD services, allowing consumers to prune their subscriptions and keep the ones that deliver the most value or that provide content they can’t find on their favorite FAST channel. For example, 70 percent of FAST channel Xumo’s viewers use streaming services exclusively for video content, with 80 percent of these subscribing to Hulu and 77 percent to Netflix.

According to Amanda Garcia, Senior Director of Partnerships at Paramount+ in a recent report produced by Comcast, “As customers find more ways to watch the content they love across a mix of services, FAST channels have become a key part of our media mix for acquisition and awareness, as well as targeted campaigns to super-serve key audiences.” That’s important, as consumer willingness to stay engaged with paid streaming services is now becoming tenuous due to inflation concerns—and budget-minded viewers are now canceling services at meaningful rates. Even at the height of the pandemic, when millions of Americans were home with more time to stream, consumers were prone to prune their subscriptions in search of better deals or better experiences.

Between July 2020 and February 2021, the number of TV viewers saying they had added a new SVOD service grew from 28 percent to 44 percent, but the share of consumers stating that they canceled a service rose from 18 percent to 25 percent during the same period.

That means consumers’ attention can go either way—more towards FAST channels when SVOD content feels stale (or costs become prohibitive) or back to paid SVOD when engaging original content draws them back.

Consumers Don’t Mind Ads, Just Make Them Worthwhile

The big takeaway here is that ads are not the problem when it comes to consumer engagement and satisfaction. The Hub report states that in its survey, subscribers to the ad-supported tiers of streaming services are, for the most part, “equally likely to feel they get “excellent” or “good” value from the service as those who subscribe to the ad-free versions.” In addition, subscribers to Discovery+ and Paramount+ with ads are “actually five points more likely than ad-free subscribers to feel those services offer excellent or good value.”

According to the Hub report, viewers of content on an ad-supported streaming platform reported distinct differences in their enjoyment of their viewing experience based on the relevance of the ads they remembered. For viewers who remembered ads relevant to their interests, 69 percent said they enjoyed the entire experience of watching programming. For those who didn’t see relevant ads, only 48 percent reported enjoying their experience. Consumers are also paying attention to ads on paid services. The report states that two streamers, Discovery+ and Hulu, led in the amount of attention their users paid to ads during commercial breaks (8-10 on a 0-10 scale).

“Flashback to the late 2000s: take the rapid success of ad-free streaming services like Netflix, add in the gradual erosion of traditional pay TV subscribers, and many industry experts began to predict that ad-supported TV would go the way of the dinosaur,” said Peter Fondulas, principal at Hub and co-author of the study.

“It turns out the issue consumers had with ad-supported platforms was not the fact that they included ads at all, but how the ads were delivered. With reasonable ad loads, more relevant targeting, and a quid-pro-quo agreement (watch ads, pay less), the industry seems finally to have an answer to the question that has dogged it for years: how to get consumers to accept TV advertising.”

Nielsen: Underspending In 50% Of Media Plans Jeopardizing Max ROI

BY

About half of marketers aren’t spending enough in a channel to get maximum return on investment (ROI), according to Nielsen’s inaugural ROI Report. The report identifies the factors that influence a brand’s ROI, how to measure these metrics with precision, as well as strategies for improving them so that campaigns are set up to secure as much value as possible.

If marketing teams committed the ideal amount of resources, their ROI could surge 50 percent, the report says. To understand how advertisers should allocate budgets, Nielsen analyzed its database of nearly 150,000 observations of marketing ROI and database of client-supplied media plans. Here’s what it found:

  • Media spend needs to be between 1 percent and 9 percent of revenue to stay competitive
  • The median brand reinvests 3.8 percent of revenues into media
  • Overspending isn’t as problematic as underspending 
  • Over half of global display and digital video campaigns are underspending

To take the guesswork out of understanding the impact of new media, Nielsen conducted over 1,000 studies on podcast advertising, branded content and influencer marketing. The study found:

  • New media can drive over 70 percent aided brand recall after ad exposure
  • Podcast ads drive familiarity and affinity gains
  • Influencer and brand marketing also drive big familiarity and affinity gains

Nielsen’s 2022 study of 15 brands and 82 digital campaigns in the US showed there’s a very strong relationship between target reach and campaign ROI. For the analysis, Nielsen sourced in-flight target reach metrics from its Digital Ad Ratings and its outcome metrics from Nielsen Attribution, which determines ROI at the impression level. When combining these measurements on a consistent set of campaigns, one clear takeaway emerged: Campaigns with strong target reach delivered better sales outcomes.

