Hybrid VOD advertising at heart of streaming's evolution

FreeWheel Video Marketplace Report – H1 2023: The growth of Hybrid Video On Demand Advertising at the Heart of the Streaming Evolution

Despite continued economic caution among marketers, ad view growth on premium video remained healthy in both the U.S. and Europe in the first half of 2023, with 6% and 15% growth respectively. There continues to be significant regional differences in viewing habits. Large screen viewing through connected TV (CTV) and set-top-box (STB) platforms make up 81% of ad views in the U.S., while in Europe, audiences split their time between large (53%) versus small screens (47%).

In the U.S., there is an 80% increase in ad placements that utilize audience targeting, part of a trend towards refining the viewer experience through a push for relevancy in the ads served to individual viewers. Whereas in Europe, due to stringent data regulations (such as GDPR) and less data fluidity, targeting is primarily based on demographics.

U.S. ad views are evenly split across live and video-on-demand (VOD); in Europe — where free ad-supported streaming television (FAST) adoption is slower and linear remains strong — audiences are largely accessing video on demand (82%) to watch long-form content. The Live opportunity has not yet been realized, accounting for only 18% of ad views.

With available inventory increasing, particularly with the proliferation of HVOD services, optimising the consumer viewing experience is more than ever becoming a critical consideration for media companies.

The FreeWheel Video Marketplace Report (VMR) highlights the changing dynamics of how enterprise-class content owners and distributors are monetising premium digital video content. The data set used for this report is one of the largest available on the usage and monetisation of professional, rights-managed ad supported video content worldwide and is based on aggregated advertising data collected through the FreeWheel platform. In this edition of the VMR, we explore video advertising trends for the first half of 2023 (1H 2023) in the U.S. and Europe*.

* European countries included: Belgium, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Netherlands, Spain, and the United Kingdom