Articles by: "Rande Price, Research VP – DCN"

Americans are losing trust in the media. What can we do about it?

October 31, 2023 Rande Price, Research VP – DCN

In a world driven by information, trust in the news has reached an all-time low in the United States. The most recent Gallup poll reveals that only 32% of Americans express “a great deal” or “a fair amount” of trust in the mass media to report the news fully, fairly, and accurately. This statistic ties with the lowest results to date from 2016 and reflects a significant decline in confidence over the years.

A further breakdown of the data reveals that another 29% of U.S. adults have “not very much” trust in the media, while a record-high 39% register “none at all.” The nearly four in 10 Americans completely lacking confidence in the media is the highest on record, surpassing Gallup’s 2016 results by one percentage point.

Historical trends

Gallup began tracking media trust in 1972. Trust ranged from 68% to 72% in the 1970s and started to decline in the late 1990s. The decline grew in 2004 when it dropped to 44%; since 2008, it’s registered annual declines.

One significant aspect of the decline in trust is the partisan divide. While Democrats have traditionally expressed more trust in the media than Republicans, the gap between the two has narrowed. Democrats’ trust has fallen by 12 points in the past year to 58%, compared to 11% among Republicans and 29% among independents. The gap in media confidence was largest from 2017 through 2022, during which Democrats’ trust remained above their trend average of 64%, while Republicans and independents lagged.

Interestingly, aggregated data reveals that young Democrats trust the media far less than older Democrats, highlighting generational differences in media perception. In contrast, Republicans’ views are less varied across age groups.

Rebuilding trust in the news media

The decline in trust in the media, as demonstrated by Gallup’s recent poll, reflects a deeply rooted issue in American society. Gallup’s research shows that trust in news media is eroding over time, leading to a disconnect between audiences and new outlets that inform them. The World Economic Forum identifies six steps for news organizations to rebuild trust in news and journalism’s integrity.

Build awareness about the trustworthiness of news media. News organizations must double down on their dedication to high-quality content by disclosing their principles and procedures for upholding accuracy and trustworthiness. This entails providing insights into their source evaluation, editing protocols, reader guidance, and responsible utilization of artificial intelligence.
Reduce exposure to harmful content online. News organizations must identify and cut back the malicious actors spreading information, and disincentivize the creation of echo chambers for extremist views.
Promote media information literacy and empower people to discern between reliable and misleading information. Integrating media information literacy into educational programs and offering it through corporate training ― to their employees and audiences.
Refrain from solely depending on AI for news generation. It’s important for news businesses to learn how to use AI to support journalism—from improving reporting techniques and expanding media literacy to enable individuals to share their narratives to establishing fresh channels for user interaction.
Strengthen credibility by emphasizing transparency and accountability. News organizations must use transparent processes and adhere to independently audited audience measurements to establish and sustain trust.
Increase interest and engagement in news media. News businesses need to create quality content that is accessible and affordable. Partnerships between media outlets and other players can provide consumers access to multiple news sources, overcoming challenges like walled gardens and privacy regulations.

Restoring trust in the news is a continuous process that demands cooperation among media organizations, tech firms, policymakers, and the public. Upholding the integrity of journalism is imperative to ensure that the public has confidence in the news outlets they depend on.

Industry-Research

TikTok is not news-friendly

October 24, 2023 Rande Price, Research VP – DCN

As audiences increasingly turn to social media platforms for news and information, the strategic priorities of these platforms play a critical role in news exposure. New research, Algorithmic indifference: The dearth of news recommendations on TikTok, delves into the role of algorithmic recommendation systems in news consumption in the U.S. The findings reveal minimal instances of TikTok proactively exposing users to news content. Furthermore, while TikTok’s algorithms respond somewhat to signals of news interest, the response does not significantly increase exposure to credible news content.

User interest and algorithmic recommendations

The dynamic interplay between user feedback and algorithm-driven recommendations shapes the social media platform experience. However, this cycle is insufficient on many platforms regarding news consumption. A platform must also maintain a repository of trustworthy journalism. Achieving this necessitates news providers sharing their coverage on the platform. On many platforms, this can be as straightforward as sharing a hyperlink. Yet, it represents a more substantial commitment to a multimedia-oriented and entertainment-focused platform like TikTok.

Further, TikTok lacks explicit distinctions and prioritization of news content. News exposure on TikTok is rooted in the interplay between user intents, platform responsiveness, and the availability of news content. Researchers Nick Hagar and Nicholas Diakopoulos explore how users interact with news producers and news-related topics on TikTok.

