Cynopsis That BIG Takeaway 2020 – Executive Summary
FRIDAY SEPTEMBER 25, 2020
That BIG Takeaway 2020
Cathy Applefeld Olson
Big industry insights. Big innovation. Big energy. Cynopsis’ Big TV Virtual Experience—sponsored by Gamut TOTAL—delivered 40-plus panels, sessions and executive briefings to more than 1,500 attendees at home. A lucky few also won prizes provided by our sponsors: An Apple watch, headphones, a year of treats from Fruit of the Month club, a Nespresso maker and last but not least, a big TV.
And because Cynopsis is also about building community, the three-day event was Big on bonus content: From movement with Soul Cycle instructor Victoria Brown to staycation advice from travel expert Oneika Raymond to style tips from four-legged Instagram icon Tika the Iggy and insight slides from Vevo; from NY trivia sponsored by NYI to a tour of Discovery’s Urban Oasis to a tasty cooking demo with executive chef Fabio Viviani, sponsored by Gamut.
Here are the top lines and key executive insights, panel by panel, from the conference:
UP CLOSE & PERSONAL: PLUTO TV
With 26.5 million monthly active users, more than 250 curated channels and 100,000 programming hours, Pluto TV is riding the premium AVOD wave that turned former conventional wisdom about both ad-supported and linear TV on its ear. “It’s hard to remember how dismissive the industry was about ad-supported premium video just five or six years ago,” said Jeff Shultz, Pluto’s EVP and chief business officer. “The thinking at the time was subscription models were going to squeeze out advertising… and advertising would die.”
International growth—Pluto is now in 22 markets with Brazil and Spain on tap—is a key benefit of being purchased by Viacom last January. What’s contributed to its boom in Latin America, where the service is available in 17 countries? “It’s not enough to just look at how big a market is or how many connected televisions they have, you need to understand how consumers are consuming video, and Latin America was particularly well-suited for a free streaming service,” Shultz said.
THE 2021 IMPACT OF AVOD ON TRADITIONAL MEDIA
According to new Tubi research, one in four Americans ages 18-34 have canceled a SVOD service in favor of an ad-supported service, and 37 percent of those consumers would be willing to try a new streaming service with ads in order to sample new content. Will the ads be there in volume?
On the rebound: “I’ve been a little surprised by how quickly the ad market has rebounded… it started coming back for us in June and is now on a tear… Advertisers had to make decisions very quickly, and because we learned from that, those learnings will carry on going forward.” – Mark Rotblat, CRO, Tubi.
Q4 crystal ball: “I think advertisers are now better prepared in terms of how they’re going to manage their spend and I don’t think there will be a retreat from the market even in light of a second [Covid] wave. Everybody’s smarter.” – Mark Garner, EVP, global content sales & business development, A+E Networks
WHEN BRANDS GET ADVENTUROUS
Like a good neighbor, The Weather Channel in partnership with State Farm last year launched an immersive mixed reality safety campaign from its home studio ahead of Hurricane Dorian.
How did it go? “A lot of what we do together is based on how aligned our brands are,” said Barbara Beckendahl, Weather Group president of ad sales. “I don’t think sticking an advertiser in these IMR scenarios would resonate if it wasn’t for the fact that State Farm and the Weather Channel have worked together for years to help prepare people for any kind of weather conditions. That trust has been the foundation.”
Brand lift tsumani: The end game is also about ad performance. Combined with the IMR activation, State Farm ads on the network garnered a 45 percent lift in commercial recall. Sue Beigie, marketing director at State Farm, emphasized the companies’ shared values. “The technology the Weather Channel brought is such a natural extension, combined with those values we have of making sure people are safe,” she said.
SOLVING FOR BRAND SAFETY IN A CONNECTED TV WORLD
Brand safety, especially on social platforms, remains an issue. The Global Alliance for Responsible Media offers a solution. “One of the media challenges of the decade is to keep harmful content under control on social platforms. We felt it was fundamental not only to bring advertisers together to work on that, and their agencies, but also to include the platforms too—to ensure all the key stakeholders were around the table.” This from John Montgomery, EVP of brand safety at GroupM, co-founder with Mars Inc. of GARM.
