It has finally happened – at least in the UK. GroupM reports that video streaming has just overtaken free-to-air TV. But that could be to do with the dismal wet days in Mother England.

GroupM (webite here), the media investment group of WPP, has a new report, “State of Digital,” offering intelligence on consumer media consumption and advertising investment trends worldwide.

It says that in 2018 consumers will spend an average 9.73 hours with ‘media’, up from 9.68 hours in 2017. Online streaming will overtake time spent with linear TV for the first time, globally, in 2018.

Average hours 2015 2016 2017 2018
Online 2.7 3.19 3.53 3.69
FTA TV 3.78 3.76 3.71 3.63
Print .68 .66 .70 .68
Radio 1.67 1.71 1.74 1.73
Total per day 8.83 9.31 9.68 9.73

On average across reporting countries, 47% of online display investment was transacted programmatically in 2017 versus 44% in 2017 and 31% in 2016. Programmatic means that a computer (A.I.) matches viewer profiles with advertisers for maximum return on advertising dollars spent.

What GroupM advertisers view as hot for 2018 and beyond

GroupM also surveyed WPP’s vast network to better see the forest for the trees on industry hot topics. The responses below are from ‘clients’ – a.k.a. advertisers

Blockchain:

So far, there is scant evidence of practical application. “Blockchain’s main attraction is its distributed ledger which tells everyone everything and thus presents the opportunity to reduce inefficiency or cheating. However, its Achilles’ heel is the need to keep every participating computer updated with everything all the time, and that’s too slow for a real-time world,” states Adam Smith, GroupM’s Futures Director.

AI:

Conversely, respondents reported ample development and scaled deployments with Artificial Intelligence (AI). “Arguably, today’s most advanced marketing tools are the advanced algorithms helping brands analyse which creative or media placement is performing the best, at scale and speed,” states Smith.  “Among many future applications, we expect AI to helpfully emerge in fighting fraud that evades conventional rules-based solutions.”

Data:

Regarding marketer application of data to media investment, respondents cited ample room for improvement. Clients are increasingly aware of the value of owned/acquired data, but are often risk-averse to harvesting, storing and distributing it. In many smaller countries, available data is poor. Most U.S. clients are using first-party data to activate digital media, and they’ve frequently invested in enterprise data management platforms (DMPs). Other markets are not so far along for varying reasons. Marketers most often using first-party data are performance-oriented, e-commerce driven, and typically in auto, travel, hospitality, banking, or sometimes supermarkets with well-managed end-point of sale systems.

Digital video competition:

Because measurement of premium video audiences across platforms is woefully inadequate in every market, GroupM asked respondents to simply estimate the share of TV incumbents versus digital insurgents. Legacy TV players hold 75% of all video hours versus 29% online video hours.

Metrics & viewability:

Constituents reported some industry works-in-progress to enhance measurement of omni-platform video audiences. Viewability continues to be debated with some contrarians suggesting 100% in-view ads in mobile environments can sometimes be intrusive and can be negative to consumer experience and thus brands.

Price inflation:

Respondents cited two inflation drivers: high demand for premium, brand-safe content and poor measurement of OTT and mobile platforms; the scarcity of measurable inventory drives up prices.

The “duopoly:”

Google and Facebook continue to be the key growth drivers. Google search is critical to clients, and YouTube is increasingly important for scaled, “premium” video. Concerns over the quality of programmatic inventory in the Google Display Network persist, but remedies are being pursued.  Facebook’s success is partly due to the delivery of younger audiences via Instagram. The surge in large-advertiser investment in 2016-2017 also helped double Facebook’s share of digital investment ex-China.

“Automation and talent are the big themes in advertising’s current revolution,” said Kelly Clark, CEO, GroupM Global. “One of the downsides of specialisation is the increase in specialists who know more and more about less and less. We have to use automation to liberate brain-power, so talented people can look across the entire media ecosystem to help clients optimise short-term results and create long-term brand value.”

GadgetGuy’s take – I found GroupM findings interesting

What the research shows is that we are moving to online streaming to the detriment of free-to-air TV and to a lesser extent print and radio.

What that means is that advertisers are scrambling to get the best value in the uncertain world of online. Google and Facebook know so much about you that they dominate the programmatic landscape.

At LG’s 2018 TV launch Angus Jones General Manager of Marketing said that 7 million Australian’s use Freeview now to stream both catch-up TV as well as live HD TV instead of over-the-air. NBN speeds and unlimited data packages have enabled that. Also, 66% of Netflix viewing is on a large format screen (not mobile).

But this means Google and Facebook know who you are (because you use internet IP) and can serve ads accordingly. Free-to-air is anonymous – viewer metrics can come from smart TVs. FTA cannot serve individually targeted advertisements – yet.

If you are interested in this phenomenon Screen Australia (Australian Government) has an interesting 2017 report to download here.