To assess TikTok’s algorithmic behavior, the researchers adopted a multifaceted approach. First, they examined recommended accounts, starting with four prominent U.S. news organizations’ TikTok accounts. They collected a dataset of 10,000 recommended accounts by scaping multiple layers of suggested accounts to follow. They also simulated the personalized “For You Page” experience on TikTok using 60 programmed bots designed to detect and decide whether to watch or skip videos based on their overlap with the day’s New York Times headlines. These bots had varying levels of news interest and collectively viewed over 6,500 videos. Additionally, the researchers gathered daily trending hashtags for a week and analyzed metrics for more than 100 U.S. news accounts.

Limited user interest in news

The findings reveal a considerable lack of user interest in news coverage on TikTok. However, whether or not this disinterest in news stems from users or the platform’s limited efforts to promote news is unclear. TikTok’s “For You Page” algorithm rarely presents news content, even with user engagement signals (18% of recommendations and 6% of traffic).

Two possibilities arise from these results. Firstly, there may not be enough active news producers on TikTok to saturate account recommendations. Secondly, the recommendation algorithm might struggle to recognize news producers as a distinct cluster of accounts, hindering its ability to suggest them effectively. Among the appearing news accounts, PBS News is the most frequent, representing diverse news producers, including TikTok accounts from newspapers like @latimes, individual journalists like @itsrachelscott, and news commentators like @briantylercohen.

Identifying challenges

TikTok’s rise as a dominant social media platform has introduced unique challenges for news consumption. The research’s examination of algorithmic news exposure on TikTok reveals a significant lack of proactive news distribution on the platform. Users are primarily exposed to entertainment content, trending news topics tend to lean towards entertainment, and news producers receive limited engagement.

To ensure broader access to journalism on TikTok, explicit platform interventions, such as labeling credible news outlets, elevating relevant news coverage, or giving journalism prominent placement, may be necessary. Balancing user preferences and facilitating incidental news exposure is challenging, but it is essential for fostering a well-informed and engaged citizenry in the digital age.

TikTok’s algorithmic indifference towards news content and limited user interest pose challenges for news consumption on the platform. Explicit interventions on the platform are needed to promote credible journalism and ensure a well-informed citizen.

Industry-Research

Americans are skeptical that AI will be used responsibly

October 17, 2023 Rande Price, Research VP – DCN

In this era of dynamic change, understanding consumer expectations and sentiments is a pivotal requirement for success. The 2023 Bentley-Gallup Business in Society Report provides valuable insights into the evolving attitudes of Americans towards businesses and their practices.

Notably, the report reveals that an impressive 63% of Americans now perceive businesses as positive contributors to society, marking a substantial increase in this sentiment. This shift is particularly significant at a time when trust in many institutions has waned. To maintain and further build trust, the report reinforces that businesses must think beyond positive margins and profitability and consider broader societal contributions.

Trust in AI

In particular, the report examines Americans’ concerns about businesses’ responsible use of AI. Almost eight in 10 of respondents (79%) express limited to no trust in businesses’ ability to adopt AI responsibly. This lack of trust extends across all demographics, including gender, race, age, education level, and political affiliation.

One of the key concerns contributing to this skepticism is the belief that AI intelligence will lead to job displacement. An overwhelming three out of four Americans think that artificial intelligence will reduce the number of jobs in the U.S. over the next decade. This apprehension is exceptionally high among those without a bachelor’s degree and those aged 45 or older. The research found that 18- to 29-year-olds are less concerned about AI’s potential impact on the job market. However, 66% of this age group believes AI will reduce job opportunities, compared to higher figures for older adults.

Benefits of AI

Interestingly, the public remains skeptical about AI’s overall benefit to society. Only 10% of Americans believe AI will do more good than harm, while 50% think it brings an equal balance of benefits and drawbacks. The remaining 40% believe AI does more harm than good. This cautious outlook spans all demographic groups, yet Black and Asian Americans exhibit a more positive perception of AI’s benefits to society. Seventy percent of Asian and 67% of Black adults believe that AI does more good than harm or brings an equal balance, compared to 60% of Hispanic and 59% of white adults.

The survey also highlights areas where Americans believe AI can outperform humans. For instance, most respondents believe AI is as good as, if not better, at tasks like customizing online content, recommending products or services, and assisting students with homework. However, Americans are more skeptical about AI’s capabilities in fields such as providing medical advice, driving cars, and recommending hiring employees.

Younger Americans are more optimistic about AI’s potential to enhance their online experiences. For example, 82% of those aged 18 to 29 believe that AI is as good as or better than humans at customizing online content, the highest among all age groups.