Tony Squires, global commercial media director at Mars, one of 100 members of the group along with Google, HP, Lego, Mastercard and others, said, “The reason we focused around social media platforms is we knew it was going to get increasingly more difficult for our customers to have a safe environment to communicate with their friends, to get information, to understand what’s going on in the world.”
WHO WILL WIN AND LOSE IN 2021 – ELGIN THOMPSON
“Brands, spending $14.1 billion in 2023… will they be getting their money’s worth? What is the ROI on that ad spend? Therein lies the issue—it’s measurement,” said Elgin Thompson, managing director, technology investment banking, JMP Securities. “When agency executives were asked what are the primary challenges to cross-screen video advertising for connected TV, over half cited a lack of standard measurement. Therefore, even if the audience accepts some form of AVOD, the advertisers themselves might lose.”
PROGRAMMING SPOTLIGHT: LIFESTYLE
“When I think of reality TV, I don’t think that’s what I do at Food network or HGTV or TLC. It’s more that I do real TV. Real people, real scenarios, real talent. That’s where it all begins. That realness is what causes people to come back and makes a show a hit.” – Kathleen Finch, chief lifestyle brands officer, Discovery.
THE NEW POWER OF LOCAL OTT ADVERTISING
OTT offers advertisers a way to connect locally at scale. But how to get linear advertisers over the hump of buying OTT? “Local and regional buyers are used to buying linear TV on a direct basis, and as a result the ease of purchasing OTT in the same fashion resonates with them,” said Anthony Greene, VP of programmer partnerships at Gamut. “While recognizing OTT is a digital medium, these linear buyers also cherish brand safety with quality programming, and what this allows them to do is have that confidence they are buying those same media outlets, that same quality.”
“We’re still operating in a pretty confusing marketplace, where we lack some standards and consistent reporting across platforms,” said Bill Murray, VP of programmatic solutions at Discovery Inc. “But the reality of there being an ability to apply digital-type targeting options have improved reporting… it’s a pretty easy sales proposition, it just requires more education.” Raoul Marinescu, VP of revenue partnerships at Pluto TV, added: “We position ourselves as an extension of any cable network that we present on Pluto… It’s just having the conversation with the buyers and educating them, and having that consistency.”
FUTURE OF UPFRONTS
It was three thumbs up from panelists Mike Law, president of Amplifi US | Dentsu; Jon Steinlauf, chief US advertising sales officer at Discovery; and Matt Sweeney, chief investment officer at GroupM, when moderator David Cohen, CEO at IAB, asked whether the Upfront will be back next year. Among other insights:
CTV is the belle of the ball: “The agency holding companies made a big leap this year from linear to streaming, a sign of getting ahead of the curve. Those of us on the content side have to accelerate our plans,” said Steinlauf. “We’ve got to follow those eyeballs. We’re aggressively migrating along with the consumers because we’ve got to get where they’re spending their time,” said Sweeney. Law noted the industry is moving at pace. “My call out is we don’t want to move too fast. There are still things to solve for in terms of measurement, ad load and frequency.”
The case for the Upfront: “We saw a surprisingly strong Upfront marketplace even at a time of uncertainty. It reflects the efficiency and longevity of the upfront buying system,” Steinlauf said. “If you skip year and decide to go scatter, that doesn’t automatically guarantee you your base back the following year.”
Digital dominance: “Digital is definitely the story this year. This is the third year in a row where we doubled our digital commitment,” Sweeney said.
THE CURATION EQUATION
Advice for launching a niche service: “Be very clear about what your content offering is,” said Jennifer Stamm, head of marketing at Haystack News, which recently rebranded from promoting itself as an ad-supported OTT service to specifically branding as an OTT news source that customizes feeds for each viewer.
Data drivers: “In terms of content providers, the data-driven approach definitely resonates… Platforms need to take a really robust look at what the consumer is asking them for, and flex and adjust based on that input,” said Alden Mitchell Budill, head of global partnerships and content strategy at Crunchyroll
More is more: “As an SVOD service, I want all platforms to be successful. At the end of the day, the more distribution, and more competition among distributors, the better off the content creators are,” said Emily Powers, CRO at BritBox. “We want as many options to get our content to our end users in whatever form they want.”
