Opinion
Viewing figures This month, with Ofcom reporting VOD as the No.1 viewing destination for children, Jonathan asks if is it time for a rethink on advertising strategy?
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nce again reports of linear TV’s demise have been widespread, following the publication of the latest Ofcom report for 2019 (covering 5-15 year olds). The increased accessibility and availability of competing/ complementary platforms means marketing strategies now require a multi/omni-channel approach. Significant declines in linear TV viewing are being reported, so is TV still deserving of a starring role in 2020 marketing strategies? According to Ofcom’s “Children and parents: Media use and attitudes report 2019”, 80% of 5-15 year olds viewed VOD content (Netflix/Amazon Prime/iPlayer/etc.) in 2019. This placed it as the No.1 viewing platform ahead of both live broadcast TV and YouTube, which both registered 75%. VOD’s position at the top of the viewing pyramid has been delivered by significant recent growth, having just 44% penetration in 2015. However, is this really that much of a surprise? The rise in usage amongst 5-15 year olds of connected TVs (67%), tablets (68%) and mobiles (55%) – all of which are up year-onyear – has also given rise to a huge volume of VOD providers competing for attention. In the current race for children’s attention, accessibility is key and VOD (in all its guises) has successfully managed to infiltrate every aspect of children’s video tech. Unsurprisingly, these numbers only increase as children get older, with 88% of 12-15 year olds viewing VOD in H1 2019 - but VOD and tech led viewing should no longer be seen as the preserve of older audiences. Netflix has been particularly successful in engaging 2-3 year olds, thanks to the way it is navigated pictorially, with 16% of this audience accessing in H1 2019 compared to just 13% of 8-9 year olds. This has helped Netflix to grow its market share by almost 100% over a period of two years. However, the success of Netflix does highlight the biggest problem with the VOD market for marketers. Most high-profile opportunities are non-commercial, and whilst commercial platforms are growing rapidly, they do not singularly have the fame or user base of
Netflix et al. This produces further complications from a content and licensing perspective. In this multichannel landscape, content needs to be distributed across as many platforms as possible, meaning rights management negotiations can become protracted and complicated. VOD will therefore form an increasingly important part of the marketing mix in 2020, however it is not yet in a commercially viable position to challenge linear TV for the lion’s share of budget. YouTube ties TV for usage amongst 5-15 year olds according to Ofcom (75%), and crucially, it remains 100% commercial (despite recent policy changes). This number will only grow given the breadth of content YouTube provides. Not only does it cover the myriad of interests and hobbies that children of all ages aspire to, it is now also a valuable educational platform, with 60% using it to view clips on how to build or create things (up from 42% in 2018). Influencers also continue to make up a large proportion of children’s viewing time. We are seeing movement away from the traditional global influencers though (at least attitudinally), with the fastest growing part of this market being micro/nano influencers. These may have smaller subscriber numbers, but children are increasingly drawn to local influencers with whom they share a perceived connection. Given all this, it is little wonder that YouTube has become incredibly popular amongst toy and games advertisers in the UK, however it is not yet as ubiquitous as TV. Perhaps this is down to the short form nature (in the main). Whilst it is used as frequently, it is not as sticky, with viewers spending less time per session than they would traditional linear TV. History and tradition plays a large part as to why TV has always been the No.1 destination for toy and games advertising budgets, but the fact that linear TV still (for the time being) provides the best value proposition to the market cannot be understated. This is both from a cost and reach perspective (not to mention the historic track record of producing Return on Investment
Toy World 20
Jonathan Chambers Director of AV Investment, Generation Media. Tel: 0207 307 7906 Jonathan.Chambers@generationmedia.co.uk compared to its as yet unproven competitors). The Ofcom report also neglects to break down the sheer extent of platforms and channels both VOD and YouTube sit across. VOD has grown substantially as a direct result of huge increase in means of accessing On Demand content, be that via the different providers (Netflix/Amazon Prime/iPlayer/etc.) or platforms (Tablet/Mobile/ Connected TV/etc.). Whilst total penetration has increased, coverage by VOD platform (YouTube for instance) is much smaller. The Kids and the Screen data provides us with the complete viewing picture when it comes to 2-12 year olds and allows us to see that, despite the undeniable declines in traditional TV (with over an hour of viewing time per week being lost year-on-year), it still remains the No.1 destination for all age groups when it comes to viewing, with live and recorded TV accounting for 36% of all viewing occasions in H1 2019 (YouTube, No.2 by this metric accounted for 21%, inclusive of YouTube Kids). Whilst this remains the case, and the cost remains as efficient as it currently is, TV will still play a leading role in most advertising campaigns directed at children. Linear TV’s importance is elevated further when you consider that Giraffe Insights’ Kids and the Screen reports that live and recorded TV accounted for 53% of all adverts recalled by 2-9 year olds in H2 2019. Let’s also not forget the multitude of other offerings with growing appeal, fronted by TikTok. A quarter of all 10 year olds now have a social media profile of some description (even 4% of 5-7 year olds), with TikTok the fastest growing amongst social media platforms. In 2018, only 8% of 12-15 year olds used TikTok. This has grown by over 50% to 13% in 2019 and is set to grow further in 2020 as the Chinese backed platform continues to invest significant sums in above the line marketing.