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TV Media Planning Media Measurement Future of TV

The most important streaming metric is not subscribers, but time spent

By Tal Chalozin, Chief technology officer

October 3, 2022 | 7 min read

The days of prioritizing subscriber count are over – as they should be, writes Innovid’s chief technology officer and co-founder Tal Chalozin.

Three people watching TV

The shift toward focusing on time spent is well under way / Ron Lach

With streaming video adoption booming (with no end in sight) and one new streaming service after another entering the marketplace, industry stakeholders continue to jump on any news related to subscriber numbers. Of course, we all want to know who’s winning. But what does winning actually look like in today’s streaming world? Isn’t engagement more important for advertisers and content providers than the sheer number of subscribers?

The answer is clearly ‘yes,’ but it can be tough to understand exactly why – and what media owners can do to better capitalize on the opportunity.

There was a time when marketers considered scale a virtue unto itself in streaming. That was valid when an elite few streaming services dominated the marketplace. But that’s not where the business is any more. The average household today subscribes to 4.7 streaming services, per data from Kantar.

Subscriber numbers increasingly look like a vanity metric for a streaming platform. Wall Street investors may be focused on those numbers. But, in advertising-based video on demand, these are not the most useful numbers for marketers – because not every viewer delivers equal value to either the platform or the advertiser. If a platform has a high number of subscribers for the space, it may be limiting user churn. It doesn’t indicate much about engagement. With so many services battling for attention in a single household, time spent tells a more relevant story about the value that viewers are ascribing to various types and sources of streaming content.

For example, let’s say a provider has one viewer spending 120 minutes with the content, and two viewers each spending 60 minutes with the content. The service will likely have an easier time retaining that singular viewer who stays engaged for double the time – and that viewer is likely of higher value to many marketers and campaigns. Warner Discovery chief executive officer David Zaslav was blunt about this in the company’s August earnings call: “We’re not in the business of trying to pick up every sub.”

The shift toward focusing on time spent is well under way – and it’s a good thing. Though it will require some adjustments in business and content strategy to adapt, many of those adjustments will feel familiar. We’re not adding much that the television industry hasn’t seen at some point in the last several decades.

One method is to offer a wider breadth of content within a platform – to cater to different audiences at different times of the day or week. Services can launch new verticals – for example, sports, news, scripted dramas, unscripted programming and kids’ content. Some platforms are creating longer episodes, and more episodes, for their original series.

Another method of adapting is with in-app advertising – which includes the promotion of other content and apps offered by the same streaming provider. The home button on the remote is the biggest fear of a streaming company. Historically, TV broadcasters devoted a great deal of advertising time to promos for their own programming, across any channels owned by that particular broadcast company. Streaming services will need to take a cue from that history. The goal is to keep viewers from hitting the home button, and cross-promotion plays an important role in meeting that goal.

Media owners need to recognize that legacy broadcasters know the cross-promotion game extremely well. There’s a high bar for using that in-app advertising space to keep viewers watching their content. Video publishers need engaging and imaginative ad placements to make promotional ads feel like part of the natural flow of content. They should consider the value of interactive creative formats such as QR codes and product galleries. And they need to understand the power their data holds to help keep viewers engaged through personalized messaging, relevant to factors such as demographic and time of day.

In a mature streaming marketplace – and an increasingly ad-supported one – stakeholders need to grow in their thinking about what the content and the audience are worth. They need to speak the language of marketers and agencies in order to stand out in a crowded field that will soon become even more crowded.

Get to translating – and get to focusing on time spent rather than simply scale. There’s an old line from the linear TV world: the business of TV isn’t about creating the best content; it’s about creating content that’s good enough for the audience to keep watching.

Tal Chalozin is co-founder and chief technology officer at Innovid.

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