Home Opinions 2018: The year digital video advertising gets comfortable in the living room

2018: The year digital video advertising gets comfortable in the living room

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Premium video advertising is advancing beyond the desktop and becoming firmly established in the living room environment. In 2017 over-the-top (OTT) and set-top box video on demand (STB VOD) devices – which provide an alternative way for viewers to access video content on their television screens – together commanded half of premium video ad views in the U.S, overtaking desktop for the first time. While desktop is still marginally ahead in Europe, with 35% of ad views, OTT and STB VOD devices are hot on its heels with a combined share of 34%.

So, what does this mean for the premium video advertising market?

Digital video and linear TV will continue to converge

The shift of the premium video advertising landscape from desktop to TV is a clear indication video belongs on the big screen. This doesn’t mean digital video will replace linear TV, but rather the two will converge to create a new ecosystem where viewers can customise content consumption to their individual requirements.

Although the volume of linear TV watched by millennials is dropping, with younger audiences expressing a preference for VOD viewing, the valuable over-55 audience still enjoys linear, making it an essential part of the content mix. As viewing options expand and diversify, no single platform will dominate and additional solutions will enter the TV ecosystem to deliver value to consumers. Mobile devices such as smartphones and tablets will continue to play an important role – currently accounting for almost a quarter (23%) of premium video ad views in the US – so advertisers will need a premium video strategy that encompasses multiple platforms.


User experience will drive quality and experimentation

As viewing patterns grow more complex and media boundaries converge, there can be no let up in quality. Regardless of how they choose to view, consumers expect the same standard of relevant, entertaining, professionally-produced video advertising. While digital video strives for the exceptional quality standards of more traditional TV advertising, TV will start to embrace the experimentation and format development more commonly associated with digital.

One recent development in enhancing the user experience is the use of shorter video ads to increase impact and drive engagement. In today’s limited attention economy, short ads offer snackable viewing that delivers high reward for relatively small investment, and networks such as Fox and AMC are testing ultra-short six-second TV ads to improve the viewer experience.


Programmatic will see greater adoption  

Premium video publishers are increasing the amount of inventory they trade programmatically, with its share of monetisation increasing 19% last year to reach an all time high. Programmatic enables the use of data to target specific audience segments, improving ad relevance and allowing the experience to be customised to each viewer, and its rise looks set to continue.


Collaboration will allow competition with mass-market digital platforms  

Within the TV ecosystem, premium publishers are already building on their television carriage agreements with Multichannel Video Programming Distributors (MVPDs) by making video content available for on-demand consumption and dynamic ad insertion across set-top boxes. By working together in this way to make content more accessible, publishers and broadcasters can retain viewers and compete against the mass-market digital platforms.

Consumers have more choice than ever before in how they consume video content and are exploring the full complement of media available, leading them to cross the once clear divide between linear TV and digital video. As premium video emerges from its desktop roots to get comfortable in the living room, 2018 will be a year characterised by convergence, experimentation, automation, and collaboration.

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