Connection Counts in OTT: Part Six— Acting on the Future of TV, Today

Post on July 23, 2020 by PubMatic

PubMatic

What inspired former Calgary Canucks player-turned TV-producer Michael Lowe to launch Kidoodle.TV in 2014 was the need to create consistently safe content for kids. Horrified by his young son’s reaction to a video he’d just watched on YouTube, Lowe created a subscription-based streaming service where every piece of content was guaranteed safe and age-appropriate, making the viewer experience comfortable for kids and parents alike.

But a subscription product aimed at millennial families who were already facing a host of other expenses had an inherent problem. When subscription fatigue inevitably set in, it became clear that the company would need to offer a free ad-supported model, which it introduced in 2018. This approach has been wildly successful, making Kidoodle the fastest growing OTT streaming service for kids on CTV. However, by introducing advertising content that the company had not curated itself, Kidoodle also risked undermining the safe viewer experience that was its hallmark.

The solution, explains Kidoodle chief technology officer Daniel Riddell, was creating an internal process that combined software and real-time human review to make sure the quality of the ads matched the quality of the overall content. Since the process—which takes no more than five minutes per ad—was released this past April, the company has reviewed some 25,000 unique ad creatives—and approved about 70% of them as being safe for the Kidoodle audience.

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“We needed to flatten the waterfall and make sure that all demand providers had equal access to our inventory in a real-time auction.”

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Only Part of the Problem

Brand safety, however, was only part of the viewer experience problem that Kidoodle faced. Like other publishers in the OTT/CTV space, Kidoodle had experienced problems with repetitive ads, competitive positioning, and latency. And those could be just as jarring to an audience of kids as they could be to adults. Moreover, notes Riddell, the waterfall system so prevalent in so much CTV “doesn’t work in a real-time environment,” like that provided by Kidoodle. “We needed to flatten the waterfall and make sure that all demand providers had equal access to our inventory in a real-time auction.”

Jonas Olsen, vice president of video at PubMatic, a digital programmatic innovator, has seen that problem play out all across the new television landscape. “In the new world of TV, where everything happens in real time and you have an auction running every 200 milliseconds, you cannot control that content because you have no idea what is happening,” he says. “It’s much more volatile in the new world of TV than it used to be in the linear TV world. It’s harder to protect yourself.”

And television, Olsen adds, is so much more broadly defined than it ever was. “What is television today?” he asks. “Is it only something you watch on a big screen in your living room or is something you watch on your mobile device on your way to work or on a screen in an airplane.” The key to success in the evolving world of television, he says, rests in “the ability to run a true omnichannel strategy, engaging consumers across every single screen with a TV-like viewing experience.’”

Just Getting Started

One step in that direction, says Olsen, is OpenWrap OTT, a server-to-server header bidding product that PubMatic launched in June to solve for such problems as latency, repetitive ads, and the lack of competitive separation at the same time that it provides the best possible yield for publishers and the best possible experience for viewers. “The efficiency of implementation is there for publishers,” says Riddell, whose company has signed on with OpenWrap. “It’s a very quick integration process and provides better end user experience and better monetization of the inventory overall.”

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Riddell predicts “we’ll see an accelerated shift of budgets away from traditional linear to OTT and CTV environments—by a factor of three to five times.”

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But given the speed at which television is advancing, solving for these problems is only the beginning.

Due in part to COVID and the homebound population’s dramatic increase in viewership, says Riddell, “advancements that streaming services would have made in a decade have been condensed into a year.” Kidoodle, for one, has realized over 240% growth since the start of COVID and is still seeing more than a 30% month-over-month growth rate. Riddell predicts that overall “we’ll see an accelerated shift of budgets away from traditional linear to OTT and CTV environments—by a factor of three to five times what it would have been.”

Olsen notes that “Brands will need to reach consumers when they’re most receptive, using machine learnings to know what ad content to choose for which audiences. Publishers will sell an audience across screens, and buyers can reach those audiences on any screen at the point when they’re most receptive. The smarter we get about this, the better we can customize the ad pods and the better the user experience.”

Farewell to Traditional Ad Serving

And this, Olsen suggests, will change the game for ad serving within a year.

“Traditional ad serving will fade away,” Olsen contends, “because agility and flexibility are coming to rule the TV space. Why should a buyer pay a guaranteed amount for a show that airs months away in an upfront, when you can now buy in real time—for the price that the market determines at that particular time? Advertisers are going to spend their money where and when they know they are going to reach their audience.”

For brands with a family-focused audience, Kidoodle might just be the answer, just as the direction in which Kidoodle has moved to match ad quality to content quality is likely to work for publishers focused on other demographics. “We’ve done a study to gauge parents’ attitudes about streaming,” says Karina Vasquez, Kidoodle’s director of B2B marketing, “and 95% said they need better options for managing the content their kids are exposed to. That plays a factor in terms of how both the content and the environment in which that content exists is working to alleviate parental concern.” And given the success Kidoodle has achieved, it seems the network—which now auto-plays a lesson in COVID-preventing handwashing whenever the channel comes on—is one publisher that is firmly positioned for just the kind of success that Olsen has envisioned.

Originally published in MediaPost