A guide to broadcaster vod thinkbox

Demand delivered:

A guide to Broadcaster VOD

Contents What is Broadcaster VOD?

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Broadcaster VOD is expanding

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Building brands through VOD

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A world of new ad opportunities

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Interactivity

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‘Screen Life: TV in demand’ – why do we watch VOD?

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In a nutshell

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How can we help?

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Gadget Man Channel 4

2 A GUIDE TO BROADCASTER VOD

WHAT IS BROADASTER VOD? 3

What is Broadcaster VOD?

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VOD is everywhere. It means ‘video-on-demand’, but this can mean different things to different people, depending on what the video content is, where and when it is watched, and on what screen it is watched.

An uploaded clip to YouTube, watched on a smartphone while waiting for the bus, of someone hilariously covering their favourite song is obviously a world away from watching Game of Thrones in your living room via your Sky box on your HD TV set. So, as online video of all flavours proliferates, it is increasingly important to distinguish between the different forms.

Not all VOD is created equal and certainly not as far as advertising opportunities go.

This booklet, produced in association with The Marketing Society, is concerned with the premium end of the VOD spectrum, known as Broadcaster VOD. This is prime advertising real estate; the fertile soil that brands can grow in. It is the high-quality content made available on-demand by

Broadcaster VOD is prime advertising real estate; the fertile soil that brands can grow in.

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01 Honda Wieden+Kennedy 02 O2 VCCP 03 Educating Yorkshire Channel 4 04 Game of Thrones Sky Atlantic 05 Downton Abbey ITV 06 Hell on Wheels TCM

the TV broadcasters – Educating Yorkshire on 4oD, Downton Abbey on ITV Player, A League of Their Own on Sky Go, or Red Dwarf on Dave On Demand. Broadcaster VOD is essentially TV-on-demand. There are also other quality VOD services (like Lovefilm, Netflix and Blinkbox) which are subscription-based services generally unrelated to broadcast TV schedules.

Currently they do not offer advertising.

07 Red Dwarf Dave

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4 A GUIDE TO BROADCASTER VOD

WHAT IS BROADASTER VOD? 5

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ON-DEMAND SERVICES BY PLATFORM Platforms Android BT Vision Freesat Freeview HD iOS

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PS3 Smart TVs Sky HD Virgin Media Wii Windows Xbox

Broadcaster VOD is still a small percentage of overall TV viewing but is expected to grow.

01 Skoda Fallon

YouTube

02 EE Saatchi & Saatchi

YouView

03 Virgin Atlantic Rainey Kelly Campbell Roalfe/Y&R

BBC iPlayer

ITV Player

4oD

Sky Go

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Broadcaster VOD is popular and growing, with commercial broadcaster players – and the BBC iPlayer of course (though no ads allowed there) – now found on many platforms and devices including YouTube and games consoles.

In terms of our viewing habits, VOD – Broadcaster or otherwise – has not so far affected the amount of time people spend watching linear TV. Broadcaster VOD is still a small percentage of overall TV viewing – an additional 2.5% based on broadcaster and Ofcom data – but it is a very interesting one with some exciting advertiser opportunities – and is expected to grow.

People watch linear TV and VOD for different, complementary reasons. People watch VOD for increased choice, more control, me-time, a bit of content bingeing, to time-shift something, to place-shift it, and perhaps to discover new stuff. But overwhelmingly they watch it to catch up, so they can get back to the linear schedules (see page 16 for an overview of Thinkbox’s ‘Screen Life:TV in demand’ research which examined why people watch VOD and live TV).

From the key numbers and the latest research to the different advertising formats and some inspiring examples of great VOD

Demand 5

Now TV

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Sky On Demand

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Really On Demand

Yesterday On Demand

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People watch linear TV and VOD for different, complementary reasons, but overwhelmingly they watch VOD to catch up.

ad campaigns, this booklet is designed to help you cut through the clutter and get to grips with what VOD means for viewers and advertisers.

One note on regulation: VOD, excluding UGC and newspaper websites, is regulated

by ATVOD (Authority for TV On-Demand) under licence from Ofcom. Ofcom knows that the British public expects professional ODPS (On-Demand Programme Services) to conform to the high standards of broadcast TV in most respects. VOD content must meet ATVOD standards and VOD advertising must conform to the CAP code for the quantity and nature of its ads.