WHO WILL WIN AND LOSE IN 2021 – LYLE SCHWARTZ
Is there actually tension between OTT and linear? Not so much, according to Lyle Schwartz. “It’s about video… how the advertiser is using video to the get right message to the right consumer at the right time,” said the former CIO and president of trading at GroupM. Among other candid Schwartz insights:
On data: “The data and research guys need to step forward. We need real, holistic measurement. You can’t rely upon different groups in the industry trying to come up with convergent definitions. We need to have as best we can, one definition. You can’t ask buyers to keep converting. “
On measurement consortiums: “They are all skewed in one way or another. Maybe it’s time for the advertisers to take greater control. It’s their money; they can start saying what it is they want.”
On where advertisers should put their money: “Video is a tremendous asset but I wish it were much broader. Newer video options would give buyers, agencies and clients the ability to be more creative. I was hoping this year would show a lot more creativity than I saw.”
UP CLOSE & PERSONAL WITH BYRON ALLEN
A “Black unicorn.” That’s how the founder/Chairman/CEO of Entertainment Studios/Allen Media Group describes himself. And it’s a “shameful” place to be in 2020, the mogul said. “When I sued the cable operators because they were not doing business with Black-owned media… those cases went all the way to the Supreme Court, and we settled those cases because it was something that needed to be done,” he noted. Of late, Allen has been turning his lens to Madison Avenue and what he sees as a lack of support for Black-owned media. “I speak very clearly to Madison Avenue, making sure they know they have a long, deep history of systemic racism.”
PROGRAMMING SPOTLIGHT: NEWS
Trend alert: Younger viewers are flocking to news. Fox News hadn’t done much business with quick service restaurants, but after the outset of the pandemic “within one month we signed six new QSR advertisers, and many of them signed long-term Upfront commitments,” said Jeff Collins, Fox News EVP of ad sales. “They’re projecting the younger audiences will stay with news at least another year.”
Bridging the generation gap: “Younger viewers and more and more older viewers are engaging across platforms, so table stakes are you have to be everywhere,” said Susanne Mei, SVP, CBS News Digital. “We do a lot of research and we’ve learned our viewers are very interested in the climate, science, and one of the things they look to news organizations for is to learn new things, to be educated.” As a result, CBSN launched a series of weekly mini docs.
Safety first: “We’ve had to learn how to cover news in a completely different way, and we’ve learned a lot about the safety of our own teams,” said Wendy Fisher, VP, news gathering at ABC News.
HOW VEVO BECAME A MODERN-DAY GLOBAL MUSIC TV NETWORK
It may have started as a YouTube-focused programmer, but these days Vevo looks a lot like a TV net. The channel soon will pass 3 billion CTV views, and as it moves from a YT-first ecosystem, strategies are changing. “In a linear world, we get to handpick the content more often and in different ways,” said Rob Christensen, VP of sales strategy and partnerships. “We cannot assume the same audience exists on Roku that does on Samsung TV Plus or Xumo. We’re trying to strategically program for every audience uniquely across multiple CTV platforms and genres so we can create a one-to-one addressable programming experience.” Christensen noted “advertising works” on Vevo. “Our audience is incredibly receptive to ads.”
