Reflecting on the changes we’ve experienced this year in the TV advertising industry, I couldn’t help but look back at what we at EDO expected in our 2023 industry predictions nearly a year ago. Eleven months, two Hollywood strikes, a Cableland crisis, lots more streaming sports, and (ahem) some big EDO milestones later, I can honestly say this year has been momentous — filled with surprises and learnings that continue to inform our perspective and grow my confidence that we’re on the right path.
While there had long been rumblings of a writer’s strike, I don’t think anyone was expecting both the writers and actors taking to the picket lines at the same time and for so long, freezing the gears of TV content production through half of the year. On the bright side, the predicted economic recession that inspired brands to cut their marketing budgets never fully materialized — or at least it hasn’t hit yet (watch those interest rates!).
Amidst all this change and turbulence, our team at EDO has held fast to a guiding principle, which our Chairman Edward shared publicly during this past Upfronts season: “The industry is signaling really clearly that ad-supported streaming is going to supplant linear ... and that within that new frame, outcome measurement is going to rule.”
2023 was the year that we finally hit that tipping point we’d been building toward: Our ad-supported, streaming future is coming into focus, and a growing number of big industry players are ready to go beyond just audience and realize the power of knowing the real-time impact of their CTV campaigns
With all that in mind, here’s our 2023 predictions recap: the three things our team at EDO learned about the TV advertising industry in 2023 — and two things we already knew.
2023 Prediction: Ad-supported streaming continues replacing linear TV — with live sports at the center.
VERDICT: Nailed It.
2023 was a landmark year for ad-supported streaming. The ad-supported tiers of Disney+, and Netflix, both launched in late 2022, have now climbed to 5 and 15 million subscribers, respectively. When Amazon announced that it would bring ads to TV and movie content on its Prime Video Service in September, it left Apple TV+ as the only major streamer that is mostly ad-free...for now.
Meanwhile, virtual cable bundles (or vMVPDs, for the acronym-inclined) like Hulu, and YouTube TV continued to gain market share — with a little fall boost from Charter’s ESPN carriage fee dispute with Disney. That last part is important because even in the new world of ad-supported streaming, live sports remain at the top of the food chain.
Sunday Ticket on YouTube TV has been a huge success, Netflix is testing the waters with the Netflix Cup tournament, and viewers of Amazon’s inaugural Black Friday NFL game were 78% more likely to search for brands or products advertised than viewers of ads on competitive Thanksgiving games. And that doesn’t even take into the streaming sports innovation happening with platforms like Fubo and Paramount+. Game, set, match.
2023 Prediction: Streaming is the new local.
VERDICT: Getting there…
While there’s growing evidence that ad-supported streaming IS the future of the business, many brands are already leveraging it to complement their national linear TV buys with smaller, more targeted buys.
In 2023, we predicted that streaming would become the new local, and we’ve since heard this little turn of phrase repeatedly on the industry conference circuit. In GroupM’s mid-year forecast, the agency estimated that, by the end of this year, Connected TV advertising spend will have grown by 13.2% globally to $25.9 billion.
2023 Prediction: Congress will create new privacy laws to regulate big tech.
VERDICT: Nope.
At the beginning of 2023, we all hoped Congress would finally come together to regulate big tech — to govern how our industry collects and implements consumer data. Well, no one ever went broke betting against the U.S. government.
In Congress’ absence, California led with the implementation of the California Privacy Rights Act (CPRA), and a number of states followed suit with their own legislative activity. Through a mix of altruism and self-interest, tech companies have also stepped up to fill the void, with Google planning to kill off cookies for a portion of its user base in Q1 2024. With AI racing in to take all the headlines, the government can’t afford to be asleep at the wheel when all your their our data is at stake.
2023 Prediction: Repeating ads will go away.
VERDICT: Getting there…
Last year, I predicted 2023 would be the year our industry managed to weed out the repeated ads that air on streaming services and drive viewers up a wall. While these repeated ads remain a problem, increased advertiser demand for streaming inventory is a key step toward eliminating them — and results-oriented marketers are already taking steps to adjust advertising frequency for maximum performance.
At EDO, we’ve been working with clients like The University of Phoenix to implement our Creative Rotation Optimization™ solution, which enables advertisers to see exactly when a TV ad starts to lose its ability to drive consumer engagement.
2023 Prediction: Nielsen’s not going anywhere — for now.
VERDICT: Nailed it.
Even before we announced our partnership with Nielsen in June, we were bullish on Nielsen’s ability to survive the noise from rival currency providers. Since then, our industry is not just surprised, but relieved by how resilient Nielsen has been to these challenges.
A year later, there have been some experiments, but Nielsen remains the dominant currency for buying and selling Convergent TV ads at scale. In speaking with clients throughout the year, we’ve learned that Nielsen’s workflow and systems are quite sticky for longtime users who are excited about our partnership’s potential to deliver an interoperable workflow for media planning based on audience and outcomes. We believe an open and partnering mindset — versus an adversarial one — is what our industry needs to truly innovate and thrive.
Predicting what 2024 has in store?
VERDICT: Coming soon…
As Hollywood gets back to work, we’re looking forward to the return of our favorite TV shows, new films, and another year of helping measure and optimize the great ads that fuel creativity. We predict more than a few interesting developments in the year ahead, but that’s another post. Stay tuned...