Dave On Demand

04 4oD Channel 4 06

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05 ITV Player ITV 06 Dave On Demand UKTV 07 Sky Go Sky

* Q4 2013 launch

6 A GUIDE TO BROADCASTER VOD

BROADCASTER VOD IS EXPANDING 7

Broadcaster VOD is expanding Numbers are important and here you’ll find the ones you need to help you understand how Broadcaster VOD is establishing itself as an important part of our TV diet.

One point to bear in mind: the assumption is often that any TV viewing on non-TV set devices or over the internet is VOD. This is mostly but not entirely true. Some viewing over the internet or on other devices is streamed live TV. This is particularly popular when major sporting events happen during working hours such as the Olympics and Paralympics last year.

Measuring all these new ways to watch TV is a major challenge and BARB, the body which measures TV viewing officially in the UK, is currently enhancing its methodologies;

Karl Pilkington’s Seven Wonders of the World Sky1

it is installing meters in its panel homes to measure in-home TV viewing on PCs and laptops up to 28 days after the initial broadcast. We don’t yet have official, device-neutral VOD measurement from BARB – but it is coming.

So, with that caveat, here are the most reliable numbers currently available for the various activities associated with watching Broadcaster VOD.

8 A GUIDE TO BROADCASTER VOD

BROADCASTER VOD IS EXPANDING 9

KEY VOD TRENDS

Robinsons BBH

X Factor ITV

2.5%

6.5

An additional 2.5%: small but beautiful This is the proportion of overall TV viewing accounted for by Broadcaster VOD in the UK, according to data from Ofcom and the broadcasters. This will grow, but it is important to keep in mind how early in its development we still are.

6.5 minutes a day This is approximately how much Broadcaster VOD the average UK viewer watches a day across all screens. This is based on an estimated 3 minutes, 12 seconds a day that is watched on a TV set plus the 3 minutes, 30 seconds a day of TV watched on devices other than a TV set, the majority of which is Broadcaster VOD but some of which is streamed live TV (sources: UK broadcaster data for Jan-Jun 2013 and Ofcom CMR 2013).

Overall, this works out as approximately six half-hour TV shows a month watched via Broadcaster VOD.

minutes

21%

rise

VOD demand is rising Unique programme requests for Broadcaster VOD are estimated to have risen by 21% between the second half of 2011 and the second half of 2012 (source: Ofcom Communications Market Report [CMR] 2013).

40%

UK

Broadcaster catch-up is most popular 40% of the UK claims to watch TV programmes (either streamed or downloaded) via broadcaster catch-up services, such as ITV Player, 4oD or Sky Go. This compares to the 16% who claim to use other non-broadcaster VOD services, such as Netflix, Lovefilm Instant and Vimeo on a regular basis (source: Ofcom CMR 2013).

42%

30%

The TV set is the favourite place to watch VOD Broadcaster VOD consumption breaks down as: 42% via the TV set, 38% via a PC/laptop, 12% tablet and 9% via a smartphone. Catch up TV was the most commonly used bit of internet functionality for Smart TV owners (source: Ofcom CMR 2013).

Tablets on the rise Tablet ownership has nearly trebled in the past year, rising from 11% of homes in 2012 to 30% in 2013 (source: IpsosMORI Tech tracker Q3 2013). Tablets now account for 25% of BBC iPlayer requests, up 10% year-on-year. There has been a significant drop in people viewing VOD content via PC/laptop, which has fallen from a 54% share to 33% (source: BBC iPlayer data, August 2013).

2013

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BUILDING WHAT IS BRANDS BROADCASTER THROUGH VOD? VOD 11

Building brands through VOD It may be wonderful that VOD is growing in popularity, but why should advertisers care? And, more specifically, why should they invest?

Put simply, Broadcaster VOD offers advertisers a premium brand building environment: all the glorious TV programmes from broadcast telly to put your TV ads in or to sponsor, but with some added functionalities from the online, mobile or IPTV platforms that VOD is available on.

But it can do other many other things and there are many benefits to advertisers from investing in Broadcaster VOD. Here are the key ones:

own right, particularly for categories and brands with a youth or tech bias.