THE CHANGING MULTICULTURAL AUDIENCE
Get with the program: “We need programs in place to make [change] happen. One program I’m excited about is the 15% Pledge—first it was beauty space, we want to make sure you have 15 percent of shelf space dedicated to Black people and people of color. And from there they emerged on other platforms, so Yelp has jumped on, West Elm has jumped on.” – Jessica D. Lane Alexander, co-founder/head of digital content and marketing at Pop’N Creative
Aha moment: “At NBCUniversal, of the biggest issues we found is our businesses are mostly located in LA and New York. LA and New York are expensive cities, and so we’re going to launch a program for entry-level jobs where people can apply for student loan relief as well as up the housing opportunities for young applicants so we can get people who are not coming out of school with a huge wallet and a traditional background.” – Peter Blacker, EVP, revenue strategy & innovation, NBCUniversal Telemundo Enterprises
Broaden your lexicon: “I don’t think the multicultural audience is changing as much as programmers are catching up to where we are. One key insight many people realize is that despite the fact that we may speak the same language, in particular as African-Americans and acculturated Latinos as well, it doesn’t mean we mean the same thing. If I say, ‘Alright, alright, alright,” I’m thinking Kevin Hart, whereas a lot of people may be thinking Matthew McConaughey.” – Rahsan-Rahsan Lindsay, EVP, ad sales and marketing at TV One
Same conversation, different year? “The only way this conversation will change is if you have a diverse sense of thought at the top and throughout the organization. It brings a more holistic marketing campaign vs. doing it in a silo.” – Dametria Mustin, global marketing VP, PDC Brands/Cantu
UP CLOSE & PERSONAL: NY INTERCONNECT & CARAT CEOs TALK SHOP
What did the unexpected events of 2020 impact? “Basically everything”, said Ed Renicker, CEO, New York Interconnect, in this candid conversation. Carat undertook ongoing research, The Covid Crisis Navigator, to better understand what people were going through, and what they were looking for. “Initially it was pure shock and it was important for brands to have that empathy and understanding. That’s why we saw way too many of the sympathetic ads with piano music in the background,” said Angela Steele, CEO, Carat. “That phase didn’t last for long and people shifted to survival ode and value was most important to them. We’ve since seen people move from survival to the new normal.” Renicker noted, “How long do they stay on that current message? It seems most are starting to get back into the general branding and away fro the empathetic messaging.”
WHEN BRANDS CHOOSE ACTIVISM
OWN’s partnership with Dove and the Joy Collective to push the Crown Act, legislation designed to end anti-hair discrimination, so far has seen seven states sign on.
A call to action: “We’ve never thought of this as marketing, we’ve thought of it as unlocking the impact on the community. Over-serving the underserved.” – Esi Eggleston Bracey, EVP & COO – NA Personal Care, Unilever
Power in numbers: “70-plus organizations have come together to support this work and stand for hair justice. Putting together an alliance of partners has been critically important. Being able to do something meaningful that really impacts lives beyond selling a product – that’s a marketer’s and an agency’s dream.” – Kelli Joy Richardson Lawson, CEO, Joy Collective
A campaign with vision: “Nothing builds brand loyalty and a sense of connection than saying, ‘I see you. You matter.’” – Sheereen Russell, group VP, advertising sales & client Partnerships for Inclusion Audiences, OWN – The Oprah Winfrey Network
PAIN POINTS IN CTV & MEDIA
“As the number of CTV-rated apps continues to grow, there is more fragmentation in this space. The data does tend to get silo’d within those platforms, and we have to think about the best way to provide a holistic view that isn’t duplicating any audiences,” said Kim Gilberti, SVP, product management, Nielsen. Noting streaming now constitutes 25% of total usage in the US—“a pretty giant chunk when you think about it,”—Gilberti said, “We believe the patterns we’re seeing due to the pandemic are not temporary. They’ve shown us viewing behavior is shifting, and connected TV and streaming are the present and the future.”
Nielsen finding: Currently more than 75 percent of US homes have at least one or more connected devices.
WHO WILL WIN & LOSE IN 2021 – LAURA MARTIN, CFA & CMT, NEEDHAM & CO.
Winners: AVOD. “AVOD wins the most because connected TV ads have full-screen takeover, nearly a perfect substitute for television, much less clutter, and ad targeting.” Also, anyone with access to premium ad avails. “Having an AVOD choice lowers the cost of entry to entering SVOD…. Everything is on an addressable basis, driving CPMS up, but ad avails are falling at the speed of light.” And videogames. “The demos are hard to beat. Men and women 18-34 are both on mobile videogames or video games in general, so advertisers being able to follow them to video games are winners.”
Losers: Sponsorships. “Lots of media revenue is driven off in-person and then the ancillary affect… so these physical silos in media [sports, live music, live events], we think this goes away forever” due to the pandemic.