Best practices

The research speaks to the importance of addressing consumer concerns about the usage of AI. The report recommends three fundamental practices:

Transparency in how AI is being employed and the principles guiding its usage.
Responsibility in AI deployment is key, emphasizing its application’s ethical and moral implications.
Active and consistent communication to ensure that AI’s benefits are clearly articulated and understood.

This research presents a cautious public outlook on the overall benefits of AI and highlights the need for businesses to think responsibly about employing this technology.

Industry-Research | Revenue

More people are paying for news worldwide

October 9, 2023 Rande Price, Research VP – DCN

The way we consume news has dramatically transformed in recent years. Most news organizations adopted a digital news business model and now offer subscription products. Understanding online news payment trends and dynamics is crucial to support this business model.

Recent research from the Reuters Institute, the Digital News Report, shows a marked increase in people subscribing to or making one-off payments for news content. The industry is experiencing subscription growth ranging from 10% to 17% across 20 countries in the last 10 years. It’s worth noting that online news payments are beginning to stabilize in many of these 20 countries, and a notable correlation exists between high cancellation rates and the ongoing cost-of-living crisis.

Regional variances in online news payment

Authors Nic Neuman and Dr. Craig Robertson point out significant regional differences in consumers’ willingness to pay for online news. In some Nordic countries, over a third of the population subscribes to digital news services. In the U.S., 21% of respondents indicate that they pay for online news.

In contrast, in European markets like Germany and the United Kingdom, which offer high-quality free news options, subscription rates are lower at 11% and 9%, respectively. The variations highlight the interplay between market conditions, consumer preferences, and economic factors influencing online news payment.

The research identifies a combination of five factors that drive news subscribers:

access to distinctive and high-quality news and analysis
alignment with the brand’s values or political perspective
a commitment to supporting quality journalism
a premium user experience
the inclusion of lifestyle features, puzzles, and games

The U.S. news market is notable for its news loyalists. Approximately 47% of news subscribers say that they do so because to align with specific journalists or the viewpoints of news brands. The U.S. also stands out as one of the countries with a significant portion of its population donating to news organizations, accounting for 4% of the U.S. sample. This contribution includes paying podcasters, YouTube channels, and established brands like NPR and Vox Media.

The report highlights three phases that subscribers often undergo, from interest and intent to subscribe to retention and loyalty.

Subscription triggers: The first phase is a fundamental interest in news. This and other influences often trigger a subscription, including family influence, life-stage changes, enticing promotional offers, etc.
Building habits: The second phase includes engaging new subscribers during their initial 90 days through newsletters, podcasts, and personalization to build daily forming habits.
Maintain loyalty: The last phase is when subscribers develop loyalty to their chosen outlet and consider it their trusted source for information.

Changing payment methods

The way people subscribe to online news is evolving, with 46% of subscribers opting for ongoing digital-only subscriptions. Combined print and digital packages account for 28% of subscriptions, while 34% report someone else pays or it’s bundled as part of broader service packages (e.g., TV, broadband, or mobile).

Additionally, 12% of paying respondents report making one-off or ongoing donations to news services in the past year. These diverse payment methods reflect the changing expectations and preferences of news consumers.

Subscriber demographics

While most paying subscribers are older, the willingness to pay for online news is similar across age groups. However, younger individuals are likelier to have subscriptions paid for by someone else or make smaller donations.

Interestingly, 60% of paying subscribers are men, and a significant majority (79%) have medium to high household incomes. They tend to have received higher levels of formal education and lean more towards left-leaning political affiliations, especially in the U.S.

Consumer preferences, market dynamics, and evolving subscription models shape the willingness to pay for online news. As the digital news landscape evolves, publishers acknowledge the affordability gap and are crafting solutions in response. They look for ways to remain relevant by partnering and packaging all-access bundles, extending trial periods, and flexible renewal pricing to demonstrate value and commitment.

DCN-Research | Research

DCN research unveils the power of representation in audience engagement

October 4, 2023 Rande Price, Research VP – DCN

In an era where media consumption shapes opinions and influences culture, the spotlight is on media businesses being more inclusive and diverse in their content and practices to better serve audiences. DCN’s new Digital Media Audience Diversity Study finds that content that strikes a chord with diverse audience segments leads to heightened audience engagement. Such content can cement a company’s position in a fiercely competitive landscape and facilitate monetization.

The study examines the attitudes, values, and behaviors of different generational segments and racial, ethnic, and identity (REI) cohorts in the context of digital media. To accomplish this, a survey was conducted among 1,500 respondents ― proportionally across Gen Z, Gen Y, and Gen X segments and each segment included Black, Latino, Asian, LGBTQ+, and White populations.

Representation matters

The findings uncover the perspectives and preferences of how respondents engage with digital media content, their subscription practices, their relationship to ad-supported content, and their views on representation and portrayal.

