After years of hiding its audience statistics in secrecy, Netflix recently announced that it will join the UK’s Broadcast Audience Research Board (Barb), Integral Ad Science (IAS), Nielsen and DoubleVerify. These movements, which confidently demonstrate a commitment to greater transparency, will finally provide a clearer picture of its true influence with the public.
Yet, for the rest of the world, it also has major significance. Leslie Adams, Sales Manager at Reach Africa, says this U-turn will – for the first time – allow the streaming platform to be measured and audited alongside live TV by an independent third party.
Adams shares four things advertisers need to know about this historic move — and what it means for the category as a whole.
Netflix previously only released its viewership statistics selectively. – why is it now moving towards greater transparency?
We are now entering the era of transparency and measurement. Previously, Netflix and other streaming services were primarily concerned with growing their subscriber base. This change signals that the category is starting to realize that this base is going to – and is already starting to – plateau, and that ad spend will become an important driver in its next phase of revenue growth.
With this in mind, it becomes all the more important for the category to offer independently audited audience and subscriber metrics; know how integral these are to marketers in their advertising budget allocations.
What is the difference between how live TV and streaming platforms are measured?
According to the National Association of Broadcasters (NAB) audience measurement report“Audience measurement…allows advertisers to understand viewing habits, which enables informed decisions on where to place ads to reach the right target audience at the lowest cost.
Although there are several methods, one of the most common methods of TV audience measurement is through the Broadcast Research Council (BRC) TV Audience Measurement (BRC TAMS). This system uses “peoplemeter” technology; a tool that measures the viewing habits of viewers. Commissioned by BRC’s research provider, Nielsen, this data is released daily through media planning software tools.
On the other hand, streaming services, which are predominantly digital, will be able to offer advertisers more granular data, revealing a deeper and more detailed picture of audience patterns, audience profiles, preferred viewing times as well as than viewing time.
How is live TV affected by Netflix’s move towards greater transparency?
Streaming services have always maintained that they are more like television than digital video or social media. These latest metrics indicate that Netflix intends to directly compete with traditional TV for ad spend, by measuring audience size as “audience rating” – the holy grail of TV measurement metrics.
With increased transparency, its campaigns can now be measured alongside TV purchases, while having the added benefit of being able to more accurately profile and target audiences, as with digital channels.
What does this mean for advertisers?
There are four main implications:
1. There will be more impressions available for purchase than ever before, resulting in clear winners and losers in ad spend
2. The line between digital and traditional will become increasingly blurred; which means that agencies and marketers will need both digital and traditional skills to design more effective and holistic integrated strategies
3. The move towards shared measurement will accelerate, now that streaming services and traditional TV are competing on the same playing field
4. Streaming will make TV shopping smarter and more accurate. Over time, this will introduce more sales attributed to TV spendHow Netflix’s New Opening Affects The Ad Industry