Report: AVoD audience set to surpass SVoD
February 10, 2022
Findings from Tubi, FOX Entertainment’s free streaming service, reveal the explosive growth of AVoD services, set to surpass SVoD this year in audience size, and the changing demographics of a free streaming universe that remains young and multicultural while becoming more reflective of national audience averages in education and affluence.
The report, The Stream: 2022 Audience Insights for Brands, also revealed that Tubi had 3.6 billion hours streamed in 2021, a 40 per cent YoY increase in total viewing time (TVT) across its largest-in-streaming library of more than 40,000 titles. Further, Tubi’s incremental audience continues to complement other video investments – with 71 per cent of Tubi streamers unreachable on cable, 56 per cent unreachable on linear TV, and 27 per cent unreachable on any other major free streaming platform.
“Our findings in The Stream bring AVoD to the forefront of streaming investment planning for brands in 2022, as well as a necessary complement to existing linear TV strategy,” said Natalie Bastian, Senior Vice President, Marketing, Tubi. “At Tubi, we’ve focused on connecting with new communities — both by accessing FOX’s desirable audience as well as partnering with next generation platforms to reach audiences not found on linear television — and it’s paid off with rapid growth among key audience segments.”
Among the report’s key insights:
- Free streaming’s audience will grow larger than paid streaming by mid-2022. AVoD audiences grew twice as fast (+16 per cent) as SVoD (+8 per cent) in 2021. In 2022, The Stream projects that the current ~5 per cent gap in market penetration will close, with the number of AVoD users surpassing SVoD. This is attributable to a variety of factors, including subscription fatigue, ubiquitous hardware, cord cutting and increased broadband access. While total view time (TVT) is still led by SVoD, the opportunity for AVoD to expand TVT has never been greater.
- Free streaming viewership is expanding rapidly among educated and higher-income earners and becoming more reflective of national audience averages. AVoD adoption was led by the young (who still over-index vs. general population), but mature, educated, and affluent audiences are growing rapidly. Tubi has seen double-digit growth in all audience segments over the past year — with the most growth among college educated and affluent ($100k+ HHI) demos, placing Tubi on par with US national averages. With an average viewer 16+ years younger than non-streamers, Tubi’s audience has become nationally representative across geographic, economic, and educational segments, and includes a large multicultural audience, comprising 40 per cent of its user base.
- Free streaming platforms are garnering distinct, loyal audiences, while maintaining audience overlap with SVoD. Streamers continue to gravitate to specific AVoD services as their “television of choice”, while being selective about which services they pay a premium for. Factors that determine AVoD selection in a crowded marketplace include ease of use, content, personalisation and user experience. Currently, over a quarter (27 per cent) of Tubi streamers can’t be reached on any other major AVoD service: 78 per cent aren’t on Peacock, and 62 per cent aren’t on Hulu; however, 71 per cent subscribe to Netflix, currently unreachable by ads.
- Streaming will become the fastest growing video format in both viewership and media investment. Connected TV and over-the-top (CTV/OTT) ad spend grew 34 per cent in 2021, compared to 7.4 per cent for national broadcast and cable. The Stream projects that half of all internet users will use free streaming services by 2024, and by 2026, ad-supported video on demand (AVoD) revenues will triple 2021 levels, reaching $31.5 billion.
- Streaming viewers are becoming more receptive to ads. Tubi has some of the lightest ad load in the AVoD space: only 4-6 minutes per hour of viewing, giving advertisers increased brand recognition and recall in an environment where viewers are most receptive. This compares to traditional TV, with an ad load of 13-17 minutes every hour. Tubi streamers are 10 per cent more likely than the general population to state “I like to look at advertising”.
In maintaining quality ad load, 82 per cent of marketers state ad frequency management is an important factor when partnering with streaming television. With OTT ad spend expected to grow 28 per cent in 2022, Tubi’s Advanced Frequency Management (AFM) solution allows brands to reduce ad repetition and over-frequency, targeting the right viewers with precision and fully realising the return on their streaming investments. The Stream illustrates AFM’s value for advertisers with a major insurance brand that experienced 213 per cent more unique devices reached and a 113 per cent increase in average daily unique reach during its campaign with Tubi. Furthermore, advertising on Tubi delivered between 75-95 per cent incremental reach for brands.