It’s time to rethink the video streaming wars. Here’s why

Michael Kassan / August 2020
A stylized video play button hovers over an array of device screen types. In the foreground a Black woman interacts with her mobile phone.

Michael Kassan is the founder, chairman and chief executive officer of MediaLink, a strategic advisory firm that helps drive growth for businesses in media, advertising, and technology. Here he shares advice for video advertisers who are navigating the streaming wars.

It’s a classic romantic comedy trope: Protagonist spends years searching for their perfect match. They try dating all types of people, and just when hope is nearly lost, they realize true love has been standing right in front of them all along. I’m going to connect this to the video streaming wars, so stick with me for a minute.

Billions of dollars are being poured into content and promotion for everything from the new HBO Max to Quibi to tried-and-true Netflix. According to Comscore, watch time for digital streaming platforms is way up. With a 20% increase in the past year, they now reach 68% of Wi-Fi-enabled households.1

And yet, many advertisers I’ve interacted with feel like there’s a party being thrown and they are tapping on the window trying to get in. Several ad-supported players like Peacock, Hulu, and Pluto TV are on the rise. But, right now, getting the reach they need requires piecing together several platforms. There’s seemingly no perfect match.

This leaves many video advertisers overly reliant on linear TV. While TV viewership spiked during the start of the pandemic, research shows that we can expect it to level off and for pre-COVID patterns of decline to continue.

So where does this leave our movie protagonist who’s ready to give up and the advertiser who is equally frustrated? With an opportunity to consider what they may have been overlooking all along: a steady, good friend who is a little hard for their parents to understand and a little different from everyone else. There are a lot of ways to achieve reach amid the digital streaming boom. But today, I want to talk about creator-driven content.

How important is content quality, really?

Cheesy analogies aside, we know that a lot of people are watching creator-driven content on platforms like YouTube. In the U.S., YouTube represents 40% of all ad-supported streaming watch time.2 We also know that it’s often overlooked because of a sticky issue: content quality. Of course, I get it. It’s tough to compare creator-driven content with the latest award-winning show.

A red pie chart wedge represents the following stat: 40% of all ad-supported streaming watch time is viewed on creator-driven platforms like YouTube.

But this is where unconventional wisdom takes hold. Research shows that people care more about content that speaks to them personally.3 In fact, people have said that when they’re choosing what to watch, relating to their passions is 1.6X more important than whether content has high production quality — and 2.7X more important than whether it has famous actors.4

This translates to ad effectiveness. Ipsos and Google recently conducted a lab study where they compared the performance of video ads that ran against both creator/endemic content and traditional broadcast TV content. The result?

Performance lifts across objective — including ad recall, awareness, consideration, and purchase intent — were consistent across the board.5

Viewers are telling us — with their eyeballs and their dollars — that what they value today is different. They prioritize places where they can watch content that feels personal, and where they can explore every oddball and mainstream interest they have. Creator-driven content is an answer that’s been in front of advertisers for years. There’s no better time to seize it.

The untapped potential of video for performance

Still not quite convinced? Then continue to hear me out. The streaming wars have created a second lucrative opportunity for advertisers, and creator content sits at the heart of it.

Video has traditionally been used for brand building, to great effect, because it’s the ultimate reach tool. But just as Unilever brought Dollar Shave Club into the fold and Disney unveiled Disney+, all industries are transforming to get closer to consumers. Ad-supported video players have evolved their platforms to play a bigger role across the customer journey. In practice, this means giving marketers the ability to lean into precision and performance solutions.

A red pie chart wedge indicates the stat: 70% of YouTube viewers say they bought a brand as a result of seeing it on YouTube.

This capability is driven, again, by shifts in people’s behavior. People today spend a lot more time searching for and researching products before they buy. Often they rely on information and reviews they find watching online video. Research underscores that video is an important tool in the path to purchase: 70% of YouTube viewers say they bought a brand as a result of seeing it on YouTube.6

As video streaming continues its meteoric rise, there’s abundant opportunity for advertisers. The first step toward seizing it will require advertisers to challenge their assumptions. The path forward may be different from what we imagined, but by rethinking and evolving, we can reach and connect with people on a deeper level. That’s the storybook ending we’re all after.

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