The latest figures from Ampere Analysis covering the U.S. confirm the rise of ad-supported streaming and the extent to which AVOD and BVOD are starting to assert themselves in the market for high-quality content. Nobody is downplaying the continued popularity of SVOD, but the analyst group’s consumer figures show that 14% of the viewing day in a U.S. streaming household is now spent watching AVOD or BVOD. In Q1 2020, AVOD and catch-up streaming contributed 0.6 services to the average streaming service stack in a U.S. home but a year later this figure was 1.0.
Most ad-supported streaming services can expect 10-15% of users to watch their streaming service. Q1 2021 monthly active user figures from Ampere Analysis show 14% for NBC online video, 11% for The Roku Channel, 12% for Pluto TV, 13% for Tubi and 10% for Fox Now, as examples. 47% of homes are watching BVOD, while 58% are watching SVOD.
A demographic breakdown shows that while Netflix skews young (with its audience spread across 18-24s and 25-34s, with lesser penetration in 35-44s) and broadcaster streaming services are popular with 18-24s and 35-44s, the non-broadcaster AVOD services skew older. AVODs start picking up viewers in the 35-44 age range but do especially well where Netflix and the broadcasters lack streaming penetration: 45-54s and 55-64s.
Presenting his research on the trajectory of the ad-supported streaming market to the Future of TV Advertising U.S. conference this summer, Guy Bisson, Executive Director at Ampere Analysis, pointed to a changing content strategy among ad-supported streamers, as they start commissioning original productions – following the path already taken by SVODs. He noted a notable uptick in original commissions in Q1 to Q2 2021.
Ampere Analysis has discovered three themes that dominate the new content, too: coming of age shows, ethnic diversity themes and family challenges. “These themes are interesting because they diversify the audience that tends to skew towards the older generation. These services [ad-supported streamers] are starting to evolve a content strategy to attract younger audiences that are more interesting to the advertising market. We will see more of that moving forwards.”
New shows that fit into these ‘themes’ include The Now (Roku), How to Survive Inglewood (Peacock), Primo (IMDB TV) and Safehaven (Crackle), as examples.
Ampere Analysis has already seen a shift in the quality of the content within ad-supported streaming services (as perceived by consumers, judged by ratings given to content). “Studio direct platforms [D2C streaming services] have small catalogues of highly popular content and Netflix maintains high popularity for its content despite the large size of its catalogue. Until now, AVOD players have skewed towards larger catalogues and have not asserted themselves in higher quality content,” Bisson explained.
“But AVOD services are beginning to converge around similar catalogue sizes of 5,000-10,000 hours and they are starting to ascend the quality ladder. Some of the AVOD services are starting to knock on the door of SVOD services, in terms of quality. And that is going to change faster now a number of them are commissioning original content.”
Bisson reckons all ad-supported streamers benefited from lockdown when there was a surge in consumer interest in titles that they carried. Interest in their content remains higher than pre-lock down levels, he reported.
A key message to the U.S. TV advertising audience was that AVOD is on an upward trajectory in terms of competitiveness vs SVOD, and consumption. “Broadcaster streaming services and free online video are beginning to assert themselves as significant contributors to the viewing day,” Bisson declared. “And AVOD platforms are now a force to be reckoned with in terms of content attractiveness, and that is crucial going forwards as the streaming market evolves.”