The way that we consume television and media is constantly changing. From linear television to video-on-demand (VOD) streaming, the TV landscape is becoming increasingly digital. One of the services that have emerged in recent years is an advertising-based video on demand (AVOD). But what does the next year have in store for AVOD? First, let’s take a look at a few predictions.
AVOD Predictions and Trends for 2023
The popularity of AVOD to increase in 2023
According to analysis by Kantar, AVOD grew from 20% to 23% market penetration in the US between 2021 and 2022. This trend is predicted to continue into 2023 as more large streaming services begin to roll out or announce cheaper ad-supported subscription tiers.
After all, many consumers and businesses alike are still feeling the effects of the coronavirus pandemic, especially in the UK with the current cost-of-living crisis. With a recession on the horizon, many people will be looking to save money – and cutting down luxuries like streaming services is an obvious choice.
With this in mind, ad-supported streaming options are likely to see a boom in popularity, as they tend to be either free or more budget-frienmarketers’ perspective. From the marketers’ perspective, this will also lead to an increased desire to advertise on AVOD platforms.
Another insight from the analysis found that advertisers will likely have to adapt to deal with Google phasing out and removing support for third-party cookies in the coming years. Without cookies, advertisers will operate differently, gaining ToToTorfuture-proof methods.
To future-proof AVOD advertising, brands might consider partnering with an AVOD advertising agency. These agencies can support brands to levoptimizingnced household targeting and optimize AVOD ad campaigns.
Not only that, but AVOD advertising agencies are experts in their field – they specialize in this kind of advertising. This means they have the capability, knowledge, experience, and desire to innovate. So, they will be better positioned to move towards a cookie-less future than an in-house advertising department.
AVOD to narrow the gap with SVOD
A report from Dentsu predicts that, in 2023, AVOD will begin to catch up with subscription video on demand (SVOD) as the VOTheyt time spent. Furthermore, they predict that AVOD will likely overtake SVOD over time, perhaps even in the next few years.
Again, this is likely to result from more consumers switching to free or cheaper streaming services during economic instability. As such, AVOD is likely to become more popular as the VOD service of choice and in terms of time spent on the platform.
Ad revenue to increase
Ad revenue is also expected to increase with the increasing demand and popularity of AVOD. Ithe n fact, Netflix is predicted to increase the average revenue per user (ARPU) by 4.9%. In other words, it will make $2.2 billion more globally than it would have with only SVOD options.
Due to the lasting impacts of the coronavirus pandemic and the cost-of-living canceling, more consumers are canceling subscriptions to streaming services or looking for cheaper options. As a result, time spent on AVOD services, the popularity of AVOD platforms, and AVOD ad revenue will likely increase in 2023 and the future.