UP CLOSE & PERSONAL WITH MASTERCARD
Top of mind for Ben Jankowski, SVP, global media, Mastercard? “Cross-media measurement. If we can’t measure across platforms, if we don’t have a consumer experience where we can understand how often viewers are seeing a certain message… we’re still going to have frustrated consumers. Consumers are still avoiding ads at record levels because we haven’t created a good enough experience for them.” Regarding CTV and OTT, “They are going to get more money from the marketplace than they have before. The consumer experience drives that,” he said.
FUTURE OF TV AND ADVERTISING
Form factor: “My biggest focus is the FAST, free ad-supported television systems. That’s where the most growth is happening on television. In those cases, the movie icon is one icon away from the news icon. A lot of people decide, ‘Let me get a quick dose of what going on in the world, and then they turn around and watch more long-form content,’” said Jon Steinberg, president, Altice News, and Advertising, Altice USA.
Cheddar vs. News 12: “What makes Cheddar different is everything other than the fact that it’s anchors at desks and locations. We try to present content fast, and in a nonpartisan, objective fashion,” Steinberg said. “News 12 has a more traditional local format. Community affairs, schools, crime, weather—a steady mix of that diet in every 30-minute wheel we provide. Cheddar has much more flexibility.”
a4 Advertising focus: “OTT and branded content, custom shows. We do segments for Dunkin that typically involve product integrations. Those are high-impact and unique.”
REACHING TARGET AUDIENCE
For the record: There’s a lot of misnomers and false narratives out there, one of them being we’re seeing 15 to 18 percent erosion. No, we’re not. That’s on a narrow antiquated demo set. We are still stuck with legacy demos that make no sense. We have to make the total audiences the primary audience. Niche targets have to be the secondary.” – Peter Olsen, president, ad sales, A+E Networks
Client-specific: “There’s lots if interest in connected TV, lots of interest in audience targeting—although the mix is different for every single client. We spend a lot of time talking to advertisers and agencies trying to figure out what mix is right for them.” – Beth Rockwood, SVP, ad sales research, WarnerMedia
PROGRAMMING SPOTLIGHT: REALITY
Are brand extensions of series even more important than ever?
“If you have equity in a subject-based format, it’s often a good thing to build on that equity. But you also have to be careful about overdoing it. At what point are you pushing the envelope too much? The holy grail is always fresh new flavors.” – Alon Orstein, SVP, Production & Development at TLC
“You can’t just spin it off to spin it off. It has to be led by creative. I don’t think it ever changed, but there was such an urgency [during Covid] we had to pull ourselves back and say, Let’s figure out how to do the brand extension but do it smartly and not rush it.” – Adam Reed, CEO, Thinkfactory Media
BLACK-OWNED NETWORKS: TWO TITANS TALK
“The problem in the Black community is that the ideas exist, the vision exists, the work ethic exists… what doesn’t exist is access to capital… The definition of ownership is control. If you don’t own it, you don’t control it. So the idea of black ownership is critical.” – Robert L. Johnson, founder/chairman, The RLJ Companies; founder/former chairman of Black Entertainment Television
“The talent in the black community is enormous, if we’re given the opportunity to play the game… I ended up owning 100 percent of my company because no one believed in me, and no one invested in me. What I went through for the first 30 years, no one should have to go through.” – Byron Allen, founder/Chairman/CEO of Entertainment Studios/Allen Media Group
THE FUTURE OF TV IS CROSS-PLATFORM + ADDRESSABLE
Discovery’s new cross-channel ad product: “OneGraph: launched in July and has been very well received in the marketplace. We can have one unified audience target, through our cross-platform identity graph… What’s really important is measuring your incremental reach.” – Sam Garfield, VP, data strategy & advanced audience platforms, Discovery
Hello 2021: “This will get easier. 2021 is going to be a huge transition year for traditional television… programmer addressability is finally here, so I see that accelerating. It’s impressive to see how far we’ve come in the last five years, in terms of embracing technology and data. We’re close to the time when the lines will blur between digital and linear.” – Steve Silvestri, VP, advanced advertising, Discovery.
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