The ongoing strike by writers and actors against Hollywood studios isn’t a top issue in the martech community. But, could martech solve it? Chris Kelly, CEO of Upwave, an analytics platform for brand promoting, thinks it’s possible.
He believes higher ad measurement for advertising-based video-on-demand (AVODs) and subscription video-on-demand (SVODs) would get brands to spend more on them. The increased income would mean more cash for all sides and that will settle the strike.
It’s a rational idea, but arguments over money don’t all the time respond to rationality. Our conversation about this raised other interesting questions, as well.
(Interview edited for length and clarity.)
Q: So tell me about how to end the strike.
A: This strike, like all strikes, is about money and economics. And a whole lot of the language we’ve seen coming from the studios, the content owners, is about the unclear economics of streaming.
If you dig into that, you see they really have higher average revenue per user for his or her AVODs (advertising-based video-on-demand). Meanwhile, the SVODs (subscription video-on-demand) imagine they’ll have that when they’re scaled up. So you’re thinking that, “OK, how can we get more if we would like the strike to end and we would like talent to be paid?” The studios are saying we’d like to have higher economics from streaming. And streaming is saying we have now to scale up the average revenue per user on the advertising-supported side. To do this, you would like more brands to come to CTV and streaming apps.
The brands we work with to measure promoting want to know if AVOD works. They don’t just want to get told the variety of views, they don’t just want to be told whether someone paid attention. Those are course critical table stakes, but for a brand-building campaign, you measure what’s called brand outcomes, which is what we do. Did you get an incremental change in some brand awareness? If you will have that awareness, you’re trying to raise favorability. Or they’re trying to convert favorability to consideration for a product that folks like but aren’t buying it out.
Q: How does that apply here?
A: The brands are telling us when those traditional brand KPIs recover in the CTV and streaming ecosystem, they’re going to invest more brand dollars. More brand dollars implies that average revenue per user for AVOD goes up. If AVOD revenue goes up, assuming we imagine what the studios are saying, that’s going to be impacting their economics of streaming in way. One of the big issues for the two sides of the strike is around the economics of streaming and each how much gets paid out and on what terms.
Now, we’re not strike experts, we’re not union experts, however it seems fairly straightforward to see what they’re fighting over. Instead of arguing about who gets how much of the pie, why are we not talking about how to make the pie larger? If the pie gets larger then every slice is price a bit more. So that’s how the dominoes fall in our brains after we take a look at the strike.
The key to getting to this place is measuring. Let’s prove that brand promoting works on these, on these programs. If it does, we’ll get more cash. If you get more cash, then that grows the pie and makes and hopefully eases these crazy tensions between the talent and the studios.
Q: Why do the brands think the impact of ads on AVOD and SVOD is different than linear TV? It’s still me watching my video.
A: Yeah, that’s an ideal query. If it’s the same content on the same screen for the same consumer, why do you’re thinking that otherwise about it? I believe there are two answers for that, the philosophical answer and the practical answer.
The philosophical answer is it shouldn’t. But that requires people going back and questioning whether linear has worked. There’s this free pass in the measurement world about outcomes on linear campaigns. For a long time we said the TV-Industrial Complex is how brands were built. It’s how the media ecosystem was built up. How news operations were built up in America. And it got this free pass.
And satirically, all the questions around ‘Did my investment in that streaming app work?’ are raising questions on how do I do know my broadcasting ads worked? I should probably measure the outcomes of that, too. At the end of the day, it’s not different. It’s the same content in the same ad on the same screen to the same member of the family. But linear outcomes have really not been measured at the top of the funnel.
Q: And the practical answer?
A: The practical answer is it’s often different parties and different agencies who’re touching these items. So, as you understand, we’ve had digital agencies who worked on our brands’ display and banner ads and online video buys for years. At the same time, we had the TV agency that worked on the linear buy. Sure it’s the same creative, but when it’s converted right into a 30-second pre-roll, it gets sent to the digital agency. When it’s a 30-second spot on broadcast, it gets sent to the TV agency and that’s changing.
And then this big query arises of who owns the CTV budgets? It’s TV, however it’s digital, it’s each, so who owns it? In general, the TV people have gotten more of that. But that is ending and there aren’t going to be digital agencies and TV agencies, they’ll just be media agencies who’ve to be cross-channel.
Q: You’ve recommend a theory that’s clear enough that I can understand it. But will something that clear and direct survive a Hollywood negotiation?
A: Yeah, I won’t claim any expert insight into being in the actual negotiating room and how the legal drama will play out. That part we don’t know. We just take a look at it from ‘team brand,’ as we are saying. So we all know that brand promoting has paid for the movies, the TV shows we devour, the music we listen to. And that’s why that is all the time on our minds.
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