Linear or streaming: who will win the throne?

Published: June 05, 2023

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4
min read

Undeniably, with the wide adoption of streaming services by consumers, it has become super-popular in the space of entertainment. The huge level of interactivity, flexibility, and variety of choices it provides keep its hold strong among consumers.

However, as more people opted for streaming services, the price increased, and streaming companies began to offer less expensive ad-supported tiers gradually to effectively handle the situation.

With the addition of more free services and a boom in ad-supported programming, it is clear that users’ interest in subscribing to multiple services is not growing, and the consumption of free streaming services has drastically increased.

Here is the survey report of the Horowitz Research Division of M/A/R/C Research.

  • The percentage of the population subscribed to SVOD services has remained stable at 67% since 2019.
  • The population using over-the-top (OTT) services increased from 42% in 2019 to 69% in 2023.
  • Population using MVPD: drastically reduced.

The "State of Media, Entertainment, and Technology: Subscriptions 2023" report, published in March 2023,

Here are the report results:

  • 39% of consumers (the largest portion) subscribe only to subscription video services.
  • 22% of the population subscribes to an MVPD alone.
  • 30% combines the two,
  • 9% of the population pays for neither.

The user experience has evolved and increasingly aligns with traditional ad-supported linear programming as streaming has expanded and grown as a channel, an evolution that may benefit legacy providers more than streaming's relative newcomers.

It is apparent that the industry is at a crossroads right now, and it remains to be seen who will emerge victorious in this debate.

What does it mean for marketers?

After the pandemic, as the viewership of streaming increased, the powerful players in the streaming industry introduced ad supported tiers, formed new collaborations to help marketers effectively target their audiences, and offered something irresistible in order to attract customers to their platform.

However, while the ad costs on streaming platforms are already higher compared to other platforms, the competition in the space didn’t decrease as people’s love for streaming never seemed to fade.

However, a few months ago, some of the studies conducted around streaming media consumption gave disappointing results to marketers and industry leaders.

The Deloitte study results showed streaming TV taking a dip, with at least a third of the millennials planning to decrease the number of streaming services to which they were subscribed.

PQ Media research results: Ad-supported media engagement considerably fades.

Now, the above survey results show that the introduction of more ad-supported tiers in the streaming space enhances the scope of linear TV, as both provide the same kind of user experience.

It is well known that in the race for linear or streaming services, streaming services have outperformed linear TV in recent years, particularly because of the ad-free convenience they provide to users.

But now, the situation has been gradually changing with the ad-supported option.

So, to make the most of their streaming investments, brands and marketers need to tweak their strategies to effectively capture the audience's attention in a streaming environment.

  • Marketers must not miss the opportunity to leverage the information provided by ad-supported streaming services on user preferences and viewing habits to deliver relevant ads based on the context of the streaming content. By doing this, marketers can increase their chances of capturing their target audience's attention.
  • By exploring interactive ad formats like quizzes, polls, or even mini-games within the ad, marketers can enhance the viewers’ engagement with the ad. This way, they can cut through the crowd and increase the likelihood of users remembering a particular brand’s ad and ad interaction.
  • As streaming platforms typically have shorter ad formats, which is not the case with linear TV ads, marketers must focus on creating compelling and concise ad content to deliver the core message quickly. Though it seems challenging, by optimizing the visual creative for shorter attention spans, marketers can better connect with their audiences and drive traffic towards their brand.
  • Marketers must continuously analyse and monitor the ads performance to improve the effectiveness of the campaigns. Besides, they should be open to experimenting with different ad formats, and messaging strategies to identify the type of content that resonates well with their target segments and thus reap a better ROI.

Instead of whining over the recent survey results on streaming services, we believe it is high time for marketers to focus on designing compelling ads to do their best to get good results.

Moreover, it is also equally important for marketers to keep an eye on how both linear TV and streaming services are performing to plan their media mix accordingly, as linear channels have all the chances to take the lead at any time.

Author

Grace Wang

Grace is an advertising professional who keeps abreast of the latest and greatest in the marketing and advertising space. She is a traditionalist in lifestyle and modernist in her profession. Outside of marketing and advertising, she helps younger generation try and adapt traditional lifestyle for a healthy living.

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