The Live Video Opportunity
October 21, 2016
We live in an era where media can be consumed in a multitude of ways, on a variety of devices. The DVR changed the face of television, enabling consumers to time-shift their viewing and zip through commercials. The internet offers top-quality media content that can be accessed anywhere. But as video viewership continues to increase across digital devices, the thirst for live content is also growing.
How can brands reach an engaged audience willing and eager to view their advertising alongside this unique media experience? Beyond merely getting eyeballs on their campaigns, what is the best method to influence their hearts and minds, and consistently increase brand perception and bottom-line sales?
No Replacement for the Live Experience
As it turns out, in a modern world where many consumers practically live their lives through their digital devices, the solution lies in a concept that predates all electronics: the power and attraction of the live event — the must-see communal gathering that simply cannot wait to be viewed later.
Whether you're watching the presidential debates the presidential debates to your favorite sports matchup, there's no denying the impact that watching live and in the moment creates.
That eagerness for a live connection hasn’t changed, even as the ways in which consumers’ viewing behavior and options are evolving. This combination of a very human desire for live interaction and greater choice in how events are viewed has led to higher consumer expectations.
We expect to be able to live stream concerts, news, financial events, sports and other content seamlessly on any device we choose, and to be able to carry these events with us as we move along our day.
For advertisers, this new paradigm has driven budgets to shift into online video and events that consumers consider important to view live to view live: major sporting events, news, political events, and more.
According to Ad Age, ad spending on general entertainment programming on the Big 4 TV networks actually declined between 2011 and 2015, but during that same period spending on live sports increased by nearly +40%, now representing +37% of the Big 4 networks’ (ABC, NBC, CBS, and Fox) total revenue.
An Increasing Thirst for Video on All Devices
So we know that consumers are looking online for that live experience so many of us crave. But are they open to consuming both content and advertising on their digital devices?
The answer is an unequivocal “Yes.” For a recent study Yahoo asked more than 1,200 online video viewers how much they anticipated increasing their video usage on several types of devices. +55% said they planned to use their smartphone to watch more video than in the past year. While, +48% said the same about their tablet, and +34% predicted greater use of a PC or laptop.
From a monetization standpoint, we see that the greatest growth in ad views is coming from live broadcasts. In Q3 2015, the FreeWheel Video Monetization Report showed that while year-over-year ad view growth for short-form video was only +9% and growth of long-term video was +30%, the increase for live online events was an astounding +113%. While digital long-form and short-form content still commands the lion’s share of ad dollars, live is growing at an extraordinary rate and demands the attention of advertisers who want stay ahead of these industry trends.
Identifying the Live Opportunity
Having established the core human desire to actively view live events, and the shifting preferences for consuming video on digital devices, does this intersection of trends create a significant opportunity for advertisers to reach users in a meaningful way with demonstrable results?
To answer this question, Yahoo took a unique approach and worked with Deep Focus to test three live events using facial coding and a pre/post-online ad effective- ness test. The goal was to determine the differences in advertising impact and content interactions between live events and non-live on-demand experiences from a biometric standpoint. Finally, Yahoo partnered with research firm Ipsos to survey more than 2,000 online users between the ages of 13 and 64 across the United States.
First, Yahoo explored the “why” of live video consumption, specifically looking for that emotional connection discussed above. Not surprisingly, respondents said they want to watch live events on both TV and digital devices because it makes them feel more “up-to-date,” “informed,” "involved," and “connected with the world.”
But the key takeaway was that on each of these attributes, live online viewing scored higher than television, suggesting a stronger emotional tie with live online streaming. For example, consuming live events online garnered +10% higher positive response when it came to feeling “up to date.”
So what is driving consumers to watch on digital devices? Approximately +50% of those surveyed said they prefer online viewing of live events because it enables mobility, the ability to multi-task, and generally is more exciting than TV.
Taking the Event with You… Wherever You Go
With faster connection speeds and larger screens, mobile is now a preferred platform for video viewing. Users say the attributes of their mobile devices have actually become a motivating factor when it comes to digital streaming.
According to data by Flurry from Yahoo “Phablet” owners (devices that could also be classified as large phones or small tablets) report exponential year-over-year growth in their live video consumption, especially in Sports (+427%) and Music / Media / Entertainment (+255%).
Because consumers can now seamlessly watch live online video so easily from their mobile devices, they are adapting their viewing behaviors accordingly. Fully two-thirds of users reported typically watching live online video away from home, significantly higher than those who said they watch either live TV or (non-live) on-demand web content away from home.
As expected, millennials are at the leading edge of this behavior change. They are considerably more likely than older video viewers to watch live online content on mobile devices: 70% of this young adult segment reported consuming live online video on their smartphones, compared to 56% for the general population. Millennials also view live online content on laptops, tablets and connected TVs in greater numbers, but the gap is highest on smartphones.
One interesting side note: While all age groups report that they’re most likely to use PCs and laptops to watch live online content, we expect that as smartphone screens increase in size, we will see even greater usage on mobile devices across all age categories.
The Power of Multi-tasking
Another key benefit to users who watch live online video is the ability to interact with the content in a secondary way: while it is being consumed. Consumers reported that they are more likely to use search, send emails and texts, and monitor and post on social media about the content itself while viewing live online video, in significantly higher numbers than when they are watching on-demand online video or live television.