The firm’s research also revealed that only 63 percent of ads across desktop and mobile are on-target for age and gender in the US–which means that in the channels with the most exhaustive data coverage and quality, about 40 percent of ad spend doesn’t hit the mark.

View the full report here.

Advertising Leaders Announce Plans To Expand Ad Net Zero Initiative Globally

BY

​​Ad Net Zero—the initiative launched by the Advertising Association, the ISBA and the IPA in the UK aimed at reducing the carbon impact of advertising—will make its way to major markets worldwide, advertising leaders announced at the Cannes Lions Festival.

Global trade bodies including the ANA, 4A’s and the IAB, the WFA, European and global agency associations, EACA and Voxcomm, and the IAA will help the world’s largest agency holding companies—including Dentsu International, Havas, Interpublic Group, Omnicom, Publicis Groupe and WPP, Unilever, Google, Meta and Sky—establish plans to roll out Ad Net Zero in major ad markets with an immediate focus on the US and the EU. Serving as a roadmap, the UK program will help these companies develop market-specific solutions to reducing their ads’ carbon footprint.

The top 20 advertising markets—which account for 89 percent of the global advertising industry’s $594.322 billion spend— will be the focus of the program after the US and EU are addressed.

Launched in 2020, Ad Net Zero includes a five-point action plan that pledges to reduce the carbon emissions from UK advertising operations to net zero by 2030 and to leverage advertising to accelerate consumers’ switch to more sustainable products and services. It also includes the AdGreen carbon calculator, which helps measure and reduce emissions from advertising production.

Unilever has committed to reducing emissions to zero within its own operations by 2030 and to net zero across its value chain by 2039, with the first priority being to reduce emissions in line with the 1.5°C ambition of the Paris Agreement, according to Aline Santos, Unilever chief brand officer, and chief equity, diversity, and inclusion officer.

Ad Net Zero will provide updates on its progress at Cannes Lions each summer and its global summit each November. The next update will be presented at Ad Net Zero’s global summit, which will take place online on November 9 and 10, alongside this year’s 27th United Nations Climate Change Conference.

Ad Revenues Will Grow By 9% In 2022 To $816 Billion

BY

Global advertising growth in 2022 will reach 9.2 percent, or $816 billion—lower than the previously forecast 12 percent, revealed Magna, citing an economic slowdown and growing restrictions to data-driven targeting of digital ads.

“Magna was always expecting the global advertising market to slow down significantly in 2022 following the unprecedented levels of growth observed in 2021 (global +23 percent, US +26 percent) caused by a once-in-a-lifetime “planetary alignment” of factors: the V-shaped economic recovery and the marketing consequences of post-COVID lifestyles,” said the firm’s June 2022 forecast.

Nevertheless, a 9 percent increase this year would remain above pre-COVID growth rates—the average increase between 2015 and 2019 was 7 percent.

Magna anticipates North America to grow the most at 11 percent to a new high of $326 billion—40 percent of the global advertising market. This growth is marginally less than Magna’s prior forecasts for this year of 12.6 percent in March and 11.5 percent in December. Magna decreased its growth forecasts for Q2 to Q4 2022 as a result of the economic slowdown, though this has been somewhat offset by the market’s unexpectedly strong performance in Q1 where it grew by 14 percent and by the greater forecast for political spending of 51 percent. 

Cross-platform video advertising will grow by 8 percent to reach $89 billion while national linear TV’s decrease of 4 percent will be offset by the growth of long-form advertising-based video on demand (22 percent) and short-form pure players (19 percent) in addition to local TV’s record political spend. At the same time, cross-platform audio advertising—including broadcast radio, audio streaming and podcasting—will rise by 5.7 percent to $16.8 billion as cross-platform publishing ad sales fall by 3 percent to $16.2 billion.

