Abstract
As the television landscape continues to evolve, content is increasingly fragmented with traditional linear broadcast, catch up services and Over the Top (OTT) Video On Demand sources all competing for viewers – not just on the TV but a growing number of devices including PCs, smartphones, tablets and games consoles.
As behaviour changes the question for advertisers is how to maintain engagement with brands across devices and media – especially among the new generations of consumers. We would like you to assess new approaches to advertising and propose innovative techniques that optimise engagement and create new revenue streams.
Organisation Background
BT is the major provider of telecommunications networks and services in the UK – as well as a global communications company, serving customers in more than 170 countries with an IP network connecting over 1,270 cities across the globe. BT Group, with annual revenues of around £20billion, is one of the 200 largest companies in the world.
BT TV is part of BT Consumer, the leading provider of consumer telephone voice and broadband services in the UK and a business unit of BT. BT has invested significantly in BT TV – a rapidly growing Pay-TV platform offering DTT, multicast linear channels and VOD services along with BT Sport delivering live Barclays Premier League Football, Aviva Premiership Rugby and from 2015 all the live coverage for the UEFA Champions League & Europa Cup amongst other leading sports rights.
Challenge Background
Traditional linear broadcast advertising spend is around £4bn in the UK and although there is some evidence that funds are being re-directed to non-traditional areas such as TV Everywhere, Catch Up and VOD – it is a fraction of the overall budget. It is likely that the lion’s share of advertising funding will remain with linear broadcast as long as it is the most popular way to consume TV and until such time as alternative methods can be shown to reach highly engaged consumers and ensure significant new revenue streams.
Furthermore, current data shows that linear consumption is still strong – BARB figures show that only 10% of linear content is recorded with the rest viewed in real time. Although this is likely to increase, Thinkbox forecast that it will plateau at 15% in the next few years. Nor is likely to be replaced with VOD considering research by IHS which found that VOD viewing accounts for only 1.7 minutes of daily consumption.
Nevertheless, viewing habits are changing – especially among younger consumers who increasingly consider smartphones and tablets as their ‘first’ screen – a survey by The New York Times concluding that 34% of these Millennials do not watch any broadcast content. Even if the majority of TV advertising remains linear, there are significant opportunities for advertisers and brands to reach consumers through new devices and media.
There is a great deal of activity within second screen for advertising and companion apps but there does not appear to be a consensus on what exactly constitutes a companion app with regard to when or where it is used. For example, do viewers engage with apps during programmes or before and after – in front of the TV or away from it?
There are currently a number of solutions attempting to engage viewers, such as pre- mid- and post rolls, Shazam type audio tagging, synced advertising, instant purchase, limited ad skipping and skipping options. Additionally, dynamic ad insertion technologies such as Sky’s Adsmart are targeting customer segments by replacing broadcast adverts in PVR recordings.
However, it is not clear how effective these new techniques may be or if there are other solutions that can improve engagement and provide compelling options for advertising budgets.
For example, can the popularity of social media be exploited to build brand equity through recommendation and advocacy? Dan Biddle of Twitter reckons 60 % of the UK’s twitter users tweet while watching TV -how can this engagement be directed to advertising or engagement? Moreover, companies such as Civolution are delivering solutions for syncing Facebook and TV commercials
Challenge Description
We would like to know how operators, advertisers and technology providers can engage consumers in a rapidly changing TV world – ensuring interaction with brands across devices and media, both in and outside of the home.
We want you to tell us, in relative terms, how effective you believe non-traditional TV advertising solutions are at engaging viewers. We would then like you to propose one or more alternative TV advertising solutions for TV Everywhere (digital), Video On-Demand and recorded (PVR) content that provide demonstrable improvements in engagement over current techniques.
Finally, we’d like you to demonstrate how your proposed solutions address the behavioural differences between current and emerging consumer segments – from Baby Boomers to Millennials.