RESPONSE Pre- and mid-roll ads delivered via the web or mobile have a return path and most are clickable. These can deliver strong response levels – which far outperform average click-through rates for online display advertising – and this makes VOD advertising the ideal stepping stone between brand advertising on linear TV and advertiser websites.

COMPLEMENTING YOUR LINEAR CAMPAIGN

INTERACTION

Broadcaster VOD is a perfect complement to your linear TV campaign. Its heaviest users are often lighter viewers of linear TV, so it can provide some incremental 1+ and other low frequency reach. The demographics of VOD viewers make them very attractive and valuable in their

The broadcasters have developed a variety of formats to encourage viewer interaction with brands. In addition to a quick response, VOD ads can offer deeper brand immersion experiences for viewers, such as games, competitions and exploring extended information.

You can see more on this on page 14.

ACCESSIBLE ON MANY PLATFORMS AND IN A VARIETY OF PHYSICAL CONTEXTS Broadcaster VOD is available to enjoy on TV sets, PCs, tablets and smartphones – pretty much anything with a screen!

And, because of its mobility, people can see VOD advertising when they are in contexts that encourage purchasing or other actions – e.g. while travelling to a shopping trip or work. In fact some broadcasters are developing location specific ad opportunities for VOD.

ADDRESSABILITY Linear TV advertising has the ability to be highly targeted with a judicious selection of channels and programmes.

VOD is no different because it offers the same range of quality content.

However it is developing the additional ability to deliver customised addressable advertising, either at a household level for a shared set or at an individual level for personal devices. The data used to activate addressability can be sourced in various ways but, increasingly, it is first party data, given willingly by viewers to their trusted broadcasters. This is vastly superior to the data modelled from behavioural tracking.

Celebrity Juice ITV2

12 A GUIDE TO BROADCASTER VOD

A WORLD OF NEW AD OPPORTUNITIES 13

A world of new ad opportunities

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Broadcaster VOD is brimming with ad innovation, and new developments are emerging all the time, but it’s important to get it right. Here is a run-down of the main formats and some important considerations.

PRE-, MID- AND POST-ROLL VOD FORMATS

the broadcasters sell slots in VOD, not precise minuteage.

Broadcast-like linear ads – normally 30 seconds long but they can be shorter or longer – can be served to VOD viewers in three ways:

SPONSORSHIP, AFP, PRODUCT PLACEMENT

• Pre-roll – before the content • Mid-roll – in a centre break • Post-roll – after the content finishes All the UK broadcasters serve ads using these. This is similar to the way that spot advertising appears around linear TV content. The general guideline is that the shorter the content to be viewed the shorter the ads should be. There is some more flexibility than in linear TV because

However sometimes there are VOD-only opportunities where broadcasters have created extra content for their web players. It is also possible for brands to create branded content (advertiser funded programming) or branded microsites or games.

03

TARGETING AND DATA

In VOD, individual shows can be sponsored, as can genres. Best practice is for the broadcast sponsor to follow the content to VOD, aligning itself with that programme in whatever form it is made available.

Depending on the broadcaster, you can target VOD audiences based on the smart analysis of data. Ideally this data is acquired directly from subscribers or website registered users who trust broadcasters with their personal data.

01 IKEA Mother 02 Samsung CHI & Partners 03 Tango BBH 04 Marmite adam&eveDDB

Broadcasters are investing a lot in this exercise and they already have many millions of registered users who have been happy to share their personal information with the broadcasters.

TV platform owners, like Sky, Virgin, BT Vision or Talk Talk, obviously have paying subscribers about whom they know a great deal and some have supplemented this information with a voluntary questionnaire.

These sources of first party data really distinguish broadcaster VOD targeting from other forms of online advertising which rely heavily on modelled behavioural data through the use of cookies.

Broadcaster VOD can therefore target by:

Once postcodes are known other public sources of data can be fused to add depth. Advertisers’ own data can also provide insight and services like SkyIQ are helping brands build all these sources into highly intelligent targeting tools.

• Socio-demographics • Geographics • Content context • Other data: This can come from volunteered household/user information, advertisers’ own customer information, public data sources (e.g. Experian, Acorn) or behavioural data.

