Interactive Advertising Bureau
05 August 2020

Member Guest Blog - Rakuten Advertising’s AVOD: The Time is Now Report

Author: Chris Edwards, Director, Business Development EMEA, Rakuten Advertising

AVOD is a free-to-view video-on-demand service funded by ads. It is distinguished from other VOD services that involve a monthly subscription (subscription-based video-on-demand: SVOD) or offer content on a pay-per-view basis (transaction-based video-on-demand: TVOD).

The time is now for AVOD. Research from Digital TV Research predicts the market will more than double globally by 2024 to reach $56bn*. The outbreak of coronavirus also means people have been spending more time indoors which could prompt even more people to consume AVOD content. This Rakuten Advertising study uncovers the AVOD opportunity for advertisers and agencies. The research examines awareness of AVOD and favourability towards the service by surveying almost 5,000 consumers in six countries across Europe: the UK, France, Germany, Spain, Italy and the Netherlands. It reveals how brands can use the channel to reach audiences, both during lockdown and beyond.

Key findings

AVOD provides an opportunity for brands
There is a clear opportunity for brands to reach audiences via AVOD services - 60% of consumers in the UK said they are very likely or somewhat likely to sign up for an AVOD service; 51% in France; 62% in Germany; 71% in Spain; 66% in Italy and 48% in the Netherlands.

AVOD builds on the popularity of VOD
VOD services are second only to traditional TV as the most popular channel to view video content. 30% of people use VOD, placing these services well ahead of video sites (11%) and social media (10%). With consumer appetite for AVOD clear, the VOD audience could be converted to viewing AVOD services specifically.

The impact of coronavirus is set to drive more people to use AVOD services
Once coronavirus is brought under control, 78% of people across Europe believe their use of AVOD will increase or remain the same.

Effective advertising can play a role in growing the scale of AVOD
49% of people say ads that are funny, engaging or entertaining would increase their likeliness of viewing an AVOD service

AVOD can help fill consumers’ content gap
Currently, 64% of people across Europe believe they are missing out on content. This is particularly the case in Spain, where 76% of people feel they are missing out on content. Ad-supported video on demand gives consumers the opportunity to explore what they’re missing out on without having to commit to any additional spend. For those consumers that watch major sporting events, 26% said they would be interested in streaming them on an AVOD service when this was described to them, placing this ahead of all other streaming options, including pay-per-view and monthly subscription services.

For more insights, please download Rakuten Advertising’s report here.

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