In this regard, the study underscores the importance of incorporating inclusivity, diverse representation, and authentic portrayal in media content.

Black respondents exhibit a heightened awareness of diverse creators and producers, actively seeking television content where they see themselves represented.
The LGBTQ+ community expresses a deep-seated sense of underrepresentation and the need for more authentic narratives in media.
Asian audiences are eager to move beyond secondary roles in entertainment content and advocate for realistic and inclusive portrayals.
Black and LGBTQ+ audiences exhibit increased loyalty to media brands that respect their representation, sourcing content from creators who mirror their experiences and featuring talent that reflects their identity.

Impacts of mobile and social media usage

Generational nuances are exposed regarding the impact of mobile and social media usage on mental health. Gen Z and Gen Y are more attuned to the adverse effects of excessive social media and mobile use, particularly on self-esteem and anxiety. LGBTQ+ individuals, irrespective of their generation, also express heightened concerns over the negative implications of their digital engagements.

Willingness to pay for content

Diverse audiences exhibit varying tendencies toward paying for digital content. Gen Z and Gen Y are notably more willing to invest in digital content than Gen X, hinting at the shifting media consumption paradigms. Black and Latino cohorts emerge as more willing spenders on digital content than other REI groups.

Unlocking media benefits

The study reveals the appeal of on-demand access to content remains a consistent top benefit, across generational and Racial, Ethnic, and Identity (REI) cohorts.

The desire to watch what one wants when one wants is the foremost advantage of subscribing to video content.
Anywhere access emerges as the predominant advantage of subscribing to audio content.
Digital print media garners favor for its capacity to offer knowledge acquisition, personalized curation, consistent content updates, and unwavering quality.

DCN’s Digital Media Audience Diversity Study uncovers a spectrum of insights into the dynamics of digital media engagement. Understanding the subtleties within these findings across generation and Racial, Ethnic, and Identity (REI) cohorts is pivotal for content companies to engage with specific audiences effectively. Beyond profits, this engagement nurtures creativity, fosters inclusivity, and aligns media companies with the evolving ethos of a diverse and dynamic media future.

Full research report for DCN members only. Register to or login to download (on desktop see top right corner of page, on mobile the top center). Download buttons will appear at the top and bottom of the page.

Advertising | Industry-Research | Video

What neuroscience reveals about successful CTV ads

September 26, 2023 Rande Price, Research VP – DCN

In the evolving advertising landscape, the shift from traditional linear television to digital platforms offers new ways for marketers to reach their audiences. However, while advertisers have new tools and techniques to target audiences, viewers are confronted with ads that disrupt their viewing experience, feel irrelevant, or annoy them. And new research uses neuroscience to demonstrate how context and tone affect advertising’s impact in CTV environments.

Integral Ad Science (IAS) and Neuro-Insight’s new study, The Mind on the Stream, explores how advertisers can enhance the relevance of their CTV ads through tone and context. The research shows an increase of 14% in brand impact when the ads match the tone of the content viewed on CTV. Ads that match the context of the content experience show a significant boost in brand impact, +39%. Moreover, ads that match tone and context result in a greater significant increase of 49% in brand impact.

Matching advertising with content’s tone and context

The study includes a cohort of 137 participants in a controlled environment simulating an ad-supported streaming experience. All participants watch the same program content. During this simulated streaming experience, participants see 20 ads from 20 known brands across various verticals, including food/beverage, telecommunications, entertainment, finance, and consumer packaged goods (CPG). The ads vary in terms of length and narrative style.

The research tests the ads in two ways: tone/context and frequency.

Group 1 participants undergo tone and context variations, where some ads match the show’s context, some match its tone, and some match both tone and context.

Tone matches when advertisers ensure that their ads align with the overall feeling or voice of the content they accompany. In this study, since the program content is humorous, the research examines the impact of running ads that are also humorous.
Context matches when there’s a thematic or tangible connections between an ad and the program content. For instance, if the show features basketball, a contextually matched ad would also incorporate basketball elements.

Group 2 participants encounter different ad frequencies, with some ads appearing once, twice, three times, or four times during the program.

The study includes several metrics to measure the impact between Group 1 and Group 2 exposures.

Detailed memory measures ad memorability and brand impact by analyzing how well viewers retain specific details from the ads.
Emotional intensity gauges the emotional impact of the ads on viewers, with high scores indicating a strong emotional connection.
Global memory assesses how well viewers remember the visual, audio, and thematic elements.
Engagement measures the personal relevance of ad content to viewers.
Approach/Withdraw identifies the “lean in” or “I want to learn more” response from viewers, indicating likeability and overall positivity or negativity towards the ads.