One year ahead of previous expectations, out-of-home sales will grow beyond its 2019 pre-COVID high to $8.5 billion. Direct mail will also benefit from political campaigns and revenues will increase by 2.6 percent to reach $17.6 billion.

Following the decrease from Q3 2021 (44 percent year-over-year) to Q4 2021 (19 percent), pure play digital media advertising sales—i.e., search and social media—increased by 16 percent YOY to $42.5 billion in Q1 2022. Social media sales, on the other hand, curbed to an 8 percent increase in Q1 compared to its 38 percent growth in 2021—due primarily to Apple’s updated privacy restrictions. 

Search advertising remained high in the quarter at 24 percent as interest from advertisers shifts from social media to search in light of Apple’s changes. Still, in 2022, pure play digital advertising sales will grow by 14 percent to $195 billion. Search will lead performance at 18 percent to reach $116.7 billion. 

Social media will grow to $67 billion at an 11 percent increase—a downgrade from Magna’s previously forecast 18 percent. Magna cites client saturation, audience saturation and targeting restrictions but the 2022 acceleration is to be expected after social media advertising experienced a 36 percent increase in 2021.

Most industry verticals are expected to stabilize or increase ad spend this year, according to Magna. Travel, entertainment, betting and technology are expected to grow the most while automotive, consumer packaged goods (CPG) and fast-moving consumer goods (FMCG) budgets may be under pressure due to supply chain and cost issues. 

The economic slowdown will start affecting ad markets in Q2 and Q3 and Magna forecasts lower growth over the Q2 to Q4 2022 period, as well as throughout 2023. 

OOH Up 40.5% In Q1 2022—Largest Quarterly Increase In Medium’s History

BY

According to the Out of Home Advertising Association of America’s (OAAA) latest figures, out of home (OOH) advertising revenue jumped 40.5 percent in Q1 2022 compared to the previous year, accounting for $1.8 billion. That marks the largest quarterly increase in the medium’s history.

These first-quarter figures show that OOH is already outpacing the same period in 2019 and that it’s on track to reach or exceed pre-pandemic spending in 2022, according to Anna Bager, president and chief executive of OAAA.

The digital OOH format led total OOH growth with a 57 percent increase over Q1 2021. The billboard category increased double digits while the transit, street furniture and place-based categories all grew triple digits, signaling a strong COVID recovery.  

Led by financial and media and advertising, eight of the top ten product industry categories increased double digits. The public transportation, hotels and resorts industry category surged 58 percent, reflecting a consumer return to pre-pandemic behavior.

As noted below, emerging product categories also helped OOH succeed when compared to Q1 2021:

  • Cannabis spend increased 31 percent 
  • Political spend increased 113 percent (and 90 percent over the last midterm election cycle in Q1 2018)
  • Sports betting spend increased 131 percent
  • FinTech spend increased 22x

OAAA found that the top 10 advertisers in Q1 ranked in order of OOH spending were: Apple, Capital One, McDonald’s, Netflix, HBO, American Express, Amazon, AT&T, Verizon and Universal Pictures. 

Eighty-seven of the top 100 OOH advertisers increased their OOH spend from Q1 2021, and 47 of them more than doubled their spend. Advertisers on this list who didn’t spend in Q1 2021 included: Cirque Du Soleil, Credit Karma, Grayscale Bitcoin Trust, Molson, Monday.com, The New York Times, Not Milk, Peacock, Turner, UiPath, United Artists Pictures, VRBO and William Hill.

And thirty-one of the top 100 OOH spenders were technology or direct-to-consumer brands including these top ten brands according to spend: Apple, Netflix, Amazon, AT&T, Verizon, T-Mobile, ClickUp, Expensify, William Hill and BetMGM.

Global CTV Impressions Outpace Mobile, Accounting For Nearly Half Of Video Impressions

BY

Connected TV (CTV) surpassed mobile as the channel with the greatest share of global video impressions, with 46 percent of all video impressions, up from 40 percent in 2020. Meanwhile, mobile dropped from 43 percent to 39 percent, a sign that consumers keep flocking to streaming devices to get their content.

