Before the proliferation of internet video, ads were core to the traditional television business model and thus ad tolerance was a regular part of consuming video. With the introduction of premium networks and over-the-top video came increased consumer willingness to pay for ad-free content.
That trend may be changing again. With so many video services and free content offerings available, more consumers are admittedly ad-tolerant, representing a paradigm shift echoing past trends. In this dynamic environment and saturated market where viewers are more inclined to tolerate advertising, more services may consider offering lower priced, free or ad-sponsored content to help consumers manage their costs.
In order to track and identify key trends in viewing habits, TiVo has released its “TiVo Q2 2022 Video Trends Report,” conducted across the United States and Canada. The survey involved 4.504 consumers aged +18.
● OVERALL VIEWERSHIP DIPS SLIGHTLY IN Q2
Respondents reported watching an average of 4.3 hours of content per day overall, compared to 4.5 hours for the last quarter of 2021. The biggest dip in viewing came from millennials, whose total viewing time dropped more than a half hour, from 5.3 to 4.7 hours per day.
● SHIFTS TOWARD AVOD/FAST
Respondents averaged a total of 9.86 services, up from last year’s 8.88. As that number approaches double digits, the share of AVOD services has gone up. In 2022, nonpaid services accounted for about 32% of the overall share, compared to 26% in the fourth quarter of 2021.
The perceived quality of AVOD/FAST content also increased slightly at the expense of all other service types, driven mostly by the perceptions of pay TV subscribers who are increasingly turning to AVOD services as a supplement.
● VIDEO REMAINS A PRIORITY
70% of respondents said their video entertainment spending is a moderate to high priority, despite inflation and socioeconomic concerns. Only 25% of respondents reduced their entertainment spending.
● CHURN AFFECTS ALL VIDEO SPECTRUM
In the fourth quarter of 2021, 26% of pay TV subscribers said they were planning to cancel their pay-TV service or “cut the cord” in the next six months. During that time, only 11% of respondents actually went through with cutting the cord, and 9% of which said that they were likely to “revive” the cord again at some point.
In comparison, respondents’ intent is more closely aligned with action when it comes to streaming services. 25% reported plans to cancel a paid streaming service in the next six months, and nearly all (24%) went through with it.
● TOLERANCE TO ADS
78% of consumers in the United States and Canada could be described as “ad-tolerant.” In fact, fewer than a quarter of respondents identify as “ad-averse”— prioritizing paying for ad-free plans and avoiding ad-supported services to avoid watching advertising.
● SMART TV, THE FAVORITE SCREEN
Though streaming media players are the top connected devices, consumers prefer Smart TV interfaces. Despite varied device ownership, respondents said they prefer smart TV interfaces over those of other connected devices by 20%.
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