Advertising or AVOD is an important and a proven way of monetizing content where a user watches an advertisement in exchange for being able to watch content for free. Each day, billions of ads are shown to users across the world , introducing them to new products & services, while making money for the content provider.
The tech landscape has been changing steadily with an increase in privacy-driven tech decisions, Apple getting stricter on user-tracking, CTV and FAST making a lot of noise, innovations in advertising, and so much more!
What do you think is going to happen in 2023?
Are companies going to spend more on advertising? Or are they going to tighten their strings citing a lack of personalisation and inadequate targeting? What is going to happen to the tech – any disruptive technologies on the horizon?
To get a better idea of what 2023 holds for the ad-tech industry, we talked to multiple experts and thought-leaders to get their views, predictions, and expectations for 2023 and beyond.
OTTVerse presents to you – “AdTech Predictions for 2023 – The Experts Speak!”
If you are an ad-tech enthusiast, please check out OTTVerse’s collection of adtech-related articles, news, and tutorials.
Table of Contents
Prabhvir Sahmey, Senior Director at Samsung Ads
In 2023, we will see the popularity of FAST (free ad-supported streaming TV) services increase, not just in India but globally. Whilst FAST is still a relatively new concept, offered by a few players including Samsung and others in India, the appetite for free content in return for watching ads holds massive appeal amongst Indians and has for many years now.
You can understand the attraction of these services; scheduled programming alleviates the endless search process, but still provides on-demand content for the right moments – all at no cost to the viewer.
Samsung’s own FAST service, Samsung TV Plus, is already seeing incredible take-up come to fruition with viewing time up 218% YoY between October 2021 and 2022 in India.
Beyond what 2023 holds for the Indian TV watcher, the landscape is also set to be disrupted by changing media plans as more advertisers embrace CTV and its possibilities.
They are starting to bust silos across digital and TV teams, because they know barriers must be broken down to effectively boost communication and allow digital thinking to be applied to TV campaigns and vice versa, streamlining spending, investments and exposure.
Reach has been a staple of TV for brands, but in an increasingly fragmented landscape, some consumers are harder to reach through traditional channels. Marketers now have to think beyond cable and consider how incremental reach can help capture viewers across both cable, OTT and CTV campaigns.
Srinivasan KA, Co-Founder and CRO of Amagi
The streaming and media landscape is one of continual change. With today’s plethora of streaming options available, the recent surge in popularity of lower-cost offerings, and a recession squeezing consumers’ wallets, viewing habits are undergoing serious shifts. Meanwhile, streamers, content owners, and advertisers are leveraging new technologies to adapt, finding ways to streamline operations and maximize revenue in a hyper-competitive market.
Here are a few predictions for what’s to come in the world of streaming and media technology in 2023.
FAST TV will continue its meteoric rise
As viewers seek more affordable entertainment options in the midst of a recession, the momentum of ad-supported platforms will only continue to build.
In 2023, FAST (Free Ad-supported Streaming TV) will become the entry point for every pay TV provider or app-based content provider as ad-free TV becomes the content consumption model of choice for consumers. We can also expect to see FAST expand into new types of programming in the coming year, including original programming and premium sports.
Unified solutions for cord-cutting will dominate the media technology landscape
As consumers increasingly move to streaming services, companies will seek unified technology solutions — single platforms that offer end-to-end solutions for everything from creation and distribution to monetization. In particular, cloud-based solutions will see a boost in adoption, chosen for their ability to streamline and simplify every stage of production, including channel creation and management, and monetization through dynamic ad insertions.
Advertising innovations will create new opportunities to maximize monetization
2023 will bring increased adoption of new and innovative advertising formats to help content owners reach their monetization goals without disrupting the viewing experience. With ad formats like contextual ad placements, graphic overlays and dynamic brand insertions, content owners and platforms can place relevant ads unobtrusively into their video streams, delivering targeted messages while avoiding unwelcome ad breaks for the user.
Laura Quigley, SVP (APAC) at Integral Ad Science
Outcomes and Sustainable Practices Will Shape Retail Experiences in 2023
The pandemic has been one of APAC’s biggest growth catalysts for omnichannel retail, with online sales expected to reach US$2.8 trillion by 2025, according to eMarketer data.
The continued growth in e-commerce, complemented by voice search, AR functionality, AI chatbots, and visual search – will be essential for businesses. Online shopping offers enormous convenience, as it can be done anywhere, anytime, making just about anything available to us without leaving our homes.
It also lets retailers learn a lot about us as they track our customer behaviour and combine it with data from other online sources to build a detailed view of who we are and what we want from our shopping experiences.
As brands increase their e-commerce offerings, optimising digital ad strategies that drive real-world business outcomes will be crucial. According to the H1 2022 Media Quality Report (MQR) by Integral Ad Science (IAS), APAC markets were among the top brand-safe markets worldwide for desktop display.
In Singapore, brand risk across display declined for desktop and mobile web users. This shows that the region is a viable environment for digital advertising if brands and advertisers invest in media quality – ensuring their ads are shown to real people on safe, reputable sites or alongside relevant content for greater brand memorability.
Sustainability has become a top priority for many consumers, and retailers are responding. They are trying to reduce their impact on the environment. A Deloitte report showed 55% of consumers bought sustainable products.
More and more brands are developing sustainable strategies. They’re ramping up efforts to reduce their environmental impact, switch to more efficient technology, ensure the well-being of their staff, and conduct business responsibly and transparently. In 2023, brands that don’t prioritise consumer experiences and sustainability will be left behind.