That’s according to Innovid’s 10th annual Global Benchmarks report, which uncovers CTV’s critical role in the converged TV landscape and outlines deeper measurement and optimization tactics marketers can use to improve their CTV strategies as advertisers shift their spend to the channel. 

In its report, Innovid explains three main findings, including:

  • As CTV takes center stage, plan for streaming dominance.
  • Advanced creative outperforms at engaging audiences.
  • CTV reach and frequency have room to scale.

As CTV Takes Center Stage, Plan For Streaming Dominance

As restrictions eased and the world opened back up in 2021, consumers continued their pandemic-induced obsession with streaming. And as they flocked to CTV.

In 2021, as CTV comprised the largest share of video impressions across all devices, CTV ad spend in the US reached $14.4 billion. And while global video experienced year-over-year (YOY) growth across all devices, CTV earned the highest increase at 47 percent—more than twice the rate of mobile (16 percent) and desktop (14 percent). 

Needless to say, CTV is no longer in its experimental or emerging stage. It’s an integral pillar in the marketing landscape and offers consumers a premium viewing environment coupled with data-informed targeting and captivating ad formats.

CTV outpaced mobile and PC’s growth to secure its position as the medium with the highest impression volume globally considering that more time spent watching CTV meant less time spent watching linear. In 2021 in the US, linear TV declined and is projected to continue that trajectory according to eMarketer. The pandemic also accelerated the rate at which cord-cutters replaced pay TV with streaming. 

According to Innovid’s research, linear and digital viewing are expected to be roughly equal by 2023, so marketers should embrace converged viewing across linear, CTV and digital. 

Innovid also found that every vertical increased its video contribution to CTV ads in 2021. The five leading verticals allocated more than 50 percent of video impression share to CTV. These figures were:

  • Travel, 63 percent 
  • Auto, 60 percent
  • QSR, 58 percent
  • CPG, 52 percent
  • Retail, 51 percent

Programmatic: The Rising Star

As convergence accelerates and brands demand more speed and flexibility, programmatic video advertising is on the rise. According to Innovid, slightly less than 33 percent of CTV impressions were served programmatically in 2021. Programmatic and social buying gained ground as broadcast native publishers lost it. And according to eMarketer, CTV will soon account for more than 20 percent of total programmatic video ad spending for the first time. 

CTV impression share by publisher type in 2021 was as follows:

  • Broadcast, 54 percent (down from 61 percent in 2020)
  • Programmatic, 30 percent (up from 26 percent in 2020)
  • Social, 13 percent (up from 10 percent in 2020)
  • Other, 2 percent (up from 1 percent in 2020)
  • Digital,1 percent (unchanged from 2020)

Advanced Creative Outperforms At Engaging Audiences

As consumers increasingly expect personalization and relevancy from advertising on digital platforms, advanced video creative—including dynamic and interactive formats—has allowed marketers to respond while also delivering higher performance through engagement as well as incremental time earned.

According to Innovid, here’s what engagement rates by device and video format look like in 2021:

Mobile

  • Dynamic video, 0.7 percent
  • Interactive video, 0.9 percent

PC

  • Dynamic video 0.5 percent
  • Interactive video, 1.3 percent

CTV

  • Interactive (non-choice), 0.5 percent
  • Interactive (choice), 23.7 percent
  • Interactive (total), 5.4 percent

Interactive CTV Grabs Top Billing With Engagement, Video Completion Rate And Time Earned

Marketers have more opportunities to monetize through interactive video ad formats. Interactive video creative provides more engagement than dynamic video across mobile and PC. And interactive CTV creative does far better than interactive mobile and PC, at 5.4 percent overall.

Interactive CTV’s performance stands out, in part, due to its ability to drive earned time with consumers. This translates to more opportunities for brand awareness and conversion. Advertisers who engage advanced creative have achieved an additional 47 seconds of time earned in 2021: that’s 11 seconds higher than 2020, according to Innovid. Interactive CTV led the charge by producing an incremental 72 seconds of time earned between brands and potential buyers.

Engagement rates, video completion rates (VCR) and time earned by video ad format included:

  • Dynamic video achieved 0.5 percent engagement, 72.9 percent VCR and 28.9 seconds earned.
  • Interactive video on mobile and PC achieved 1 percent engagement, 62.4 percent VCR and 34.8 seconds earned.
  • Interactive video on CTV achieved 5.4 percent engagement, 94.7 percent VCR and 72.3 seconds earned.