• Platform: Sky Go has also recently introduced the ability for advertisers to target by platform i.e. Xbox, Android, Apple iOS or PC.

Sources of first party data really distinguish Broadcaster VOD targeting from other forms of online advertising.

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Interactivity

INTERACTIVITY 15

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This is where VOD comes into its own. There are a number of exciting and innovative interactive formats available in Broadcaster VOD. 02

They usually feature instead of a standard pre-roll ad and mean viewers can respond to an ad and see the results of that interaction in the VOD player. They can take the form of: a game or a competition, opportunities to access more brand content, integration with social media or something as simple as being able to choose which ad to watch.

Interactive formats are evolving all the time – there are currently a dozen or so plus bespoke options – so it’s worth speaking to the broadcasters if you have an idea that you want to investigate.

For the full menu of what ad opportunities each UK broadcaster offers, and to find out about the very latest formats, either visit the VOD section on www.thinkbox.tv or visit the broadcasters’ websites:

ITV Channel 4 Sky Media UKTV Turner

www.itvmedia.co.uk www.channel4sales.com www.skymedia.co.uk www.channel4sales.com/platforms/uktv www.turnermediainnovations.com

TETLEY TEA AND CHANNEL 4’S AD PAUSE

THINKBOX AND ITV’S MICROSITE

Dare, MediaVest Ad pause gives advertisers the opportunity to be an exclusive ‘pause partner’ across each genre of 4oD on Channel4.com.

Each time a viewer presses pause, an animated or static ad fills the player and remains until the user resumes or exits.

This worked particularly well for Tetley as there are occasions when people take a break from viewing to make themselves a nice cup of tea.

The Red Brick Road, MediaCom, Brainient Thinkbox was among the first advertisers to use ITV’s new Ad Explore suite of interactive VOD advertising formats which launched in September 2013. The new Microsite format, which lives within the VOD player, featured a Harvey & Rabbit video gallery, the ability to personalise and share imagery, several direct response elements and, for those who want to find out more, links to discover more about TV advertising.

CRAVENDALE AND CHANNEL 4’S AD BLOOM

SANTANDER AND ITV’S AD EXPLORE PRO

Wieden & Kennedy, Carat Viewers see a brief pre-roll then a branded custom transition opens the experience which is bespoke for each advertiser.

The format increases brand engagement and time spent with videos, product features and photos. Cravendale used Ad Bloom to encourage consumers to sign up to their ‘Love Cravendale’ website and claim rewards such as golfing sessions or horse riding lessons by entering codes found on 2 litre bottles.

Havas Worldwide, Carat With ITV’s Ad Explore Pro, advertisers are able to create a bespoke option for their brand. Here, Santander took over the ITV player window with an interactive calculator from Santander’s website as part of their 123 campaign, enabling viewers to get cashback whilst watching their favourite TV online. There were then further options; to like the brand on Facebook or find out more and apply for the account.

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01 John Lewis adam&eveDDB 02 Kronenbourg Ogilvy & Mather 03 3 Wieden+Kennedy

16 A GUIDE TO BROADCASTER VOD

‘SCREEN LIFE: TV IN DEMAND’ – WHY DO WE WATCH VOD? 17

‘Screen Life: TV in demand’ – why do we watch VOD? In 2013 Thinkbox commissioned two research companies – Flamingo and Tapestry – to look into how people watch TV, whether live or on demand. We wanted to find out why people were watching VOD and how that differs from and adds to linear viewing.

The study, ‘Screen Life: TV in demand’, was described as a ‘breakthrough’ by Campaign magazine and revealed the key differences between watching TV live and VOD and between different types of VOD. It also explained why live viewing continues to thrive alongside VOD. The study involved the analysis of over 100 hours of footage from 18 households from across the UK for two weeks. It also involved a diary study of 662 adults, across 3,692 viewing occasions providing 250,000 data points for analysis.

A League of Their Own Sky1

The research sample was more technologically advanced than average.

All respondents owned a smartphone and 46% owned a tablet. Crucially the sample was also composed of heavy VOD viewers with 74% of the sample watching VOD at least once a week. This compares with the 52% of the UK who has ever watched VOD, according to IPA Touchpoints data.

