Although the cost of an ad-free experience became affordable as streaming services proliferated, consumers still had to pay more as their must-watch content was spread across multiple providers.
On the other hand, life has returned to pre-pandemic mode, and consumers prefer going to theatres to watch blockbusters as the theatrical experience is irreplaceable.
As a result, the engagement rate for streaming media is declining, as the PQ Media report confirms.
The situation, in our opinion, will indeed present various challenges for advertiser and brands. Here are some:
Cannot attain the desired results as before:
As an impact of lowered streaming media engagement, the overall efficiency of campaigns will probably be affected.
Because when audiences are exposed frequently to the brand’s content, it will increase brand awareness, which can amplify the conversion rates. But when audience engagement with streaming media lowers, the reach and brand exposure will indeed decrease. As a result, advertisers will find it hard to capture the attention of their target market.
Already, the competition in streaming media is fierce. As the engagement is also lowering, brands will exert more effort to sustain the attention of the remaining audience. It will ramp up the competition more and put advertisers in a situation where they must put in extra effort to drive the results.
And, to combat this, advertisers will need to try creative approaches to make it engaging. Which may make the process complicated to establish the brands’ voice successfully in front of their target audiences.
Increases ad cost:
When reach and engagement decline, advertisers will be forced to pay high rates for ads. In other words, advertisers will have to spend more to reach the same number of audiences. Thus, it will make it less cost-effective for advertisers.
Needless to mention, CTV advertising is already expensive, and advertisers are under pressure to reap a better ROI. Hence, it may further worsen the situation.
Simply put, it is high time for advertisers to keep an eye on their results even more cautiously and plan campaigns accordingly. And, it is also important to re-evaluate their advertising strategy considering the slower growth of the ad-supported streaming media market.