QR Codes Drive Interactive CTV Growth

Quick response (QR) code usage skyrocketed in 2021 given its touch-free, easy-to-use functionality. At the same time, CTV experienced similar growth with the largest activity coming from QR codes, which drive consumers to landing pages with detailed product information and opportunities for conversion. According to Innovid, QR codes have seen impressive engagement, with a scan click rate of 0.02 percent. While low in comparison to display metrics, this incremental engagement reflects high intent and follow-through on the part of the audience.

Here, shorter ads are best at capturing consumers. Across all devices, videos 30 seconds or less produced stronger completion rates of 80 percent or more when compared to longer-form videos, which saw completion rates of 67 and 77 percent. Last year, marketers utilized shorter formats’ successful completion rates as more than 95 percent of all video ads were 30 seconds or shorter. 

CTV Reach And Frequency Have Room To Scale

CTV campaigns in the US reached on average 9 percent of the more than 95 million households with CTV that Innovid can reach. Despite a surge in advertiser CTV adoption, 58 percent of campaigns included 19 million or fewer impressions and reached a mere 3 percent of households on average—representing an opportunity to increase reach.

Here’s what household reach based on impression volume looked like in 2021:

  • Over 100 million, 36 percent
  • 40-99 million, 18 percent
  • 20-39 million, 9 percent
  • Less than 19 million, 3 percent

CTV Frequency Isn’t Maxed Out

CTV’s average frequency of 4.1 exposures shows it’s possible that marketers have greater leeway for reaching new households and can shift investment into CTV without risking oversaturation. But Innovid notes that frequency can be problematic if left unchecked so it’s best for marketers to maintain a holistic household view to understand and manage over-exposure.

On average, only 8 percent of campaigns had a high frequency of over 10 exposures, while 67 percent had a low frequency of one to two exposures, and 25 percent had a medium frequency of three to nine exposures.

Best Practices

Innovid concludes the report with three CTV advertising best practices: 

  1. Plan for streaming dominance. Mobile is giving way to CTV, linear is catching up and streaming remains part of a cast of players. Real-time actionable intelligence is key to maximizing the whole and driving favorable business outcomes.
  2. Enhance engagement with advanced creative. Think beyond awareness and make video work across the funnel through data-driven formats that incite action with geo-targeted relevance and QR codes.
  3. Maximize reach while managing frequency. Gain a unified view of reach and frequency across the converged media landscape by adopting an always-on cross-platform measurement.

The Monumental Opportunity In Video Ad Measurement

BY

Ad measurement is key to proving a strategy is driving business impact, getting C-suite buy-in and optimizing strategies. Yet no more than half of US advertisers are satisfied with their campaign measurement across media types, according to an April 2021 Advertiser Perceptions survey. And only 38 percent are satisfied with their digital video measurement solutions.

A new eMarketer report explores the state of ad measurement, focusing on opportunities and challenges in the video space, including why advertisers are reassessing currencies to measure performance and how video ad measurement is expected to change through 2022 as the industry approaches a cross-screen and cross-platform solution.

The report’s three key findings include: 

  • Video ad measurement is a mess. Third-party identifiers are on their way out, which means greater challenges ahead for digital video measurement. Additionally, the industry is without a Media Rating Council-accredited currency as annual upfronts approach.
  • Video ad measurement is evolving. Advertisers stopped settling for siloed insights into campaign performance across video channels. Instead, they’re employing new directives that are helping facilitate cross-screen, cross-platform measurement by addressing challenges concerning data quality, compatibility and accessibility.
  • Video advertisers need to engage with the measurement problem. Though measurement is complicated, letting agencies, networks, measurement firms and ad tech platforms do the dirty work won’t benefit advertisers in the long run.

This year’s ad measurement discussion would be best addressed through the lens of video. With the 2022 upfronts coming up, there’s plenty of competition in the video ad measurement arena.