Ad frequency

Interestingly, viewers overall show lower interest in ads repeated multiple times on CTV. However, ads that align with the video content mitigate the negative impact of repetition and perform better among viewers despite increased frequency. While brand impact remains consistent through the third viewing of a CTV ad, the fourth viewing results in a significant decline of 26%. This emphasizes the importance of limiting ad frequency to three viewings to preserve viewer connection and comprehension.

Advertisers and streaming publishers can optimize their ad strategies and drive better results when matching ad tone and context with the content viewed on CTV. The study also underscores the critical role of ad frequency in viewer engagement. By embracing contextual targeting, marketers and publishers have an opportunity to shift ad budgets and deliver impactful results in the digital advertising landscape.

Industry-Research | Video

FAST momentum drives the booming streaming market

September 12, 2023 Rande Price, Research VP – DCN

The streaming revolution is reshaping content consumption at a rapid speed. comScore’s State of Streaming 2023 reveals a 21% surge in the number of hours households watch connected TV (CTV). This increase translates to an additional 2 billion hours in 2023 compared to the previous year. Total hours viewed grew from 9.6 billion to 11.5 billion from May 2022 to May 2023.

Ad-supported services, which claim the largest part of the newfound viewing audience, are driving this growth. The data underscores the shift towards digital streaming as millions of households’ primary content consumption mode.

The overall growth in streaming consumption is quite impressive. However, the most game-changing statistic highlighted in the report is that 75% of the newly acquired streaming hours are from providers beyond the top six streaming apps. This elite group includes Netflix, YouTube, Prime Video, Hulu, HBO Max (now Max), and Disney+ is witnessing an interesting transformation. As the consumption of FAST (Free Ad-Supported Television) and targeted programming intensifies, these traditional giants face competition from rising stars in the streaming realm. FAST’s expanding influence is reshaping the streaming landscape.

Key trends in the streaming market

comScore’s report explores and confirms trends in the streaming landscape, adoption, growth trajectories, and the ever-evolving range of services.

Digital video acceleration: Digital video consumption is accelerating, with 81% of households with WiFi engaging in streaming content.

Ad-supported streaming growth: CTV households streaming ad-supported content now reach an impressive 83.7 million, a 17% increase from 2021 to 2023. Non-ad-supported services also showcase growth, reaching 81.1 million, reflecting a 9% increase.

Targeted programming triumph: Targeted programming on FAST platforms is surging. Hispanic households lead the charge by consuming nearly twice as many hours of FAST content, showcasing an impressive 81% YoY increase. Linear streaming providers also found their place in the digital realm, securing three top spots in the Top 10 video services based on hours viewed per household.

Cord-cutting dominance: The cord-cutting trend is reaching a new milestone, with 60% of CTV households now being cordless. This substantial leap from the 37% recorded in May 2019 underlines the growing shift away from traditional TV subscriptions.

Smart TVs reign: Smart TVs are firmly establishing themselves as the preferred device for CTV streaming, with a robust 23% increase in total households streaming content via these devices since May 2021. Gaming consoles are also seeing a notable 18% increase in usage for streaming purposes.

Real-time market impact at play

Further, comScore’s report provides context in understanding how the evolving TV streaming marketplace impacts the current television revenue model. The current Charter-Disney dispute centers on pressure to change the existing television distribution paradigm. Charter is declining to accept Disney’s requested fees for its channels, citing the fact that Disney primarily reserves its premium content for its streaming platforms. Charter wants complimentary access and distribution flexibility, which directly impacts Disney’s direct-to-consumer revenue strategy. This dispute underscores the rapidly shifting dynamics of the entertainment industry.

The State of Streaming showcases the ongoing revolution of streaming in the entertainment landscape. With consumption growth, the ascent of ad-supported services, and the proliferation of emerging players, the report provides valuable insights to help reshape content monetization strategies.

Industry-Research | Video

Streaming consumers like episodic content on big screens

August 22, 2023 Rande Price, Research VP – DCN

The streaming industry is experiencing rapid, continuous evolution including consumer behavior and preferences. NPAW’s, a global video analytics company, new report Video Streaming Industry Report H1 2023, tracks and analyzes video consumption, consumer behavior, and quality of experience. The research looks at streaming behavior in Asia, Europe, Latin American, North America, and the Pacific. The report shows that overall playtime for the streaming industry is growing steadily, with a 4% increase compared to the previous year. This offers a positive indicator of user engagement with platforms and their content.

Streaming playtime grows

Further, all regions except Asia report higher playtime per user and service. North America leads the way with a remarkable 41% year-over-year increase, followed by Latin America at 21%. These differences highlight the diverse streaming preferences that exist globally.

