Leaving money on the table
S08E05: Game of Streams (Leaving money on the table)
Our Media Solution Specialist, Magnus Svensson, is sharing his reflections on the online streaming industry in this post. This is part of a monthly series so make sure to follow us here if you do not want to miss an episode.
As the streaming market becomes increasingly competitive, ad-supported tiers can help these streaming services generate additional income while providing cost-sensitive consumers with lower-priced or free access to content.
When streaming services increasingly transition to ad-funded models, it is crucial to prioritize seamless and high-quality ad experiences. Poorly timed or disruptive ads, as well as technical issues like latency and slates, can significantly impact viewer satisfaction and brand perception.
A new report from the FreeWheel Viewer Experience Lab revealed that while
consumers are not opposed to ads themselves; the quality of the ad experience can impact the overall viewing experience. Nearly 80% of viewers are bothered by slow or buffering ads, and 71% of viewers are disturbed by ad breaks that interrupt the natural flow of content.
Information is key
Buffering and the quality of the ad experience are just examples of issues connected to advertising. Less visible for the end user, but equally important, includes missing or incorrect ad tracking and lack of information provided to the ad server to perform targeting are other examples.
Without accurate tracking, streaming services may fail to properly bill advertisers, leading to potential revenue shortfalls. Advertisers rely on precise tracking data to measure the success of their campaigns. Missing or incorrect data can result in ineffective advertising strategies and poor return on investment.
Incomplete viewer data prevents accurate ad targeting, leading to less relevant ads being served, which can reduce viewer engagement and advertiser satisfaction. Advertisers pay a premium for targeted ads. Missing view information can lead to under-delivery of contractual obligations, resulting in financial penalties or loss of revenue opportunities.
Failure to invest sufficient effort
Streaming services and distributors often fail to invest sufficient effort in ensuring high-quality ads, providing correct information, and implementing proper tracking. This oversight leads to frequent issues such as poorly timed ad breaks, repetitive or irrelevant ads, and inaccurate ad performance metrics. As a result, viewers experience frustration, advertisers face inefficiencies, and overall ad effectiveness diminishes.
To address these challenges, streaming services must prioritize robust ad delivery systems, accurate data handling, and comprehensive tracking mechanisms to enhance viewer satisfaction and optimize ad revenue.
Proper implementation and automated testing are crucial to ensuring high-quality ads, accurate information delivery, and reliable tracking. Automated testing helps identify and resolve issues promptly, ensuring data integrity and compliance with industry standards. Investing in these processes yields a high return on investment by improving ad performance, maximizing revenue, and fostering stronger relationships with advertisers through trustworthy and efficient ad delivery systems.
For an ad-supported model, this can translate to increased ad revenue annually due to higher viewer retention and more effective ad placements. Thus, the initial investment pays for itself multiple times within a year, demonstrating a substantial return on investment and highlighting the critical importance of quality ad implementation and tracking.
As inspiration, you could watch the presentation made by my colleague Jonas Birmé at Streaming Tech Sweden: https://youtu.be/2euTebePPlM?si=sFuSvETskm6q5EiM
To watch out for the coming months…
New technologies in video streaming, such as Common Access Token (CAT), content-steering, and Server Guided Ad Insertion (SGAI), enhance platform efficiency and user experience.
CAT improves the interoperability between CDNs, enhancing the efficiency of multi-CDN deployments, particularly with load-balancing and content steering solutions. CAT helps in reducing the complexity associated with managing different token formats, thus enabling more seamless and secure content distribution.
These advancements collectively improve streaming efficiency, user satisfaction, and monetization.
Magnus Svensson is a Media Solution Specialist and partner at Eyevinn Technology. Eyevinn Technology is the leading independent consulting company specializing in video technology and media distribution.
Follow me on LinkedIn and X (@svensson00) for regular updates and news.
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