According to eMarketer’s 2022 forecast, US advertisers will spend just shy of $346 billion on media. Formats across linear TV and digital video—including connected TV (CTV)—will account for roughly 42 percent of total ad spending at $144.55 billion. 

But without a standardized system of measurement that connects the dots across mass and one-to-one advertising in online and offline ecosystems, it’ll be difficult to effectively allocate video budgets that align with changing consumer behavior.

According to an October 2021 Advertiser Perceptions survey, US advertisers ranked video as the most valuable tool for achieving advertising goals. As eMarketer notes, advertisers won’t stop investing in video while the industry works through the measurement challenge; video buyers and sellers will instead have to collaborate to face video ad campaigns this year, conquering ad measurement obstacles along the way. 

Before the industry can achieve cross-screen, cross-platform currencies (ie: those which allow for a fixed amount of inventory to be purchased in advance), that can facilitate holistic views of video investment, ad performance and campaign attribution, a few issues must be addressed. Until recently, it didn’t seem practical to adopt an alternative to Nielsen’s Gross Rating Point (GRP). Now, as eMarketer points out, there’s an array of alternative currencies.

For a transaction to occur, there must be a currency in place. For example, if a network doesn’t reach its forecasted viewership numbers, more ads are run at no extra cost in order to “make good” on the initial agreement. Measurement comes into play because an ad’s value is partially determined by how many consumers it reaches. Take billboards for example—those in high-traffic areas tend to be more expensive than those in low-traffic areas. Other than reach and frequency, the value determination can become subjective.

To constitute a measurement solution as currency-grade, VideoAmp chief measurability officer Josh Chasin cites two requirements: transparent and justifiable data-based methodology and that the output is perceived by the buyer and seller as fair, objective and as accurate as possible. 

On the other hand, television ad measurement data is typically sourced either from people or from machines. People-based panels are comprised of households and individuals whose viewership data is willingly offered. 

These panels come with their own set of challenges—for one, they’re regularly plagued by compliance issues and two, they’re often too small to correctly measure across all entertainment sources. Also, many advertisers activate against very specific and usually small audience segments. For these reasons, adequate measurement should be based on more than just panels.

Machines, on the other hand, include devices like smart TVs and set-top boxes that can generate massive amounts of second-by-second viewership data. And while big data regularly supplies the type of scale required to support analysis of smaller audiences, it comes with its own set of problems. For example, it must be cleaned and calibrated in order to correct errors, mitigate biases and secure accurate representation.

According to eMarketer, any holistic and useful measurement solution will draw from a combination of big data and panels. But data sources aren’t all advertisers have to go off of. Even given the exact same inputs, two measurement providers could reach two different conclusions. Each vendor uses a unique methodology, solutions for glitches in the data and models to apply to the broader population.

In designing and deploying holistic video ad measurement systems that can serve as a currency, measurement partners face several barriers, including:

  • Convoluted data infrastructures that make it difficult to unify disparate data sets
  • Chaos in identity – i.e., the “connective tissue” of ad measurement – resolution
  • Adaptability to the future of privacy compliance and new, disruptive formats and technologies such as the metaverse

According to eMarketer, there’s a seemingly endless supply of newly released or upcoming measurement solutions, which shows the magnitude of the current ad measurement opportunity.

There are two major cross-platform contenders on the third-party front. The first is Nielsen’s Nielsen ONE, which is set to launch in Q4 2022. The first operating version of this solution, Nielsen ONE Alpha, is in testing as of December 2021. The second is Comscore’s Comscore Everywhere product suite, which is rolling out in phases throughout 2022.

Other solutions can be seen also in linear TV’s move away from ad measurement based on programs to ad measurement based on the actual ad. The industry is also shifting toward outcomes-based measurement. While it’s important to know how many people were exposed to a campaign to contextualize any ensuing lift in brand affinity or sales, lift—not campaign exposure—is what advertisers are chasing in their media investment. 

One thing eMarketer is sure of is that the industry won’t be relying solely on Nielsen’s GRP in time for this year’s upfronts, where it estimates that US advertisers will spend $20.57 billion on linear TV alone. Networks are currently working with partners on in-house currency initiatives that are designed to streamline cross-screen, cross-platform measurement for all properties owned and operated by a single system.