18 A GUIDE TO BROADCASTER VOD

‘SCREEN LIFE: TV IN DEMAND’ – WHY DO WE WATCH VOD? 19

THE SIX NEED STATES OF TV VIEWING

Mr Selfridge ITV

Personal

Unwind Is about deferring the pressures or de-stressing from the pressure of the day with something to soothe us.

ESCAPE

UNWIND

EXPERIENCE

COMFORT

CONNECT

RESEARCH FINDINGS: SIX REASONS WE WATCH TV

YOUNG PEOPLE ARE HAPPY TO WAIT (SO THEY CAN SHARE)

The study explains why, in an era when people can choose to watch what they want when they want, the UK continues to watch live TV 90% of the time: the live TV experience satisfies human emotional needs that on demand viewing alone can’t (see graphic opposite).

Connecting was the most common reason to watch TV for 18-24s. 28% of their viewing was in order to connect – almost double the average from the research sample (15%).

‘WHAT’S ON’ IS FIRST PORT OF CALL Even among the heavy VOD viewers in the research sample, 60% typically checked what was on the live TV schedule first before considering other options.

THE TV SET RULES The TV set is overwhelmingly the preferred way to watch, whatever the reason people are watching. This is especially true of TV for comfort or to unwind, where at least 90% is watched on the TV set.

When given a choice between having the option to download a new series they liked in one go or waiting to watch it week by week on live TV, 73% of 18-24s in the research sample said they prefer to watch it week by week. This was more than the older audience of 35-55s (57%).

VOD EXCELS AT SATISFYING PERSONAL APPROACHES TO TV VOD is specifically good at satisfying indulging and escaping, but it is less equipped for more social needs such as unwinding and seeking comfort. This is supported by the finding that for 54% of

the occasions we watch live TV we’re with someone else compared to 30% for VOD. And for viewers who want to connect and feel like they are sharing a TV experience with the outside world, then live TV was judged by far the best way.

TV REMAINS ROOTED IN THE LIVING ROOM BUT NEW DEVICES ENABLE ‘PLACE-SHIFTING’ Live TV is almost exclusively watched on a TV set, however, in the study’s heavy VOD-viewing sample, VOD was split across different screens: 37% was watched on the TV set; 45% on a PC; 14% on a tablet; and 4% on a smartphone.

The further away people go from live TV, the less likely it is they are watching on a TV set. Only 5% of social video – such as on YouTube – was watched on a TV set, compared to 62% on a PC, 11% on a tablet, and 22% on a smartphone. It is

Context

Content

INDULGE

Comfort The need for shared family time; we seek togetherness, rituals, familiarity and routine.

Connect The need for a sense of ‘anchoring’ – to feel a sense of connection to society, to time or to place.

Social

Experience The need for fun, energy and a sense of occasion. Experiences create the glue that can bind families and friendships together.

Escape The need to leave the ‘everyday’ behind. Programmes act as portals to another time and place entirely.

Indulge Is about the need for me-time; it’s about satisfying your (typically guilty) pleasures with your truly personal favourites, usually alone.

VOD EXCELS AT MEETING THE ESCAPE NEED STATE The study showed that there are some important need state differences when VOD is compared to live TV. VOD is about delivering great content when you want it, therefore the content-based needs – and Escape in particular – are much more likely to be met by this platform; at the expense of context-based needs like Unwind, Comfort and Connect. Because VOD doesn’t meet the full spectrum of needs in the way live TV does, it’s not a replacement for live TV but a ‘boost’ when you need it.

Live TV

23%

VOD

41%

21% 18%

11%

18%

14%

19%

15%

8%

8% 3%

20 A GUIDE TO BROADCASTER VOD VOD

‘SCREEN LIFE: TV IN DEMAND’ – WHY DO WE WATCH VOD? 21

Anchor CHI & Partners

also less likely they are watching with someone else: 54% of live TV viewing was with someone else compared to 30% on VOD and 19% on social video.

Social video is also watched in different locations: 34% in the living room, 56% in another room, and 10% out of home. For VOD this place-shifting is evident but less pronounced with 51% of viewing in the living room, 43% in another room, and 6% out of home.