For example, 60% of respondents reported using search to learn more about the content of the programming while watching live online video, compared to 53% while viewing on-demand video, and only 48% while watching traditional TV. These near double-digit increases were repeated when users responded to similar questions about their use of social media and email or texting to talk about the content while watching live online events.
Simply stated, live online viewing drives conversation and action. People are more likely to want to discuss what they are watching live, whether it’s to celebrate with their fellow sports fans, share a financial tip they just heard, or comment on the news of the day. However, this added multi-tasking is all focused on the event itself, as live streamers are 50% more likely to be focused on the content when compared to time-shifted video viewers.
Excitement and Emotional Response
The third and final element that drives users to live online video is the excitement and emotional connection, which is much higher than on-demand video or traditional TV.
This phase of the research monitored the faces of users as they viewed content and noted when they expressed sadness, anger, fear, contempt, disgust, joy, or surprise. Live online video viewers expressed an emotional response an average of 25% of the time, as opposed to only 17% of those viewing on-demand video.
When drilling down into positive emotional responses (i.e., joy, surprise), those watching live online video had an average rate of engagement of 18% compared to 12% of those viewing on-demand video. More than two-thirds of the emotional responses to live online video were positive.
Stronger Engagement Leads to Greater Ad Effectiveness
So there seems to be little question that consumers have easily adapted to watching live online video events; they exhibit higher levels of engagement, and live video is ideally consumed on the mobile devices that we have with us 24 hours a day — and are interacting with from the time we wake up until the time our heads hit the pillow. So what does it mean for advertisers, and how can they take advantage of this trend?
First, we asked a basic question: How well does advertising fit with the content being viewed? We learned that 48% more users perceived digital ads to fit better with live streamed content than in on-demand content. Most viewers expect advertising in live video, so it's a great fit on digital channels.
Second, Yahoo's research showed that ads viewed during live content drive a greater emotional engagement than those seen in on-demand video. Ads in non-live on- demand programs elicited an emotional response 16% of the time spent viewing. That increased by 75% when looking at the same ads in live online video to an average emotional engagement of 28%. By a wide margin, emotional engagement with ads on live video was far more positive than with on-demand: When viewing the same ad in both delivery channels, users expressed a positive reaction (i.e., joy, surprise) to live video 16% of the time, compared to only 2% of the time while watching on-demand, a 700% increase.
Here’s the payoff for advertisers: The results detailed above have tremendous ramifications for online campaigns, because the positive emotions attached to advertising in live streams deliver significantly higher scores in brand favorability, purchase likelihood, and aided awareness.
This positive halo effect for advertisers on live streaming content vs. on-demand varied from a meaningful increase of 10% in aided awareness, to a 77% percent increase in purchase likelihood and a whopping 481% increase in brand favorability.
For any advertising professional considering what channel will provide the highest ROI, these results provide an inescapable conclusion: live online video viewing offers the greatest opportunity for ad effectiveness, and this trend promises to grow even more pronounced as technology improves and the influence of the tech-savvy millennial segment grows larger.
Live online video offers the best of all worlds to consumers: the ability to take the programming wherever they need to go, a greater emotional attachment to the content, and a greater propensity to share their thoughts with their peers via social media. 64% of respondents said they have already watched a live online video event in the past year, and that number will unquestionably increase.
Yahoo offers the type of daily live programming and special events that consumers are looking to view in real time across devices. Millions of fans have tuned in to watch sporting events live on Yahoo, and the exclusive live stream of Berkshire Hathaway’s annual shareholders meeting on Yahoo drew more than one million viewers.
With its tremendous reach and market leadership in content categories like Sports, News, Finance and Lifestyle, Yahoo will continue to produce and air live content on a regular basis. By taking advantage of sponsorship opportunities on these programs, advertisers are already realizing an extremely effective ad experience.
The bottom line: Users are increasingly expecting to find their live content online, and advertisers who don’t recognize this trend risk being left behind.
Live Streaming: The Next Best Thing to Being There
Billionaire Warren Buffet is known as the “Oracle of Omaha,” reflecting both the native Nebraskan’s homespun upbringing and his remarkable ability to predict the success of his investments. In April 2016, however, Buffet was the “Oracle of Everywhere,” as his firm Berkshire Hathaway’s annual meeting was streamed live across with Yahoo, the first time it has been broadcast in its entirety to a worldwide audience.
Many Berkshire Hathaway stockholders make annual pilgrimages to the Cornhusker State to hear Buffet’s outlook and advice. That same passion for this meeting was reflected in the live stream stats, as more than 1.1 million unique viewers tuned in from across the globe, logging nearly 18 million minutes in total viewing time.
The broadcast also helped the sponsors of the program: advertisers, including a Financial Services company and Scottrade, that recognized an opportunity to reach investors who might not normally view this type of content online. With live programming such as this, where viewers have high interest and are more likely to stay tuned for a longer period of time, the ability to make a positive impression with a captive audience is greatly enhanced.
Case in point: When viewers were asked if they were now more likely to use a Financial Services company for their investment needs, more than half of respondents said they were more likely. This supports a recent Yahoo study around ad effectiveness in live streams, in which 36% of respondents said that they would notice ads more in a live context than in an on-demand context. Furthermore, more than a third said that they pay more attention to live ads, and 31% said that they remember live ads better.
Sponsored content by Yahoo.