Catherine Sullivan is the U.S. CEO of Omnicom media agency PHD. Here she describes how she and her agency advise clients on how to approach the fast-growing connected TV market. Yiğit Yücel, YouTube ads marketing manager at Google APAC, shares additional APAC insights.
The way we watch videos has changed. Viewers, not networks, are choosing what appears on their television screens. For me, that means catching up on clips from my favourite late-night shows before squeezing in a quick guided workout. Those are two very different pieces of content — both meeting my personal needs at the right moment for me. Why would I go back to linear TV? Why would anyone?
The following shows how PHD is guiding clients through the connected TV landscape and provides some insight into how the space is redefining our viewing habits. It also covers what we tell them about the way brands should approach these evolving market trends.
Connected TV is redefining television
After a higher-than-expected spike in 2020, digital video viewers in Asia Pacific will rise 6.5% this year to 1.93 billion. Digital video viewers in the region will exceed 2 billion by 2022, a year earlier than previously projected. Connected TV is a major factor driving this evolution, offering viewers the same level of choice and control on their television screens as they have grown accustomed to on their tablets and phones. This is not a year to take incremental or baby steps when it comes to how you’re going to spend your money on media. If you don’t take that massive leap forward and invest in streaming, you could be left 10 years behind.
People have changed the way they think about streaming and the way they define television. For instance, according to Talk Shoppe, users in Australia are most likely to say their definition of “TV” now includes YouTube and streaming services like Netflix and Stan.1 Over 25% of logged-in YouTube CTV viewers in Australia watched content almost exclusively (>90%) on the TV screen.2 To many viewers, television no longer means something that’s slickly produced. For Aussies, YouTube is the number one platform for providing personal and relevant content.3
People are also spending more time watching YouTube via TV screens. Viewers in Japan watch YouTube videos that are on average 10% longer than videos viewed on mobile or desktop, and each viewing session is more than 60% longer than that of other devices.4
When people are choosing what to watch, they’re just as likely to check in on their favourite YouTube creator as they are to embark on the latest network series. I tell my clients that they need to start looking at audiences — not only who they are, but what their preferences are — and go where the growth is.
Streaming platforms are the primary destination for video
At its best, watching television is a communal activity. During my more than two decades in network TV sales, this was always a linchpin of our pitch to agencies and brands. In fact, it gave rise to its own cultural phenomenon: the watercooler effect. The phrase encapsulates how the desire to share a great content experience has a second life outside of the actual viewing environment.
We want to enjoy content that speaks to us personally, but we also want to share it with others. Connected TV allows us to do both by creating personalised viewing schedules to watch with friends and family. Just as the desire for choice and control led people to move from networks to streaming platforms, the desire for community is driving a shift from phone and tablet viewing back to the TV screen.
By turning it into a shared experience, connected TV has changed the way people think about streaming. For instance, over 50% of those who watch YouTube on TV screens in Japan watch it along with family and friends. In Vietnam, more than 9 in 10 YouTube TV users are watching with family and friends, with nearly two-thirds only watching YouTube with others. And more than 8 in 10 of them agree that YouTube fosters deeper connections among co-viewers.5
People now incorporate streaming video into their lives in the same way they did with linear television. In Australia, 72% of those who watch YouTube on TV with others have created a routine around it.6 At PHD, we emphasise to our clients how people are spending their days because you need to be seamlessly integrated into that routine to stay relevant.
Digital platforms offer brands new ways to drive growth
What does this mean for brands? Just as viewers have more choices than ever, the possibilities offered by streaming can seem overwhelming. By harnessing the power of YouTube on connected TV, brands can achieve the same reach they get from linear television, with multiple added benefits. Those include personalising ads at scale, using video ad sequencing to tell powerful stories, and driving action with interactive features. The way we watch video has changed. The way we engage customers should change too.