Global Ad Trends: AVOD luring brands and viewers from linear TV

Advertising spend on broadcast TV (excluding political ads) fell by $34 billion in 2020, as pandemic-induced restrictions halted TV productions and brands turned to streaming with the AVOD market set to double by 2025 to $54 billion, per WARC’s Global Advertising Trends: Next Generation TV.

Why it matters

Broadcast’s loss was mostly AVOD’s (ad-funded video on demand) gain, as brand investment in streaming platforms grew by 9.9% to $26.7 billion. Over the next five years, that investment in the US market – the world’s largest – is set to treble to $24.2 billion.

Commenting on the results, James McDonald, Head of Data Content, WARC, noted that next gen TV is “demonstrating the core traits of offering mass reach for resonant creative in brand safe environments. However, unlike with its ancestor, fraud now poses a very real and present threat to advertising trade, especially among unverified vendors.”

The details

• Investment follows consumers. Over a quarter of US (26%) and UK (27%) viewers are streaming more video at the expense of linear TV. A full third of Americans exclusively stream their video content.
• 2020 was a watershed moment for video streaming. 40% of consumers around the world now have an internet-connected TV, either smart TVs or through a device or console.
• Linear TV is receding, but the TV screen remains king. The biggest screen in the house accounted for 75% of all streamed video time in Q4 2020 across CTVs (49%), smart TVs (17%) and games consoles (9%).
• Mobile matters everywhere, but it’s king in Asia, developing markets. While globally, mobile accounted for the same proportion of streaming time as desktop at 10%, live TV is a different story. YouGov finds that one in three globally watches live TV on their mobile, tablet or PC, but this rises to over one in two in India (57%) and China (54%).