Anand Gopal, Co-Founder and COO, Voiro
In an already interesting and dynamic industry, 2023 promises to be a strange, yet crucial year for OTT. It is a year of great contradiction. On the one hand, consumers have shown that streaming and content are the way of the future. On the other hand, the markets are becoming increasingly clear that growth-at-all-costs is not a model that will drive shareholder value.
This is the year that will probably see the world economy bounce along the bottom of the barrel a few times before recovering.
Funky f/x trends, war, layoffs, a global supply chain crisis and embers from the pandemic will result in a combination that will leave our industry wondering which way is up. The important differentiator for OTT players is two fold – sustainable business models, and optimizing for users’ attention through quality content.
On the plus side, parts of the global OTT advertising industry continue to look strong. Digital ad spend will push well beyond the 50% mark, bringing a significant portion of global ad dollars into the data driven ecosystem.
This is going to be the year of CTV, especially outside the US. Netflix, YouTube and Disney have shown the way with truly hybrid revenue models across subscription, ad supported, and completely ad driven – including password innovations at a household level.
One thing is for sure – 2023 promises to be a year where the content experience will continue to pamper us consumers, with multiple apps vying for that most valuable currency of all – our attention.
Anda Tanchuma, Senior Product Manager at Viaccess-Orca
In 2023, advanced addressable TV will continue to thrive. We expect advertising revenues to match pay-TV revenues in most parts of the world, as advertisers are able to target specific audiences and measure the effectiveness of their advertising campaigns with more precision. This trend is not only growing for traditional TV offerings but also for FAST channels.
While the global consumption of SVOD services rises, growth will be even higher in the AVOD space. According to Statista, AVOD spending in the U.S. is set to surge in the next few years, surpassing $24.2 billion by 2025, as new services are launched domestically and internationally.
The pivot toward AVOD will have a significant impact around the world, opening up additional monetization opportunities for operators and service providers. Additionally, we will see a new interactive ad space like UI banners and video overlays, which are less intrusive, can create high engagement, and produce a call to action from users.
Data & AI
AI algorithms based on viewing data will play a major role in TV advertising in 2023, as the targeting of users gets more precise based on viewing habits. First-party data will be especially important in the context of privacy concerns, as consumers are becoming more sensitive to how their data is used, and the legislation for using cookies is becoming more rigid.
Freemium to Premium
One strategy that has proven to be remarkably effective, and will keep evolving, is letting viewers choose between different tiers of monthly costs and associated ad load.
Many of the leading streaming platforms already offer a combination of ad-supported tiers, including Netflix, Hulu, Disney+ and HBO, leading the way for the others to join the ad party. Likewise, Apple is looking to build an advertising network around its exclusive 10-year deal with Major League Soccer in 2023.
Olivier Karra, Cloud Solutions Marketing Director at Broadpeak
With more OTT service providers shifting their business models from subscription tiers towards ad-supported tiers, we can expect the optimization of inventory monetization to be a key part of publishers’ strategy in 2023.
As this transition is happening through different phases, media companies need to maximize their ability to create and sell an ad inventory. Monetizing a content library through ad supported and free tiers is a typical example. In this case, the capability to dynamically manage — with fine granularity — ad break patterns, ad frequency, ad placement opportunities, and ratio usage is what will set video service providers apart from their competitors and best match an end users’ ad acceptability.
In addition, the market is also moving towards server-side ad insertion and programmatic ad sales.
With FAST channels expanding both rapidly and globally — alongside the emergence of temporary services such as FAST pop-up or thematic channels — the need to have fully automated, API-based, media and monetization workflows is becoming invaluable, and we can expect to see more of this in 2023.
2023 will also see video streaming service providers focus on their compliance with personal data care and data privacy regulation. With end-users increasingly concerned about how their data is accessed and what it is used for, many advertisers have now reduced access to this, which means video service providers will have to adapt to reduced targeting capabilities.
As a result, we can expect the use of content and context-based metadata to compensate for those new constraints and to keep the benefit of cohort targeting. Likewise, tighter integration with Content Management Systems, recommendation, contextualization, and metadata engine platforms are very likely to gain a lot of traction this year.
Rob Gambino, Senior Director, Advertising and Content, Harmonic Inc.
Free ad-supported streaming TV (FAST) platforms are set for continued growth in 2023. We anticipate that existing FAST platforms will grow their presence internationally, while new platforms will pop up to address underserved international markets, especially in Latin America and in Asia. The FAST experience, as well, will continue to evolve in 2023, offering viewers a mix of original content, premium movies and live sports beyond classic movies, television series and YouTube clips.
Improved content discovery for FAST will boost viewer engagement, and service providers will leverage cross-platform, universal search and discovery, and recommendations to bring viewers to content faster.
Monetization is a big challenge for FAST platforms – an issue we think will be addressed with targeted advertising.
Recent predictions from TVREV shows that by 2025, ad spend on FASTs will surpass that of cable, broadcast and SVOD services. We foresee CPMs for ad inventory soaring as addressability and quality of content increase.
Given the rapid growth of FAST platforms, we believe that video SaaS platforms running in the public cloud will be key to service providers for delivering their offerings at scale and staying agile in today’s increasingly competitive environment.
Editor’s note: OTTVerse thanks Prabhvir Samhey, Srinivasan KA, Laura Quigley, Anand Gopal, Rob Gambino, Anda Tanchuma, Olivier Karra for sharing their thoughts, ideas, and predictions for 2023. We wish them a great 2023 and look forward to hearing more from them this year.