Examining the raw figures reveals the emergence of two distinct categories. Europe, North America, and the Pacific region constitute high-consumption zones, each averaging over 79 minutes of daily service usage per individual. In contrast, the second group, comprising Asia, Latin America, and the Middle East, experiences less usage, with a daily average of under 53 minutes. Notably, Asia records a mere 30 minutes.

Episodic content takes center stage

NPAW’s streaming data shows a clear preference for episodic content among users. Globally, episodes account for 60% of the total playtime, whereas movies capture 25%. This preference for episodic content remains consistent across regions, except in North America, where movies share a comparable share of playtime. Notably, the Middle East stands out as a region favoring episodic content, with movies and short content comprising less than 10% of the total playtime.

Smart TVs dominate the viewing landscape

The dominance of large screens, especially smart TVs, in VOD consumption, is expanding. In the first half of 2023, smart TVs contribute 51% of the total VOD playtime, highlighting viewers’ inclination towards the immersive experience provided by these bigger devices. This trend also plays a role in consolidating smaller-screen devices like smartphones, which are currently witnessing a decline in their share of playtime.

Parallel to VOD, larger screens continue to dominate linear TV consumption. TVs and set-top boxes collectively account for approximately 80% of the linear playtime, highlighting viewers’ preference for the traditional, in-home viewing experience.

Sports streaming takes off

One of the most remarkable trends in streaming is the rapid growth of sports streaming. Major sporting events in the first half of the year increased substantially in streaming adoption and engagement compared to the previous year. This surge in sports streaming highlights the changing nature of entertainment consumption as viewers increasingly turn to streaming platforms to catch their favorite sports action.

Streaming evolution

The streaming landscape continues to evolve in the first half of 2023. VOD consumption continues to grow, driven by user preference for episodic content and larger screens, particularly smart TVs. Improvements in visual and audio quality contribute to a more gratifying streaming journey across most geographical areas. Understanding user preferences and expectations remains pivotal in shaping the future of entertainment consumption. Be it indulging in episodic narratives via smart TVs or immersing in live sporting spectacles on expansive screens, streaming is a universal practice.

Advertising | Industry-Research | Video

Advertising popular with streamers and consumers

August 15, 2023 Rande Price, Research VP – DCN

It is becoming increasingly clear that advertising will play a significant role in the streaming ecosystem. As Disney CEO Bob Iger told investors in Disney’s quarterly earnings call, “The advertising marketplace for streaming is picking up.It’s more healthy than the advertising marketplace for linear television. We believe in the future of advertising on our streaming platforms, both Disney+ and Hulu.”

Industry giants are now seamlessly incorporating ad-supported tiers into their streaming options. This shift from the early days of subscription-based, ad free streaming underscores the industry-wide recognition that catering to budget-conscious consumers is integral to achieving sustainable subscriber growth.

New research from HUB, TV Advertising: Fact or Fiction, affirms that most television viewers actively embrace ad-supported offerings. Six out of ten viewers prefer ad-supported subscriptions, especially when presented with the prospect of a reduced monthly fee. Interestingly, those with reservations about advertising remain in the minority, underscoring the widespread acceptance of ads as an primary and tolerable factor of content consumption.

Shifting the paradigm

The transformation in consumer sentiment towards ad-supported subscriptions carries a dual impact. Firstly, it renders ad-supported tiers significantly more appealing to a broader spectrum of viewers, including those who haven’t subscribed previously. Secondly, it reinforces the notion that the quality and diversity of content have a significant influence over viewer preferences. This often outweighs the appeal of a completely ad-free experience. Within the streaming ecosystem, advertising now emerges as a central thread weaving together content variety, affordability, and viewer gratification.

The rising desire for customization

Furthermore, a growing trend in viewer preferences is the desire for enhanced control over subscription tiers. Nearly four out of 10 viewers express a strong inclination towards personalizing their subscription model. They’re searching for a flexible array of choices, ranging from a premium, ad-free encounter to a more budget-friendly alternative featuring strategically placed advertisements. The attraction in customization preferences empowers streaming providers to cater to a broader spectrum of consumer segments.

Entrants that intrigue

Notable platforms like Max, Disney+, and Netflix, which recently embraced ad-supported tiers, are meeting positivity from their audiences. This dispels concerns about potentially hurting your brand in a previously ad-free service due to the introduction of advertisements. Twenty-seven percent of viewers switched tiers. Among them, 60% switched from with ad to no ad tiers, and 46% switched from no ads to with ad tiers.