MATCH THE AD TO THE NEED The study found that congruent advertising (where the ad creative matches the need state of the viewer) can help advertisers maximise the effectiveness of their campaign – a finding which supports previous studies into congruence.

Matching the category or brand, tone and message to the predominant need state of the audience will increase response, especially if this also suits the device being used – for example: advertising a luxury car, something aspirational and 8 Out of 10 Cats Does Countdown Channel 4

special, would fit well with viewers in an escape need state; an ad for something indulgent, something ‘naughty’ – such as Pot Noodle or a chocolate brand – would function well for viewers in an indulge need state.

Since live TV satisfies all the need states identified by the study, a wide range of narrative styles and advertisers will fit.

Since VOD excels at heavily content-based need states, and is currently used on other devices, advertisers need to be more cautious and must work hard to make their ads acceptable, whether through creativity, relevance or congruence.

LIVE TV IS FOOD, VOD IS CHOCOLATE One other finding from the study came when we deprived people of live TV for four days. Beforehand they were confident they could easily live without ‘normal telly’ and feast solely on on-demand. But, once live TV was gone, these people

quickly realised how much they missed it. People who claimed they only needed on-demand quickly realised they didn’t.

One reason for this is that when you make an active choice to do something – like search for and watch something on 4oD or ITV Player – it is easier to remember.

Relaxing on the sofa, browsing the EPG and choosing something you fancy is less memorable, but no less important in terms of how we enjoy TV. Like electricity and running water, live TV is something we all take for granted; only by losing it do we start to realise how vital it is. VOD is like a box of chocolates, a highly enjoyable treat; live TV is our regular daily food that we wouldn’t want to live without.

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PAGE IN ATITLE NUTSHELL HERE 23

In a nutshell Broadcaster VOD is an exciting and evolving landscape which offers advertisers a host of premium advertising opportunities around trusted, quality content. It is an important new part of the TV eco-system that is helping people to watch more of the TV they love.

We hope that this booklet has brought the world of Broadcaster VOD to life and will inspire you to see what it can do for your brand.

Broadchurch ITV

24 AA GUIDE GUIDE TO TO BROADCASTER VOD VOD

HOW CAN WE HELP? 25

How can we help?

Thinkbox is here to help advertisers get the best out of television, which includes providing robust advice and inspiration about the latest innovations from the world of TV. To that end, we’ve put together a special section on our website dedicated to VOD, from planning and buying to the latest interactive examples from the broadcasters. Please visit www.thinkbox.tv and click on the VOD tab if you’d like to find out more.

If you’d like to discuss the VOD opportunities further, then please contact any or all of the following:

THINKBOX

BROADCASTERS

The Planning Helpdesk info@thinkbox.tv

Channel 4 Jon Lewis jlewis@channel4.co.uk

Turner Andrew Mallandaine Andrew.Mallandaine@turner.com

ITV Stephen Poole Stephen.poole@itv.com

UKTV Sarah Goldman sarah.goldman@uktv.co.uk

Leila Travis Head of planning Leila.Travis@thinkbox.tv Tomek Lasocki Planning executive Tomek.Lasocki@thinkbox.tv

Chickens Sky1

Sky David Fisher david.fisher2@bskyb.com

About Thinkbox

About The Marketing Society

Thinkbox is the marketing body for commercial TV in the UK, in all its forms. Its shareholders are Channel 4, ITV, Sky Media, Turner Media Innovations and UKTV who represent over 90% of commercial TV advertising revenue through their owned and partner TV channels.

Thinkbox works with the marketing community with a single ambition: to help advertisers get the best out of today’s TV.

The Marketing Society is an exclusive network of senior marketers. Over the past 54 years we have emerged as one of the most influential drivers of marketing in the business community.

The Society challenges its members to think differently and be bolder marketing leaders by supporting the development of leading-edge thinking and promoting the evidence of effective marketing. We are the place for discerning marketers to learn, develop and share best practice. www.marketingsociety.co.uk

Shareholders

Associate Members Thinkbox TV Ltd. Manning House, 22 Carlisle Place, Victoria, London SW1P 1JA Tel. 020 7630 2320 www.thinkbox.tv

Thinkbox Supporters