Enhancing engagement through thoughtful execution

Ensuring a satisfactory viewing experience for consumers creates an environment ripe for advertisers to thrive. When viewers encounter an appropriate amount of advertising content, their engagement levels increase. This principle extends not only to the overall number of ads but also to the duration of ad breaks. Contrary to the notion that advertising detracts from the streaming experience, it possesses the potential to elevate it, capturing viewers’ undivided attention when executed thoughtfully.

The valuable component of ad-supported subscriptions

As viewing sources diversify, ad-supported subscriptions assume a key role within the streaming landscape. Subscribers want the autonomy to mold their subscription expenditure as well as the degree of advertising they’re willing to embrace. In response, streaming platforms offer a dual strategy, presenting ad-supported and ad-free tiers. This shift harmonizes content diversity, affordability, and engagement, shaping the streaming ecosystem.

Advertising | Industry-Research | Video

For SVOD success, launch with ads from the start

August 8, 2023 Rande Price, Research VP – DCN

In the ever-changing landscape of streaming services, media companies constantly explore new strategies to attract and maintain subscribers. One notable approach is the success of the ad-support SVOD tier. In fact, new research from Ampere shows that streaming services launching with an ad-supported tier from the start have a higher proportion of subscribers than those that added it later.

Ampere’s data reveals that SVOD services like Hulu and Peacock, which were early adopters of ad-supported tiers, boast an impressive 90% of ad-supported viewers. On the other hand, latecomers like Netflix, Disney+, and HBO Max struggle to gain significant traction with their ad-supported options. These late starters capture only a small share of their subscriber base. For instance, as of June 2023, approximately 2% of Netflix and Disney+ US subscribers are on the ad-supported tier. Even HBO Max, which launched an ad tier in March 2021, had only 5% of its subscribers on its ad-supported plan before transitioning to Max in April.

Drivers of success

Ultimately, an ad-supported tier’s success depends on several factors, including the service’s pricing strategy, content library, and targeted audience. Launching with an ad-supported option from the start appears to be more effective in building a substantial base of viewers. Late adopters may find attracting a significant share of their subscribers to the ad-supported tier challenging. This is especially true if the service has a strong legacy of being ad-free.

Ad-free service is still appealing

Despite the apparent appeal of ad-supported viewing, most new subscribers across the top seven SVOD services still prefer ad-free plans. According to Antenna data, between January and May 2023, three out of five new subscribers opted for ad-free viewing. Even services that recently introduced ad-supported tiers, such as Peacock, saw a considerable percentage (69%) of new subscribers choosing ad-free options.

However, there are potential changes on the horizon. Netflix has made a strategic decision to remove its Basic plan, which previously served as a mid-range option between the ad-supported and standard ad-free plans. With the elimination of the Basic plan, the price gap between ad-supported and ad-free viewing has increased significantly from $3 to $8.50 monthly. This move might lead more new subscribers to opt for ad-supported viewing due to the cost difference.

Additionally, Netflix’s crackdown on password sharing during June and July 2023 could have also impacted its subscriber base. Free viewers who were previously enjoying content outside of the subscriber’s home are now more likely to sign up for their accounts. For these price-conscious users, the cheaper ad-supported tier could become an appealing option.

However, the trend of traditionally ad-free services attracting more ad-free subscribers might continue to prevail. Peacock’s decision to close the free ad-supported tier to new users. However, they still allow existing subscribers of the free ad-supported to continue using it. This suggests that companies are recognizing the importance of retaining ad-free subscribers.

Industry-Research

This survey can enhance people’s ability to detect misinformation

August 1, 2023 Rande Price, Research VP – DCN

In today’s fast-paced digital age, there is an overwhelming amount of information, making it increasingly challenging to differentiate fact from fiction. Researchers recently developed a two-minute survey, Misinformation Susceptibility Test (MIST), to assess an individual’s ability to distinguish between real and fake news. By delving into the nuances of misinformation susceptibility within social psychology, particularly concerning social media, academics may be able to devise more potent intervention strategies. MIST offers a pivotal starting point for researchers to gain a profound comprehension of the underlying principles of social media products and their algorithms’ impact on the vulnerability to misinformation.

The MIST survey is comprised of 20 headlines, and participants must identify the fake headlines among them. The tool measures individuals’ ability to detect deceiving elements, such as manipulative language, in just two minutes. Interestingly, the research shows that younger Americans under 45 performed worse than older adults in distinguishing between real and fake news. Younger adults are more likely to suspect misinformation where there is none. They also tend to mistrust news headlines overall, possibly influenced by their higher online media consumption.

Further, mainstream news consumers, particularly those of AP news, perform better at distinguishing between real and fake headlines, with an average of 16 correct identifications. The study reveals that those who get their news from social media, especially Snapchat, could improve in distinguishing between real and fake headlines, as approximately 53% of Snapchat news consumers correctly identified just 10 or fewer headlines.

Enhancing news veracity acumen

MIST serves as an educational tool that provides individuals with an understanding of their susceptibility to misinformation and offers valuable insights into improving detection. The test’s feedback highlights specific areas where participants may be prone to errors in judgment. This empowers individuals to be more critical of the information they encounter and encourages them to adopt evidence-based approaches when evaluating news content.

The researchers plan to conduct further research on the correlation between “actively open-minded thinking” and resilience to misinformation. Specifically, they aim to explore methods of ranking content to enhance open-minded thinking.

Combating disinformation

In an era where misinformation can have profound societal consequences, MIST is a potent weapon against disinformation. By arming individuals with the tools to identify and combat fake news, tools like MIST can help create a more informed and discerning population. This, in turn, can lead to a decline in the viral spread of misinformation, ultimately contributing to a healthier information ecosystem.

MIST has significant implications for educational institutions and media literacy programs. By integrating this test into curricula, it can be used by educators to help students develop the necessary skills to critically navigate content online . Teaching students how to assess the credibility of sources, cross-check information, and challenge their biases will foster a generation better equipped to confront misinformation and make informed decisions.

MIST could significantly advance the ongoing battle against the widespread issue of misinformation. Embracing it as part of a strong academic approach could play a vital role in transforming media literacy education programs. The psychometric validation of the test ensures that it offers dependable and precise insights into an individual’s susceptibility to believing and disseminating fake news. Tools like the MIST in literacy programs empower individuals to learn more about discerning information and contribute to a more informed society. Ongoing efforts to refine and improve MIST, alongside other tools, and strategies, are vital in effectively addressing the challenges posed by the constant flow of deceptive information

Industry-Research | Research

Digital benefits entice new news subscribers

July 25, 2023 Rande Price, Research VP – DCN

Advertising messaging is an important trigger in increasing people’s willingness to pay for online subscriptions. New academic research, Effects of Advertising Messages on Willingness to Pay for Online News, from Bartosz Wilczek, Ina Schulte-Uentrop, and Neil Thurman, evaluates effective advertising strategies for online subscriptions. The study focuses on four types of advertising appeals: digital-specific, social, normative, and price transparency. The findings indicate that digital-specific features appeal. Aspects like personalization, online-first delivery, and online-only offers significantly impact participants’ willingness to pay. This suggests that emphasizing the unique digital advantages of online news can increase sign ups and subscription interest.

Messaging impact

This research sets out to address two crucial questions. First, it seeks to uncover the most potent individual advertising message (digital-specific, social, normative, or price transparency appeal) to drive people’s willingness to pay for online news.

The study also looks to understand which combination of advertising messages among digital-specific, social, normative, and price transparency messaging ultimately boosts people’s willingness to pay for online news.

Messaging appeal

The different respondent testing shows that digital messaging is the most potent. Social messaging that emphasizes community membership and offline and online events also positively influences participants’ willingness to pay. This finding suggests that fostering a sense of belonging and engagement within a community can enhance subscription intentions.

Normative messaging, which focuses on the importance of supporting independent, inclusive, and watchdog journalism, has a moderate positive impact on willingness to pay.

Interestingly, the price transparency appeals, which provide information on the news industry’s critical financial situation, do not significantly impact willingness to pay. This suggests that while consumers may value transparency, it may not be a primary motivating factor for subscribing to online news.

Combining messages

The research reveals that combining advertising messages can increase people’s willingness to pay for online news. Combining the normative appeal with the price transparency appeal is the most convincing. In comparison, other combinations of advertising messages do not yield significant effects on people’s willingness to pay for online news.

What’s surprising is that neither the normative nor the price transparency appeal is sufficiently convincing on its own. However, combined, they effectively increase audiences’ willingness to pay for online news. Moreover, the findings suggest that adding a digital-specific or social appeal to a subscription pitch that includes both a normative and a price transparency appeal is ineffective. One explanation could be that the more appeals a subscription pitch contains, the longer and more complex it becomes—which might decrease its effectiveness. This suggests that the efficacy of a subscription pitch depends less on the quantity and more on the quality of arguments and how well they work together.

Digital news publishers can leverage these insights to tailor their advertising strategies and enhance subscription uptake. By highlighting the unique features of online news, fostering a sense of community, and emphasizing the societal importance of independent journalism, publishers can increase consumers’ willingness to pay for online news subscriptions. However, it is important to note that normative and price transparency appeals may have a limited impact on subscription intentions on their own, suggesting the need for a multi-faceted approach to advertising online news subscriptions.