Video on Demand (VOD) is a rapidly growing form of television. The excitement comes from its double-digit growth, particularly in the “TV Entertainment” category, which consists of free programming put up by the traditional broadcast and cable networks, as well as VOD-only networks. Viewers are finding out that their favorite programs don’t have to be DVR’d, and that when a friend mentions a new show, more often than not, it can be found On Demand.
The VOD industry is also moving in an exciting direction to start sharing data. Rentrak has been producing a “Transparency Report” since January 2012. Forty-eight cable networks first agreed to allow monthly data to be shown. That number has grown to more than 60 cable networks. (As I write this, there are no broadcast networks participating.) I thought my loyal fan base (including the guy with the court order to stay back 500 feet) would be interested in a top line peek.
I first took all the 2012 reporting VOD networks and averaged their results over the first half of 2012. I then graphed them out by what is important to media planners and buyers—reach and frequency. Reach is important because it determines the breadth of the target audience. Frequency is important because it reflects how often ads can be delivered.
In the graph below, the horizontal axis is the average monthly reach, or unique set-top boxes that watched a program on a network. The vertical axis is the average number of times a network was watched per month. The intersection of the two axes is at their respective averages, creating a quadrant map. I’ve labeled the networks that have both high reach and high frequency; they are the ones in the upper right-hand quadrant.
Clearly, Music Choice is a strong outlier, with an average frequency more than four times higher than other networks. The video music format obviously is a big draw for repeat viewing. Also interesting to note is the presence of kid’s networks like Nick Jr., Cartoon Network, and Nickelodeon. Children are “early adopters,” and are masters of the push button (and screen swipe). A&E, TruTV, TBS and Comedy Central round out the quadrant.
However, the picture changes a bit if we look at another key metric—time. The quadrant map below looks at the same networks but has the number of minutes a network was watched on the vertical axis. While the three children’s networks stay in the upper right quadrant, Music Choice slips to the edge. Music Choice, because it is a short form genre, obviously could have many viewers and a lot of frequency yet less dominance in time spent. More networks with longer formatted programs join the quadrant: AMC, History Channel, Impact, Lifetime, MTV, TLC, TNT and VH1. Comedy Central stays on the edge of the quadrant.
I’d be a bad researcher if I said this is a definitive look at VOD. Not all networks have agreed to be transparent, and I haven’t even shared with you all the networks we do have data on.
Finally, when you think about those millions of VOD viewers, just waiting for someone to put in a super impactful pre-roll ad as they settle into watch the program they have deliberately decided to engage with, doesn’t the ad man (person) in you salivate? I know I do! And these Rentrak transparency reports will help build the marketplace to make it happen.
More information on VOD can be found in Rentrak’s State of VOD: Trend Report and monthly transparency reports. Please contact Gordon Jones, Rentrak’s VP, OnDemand Everywhere, at email@example.com if you are interested in either of these reports.
In case you don’t know, I am Bruce Goerlich, Chief Research Officer at Rentrak, the global standard in movie measurement and your TV Everywhere measurement and research company. I have been in the research end of the marketing business for more than 30 years primarily on the ad agency side, with my last stint prior to Rentrak in the role of President, Strategic Resources Zenith Optimedia North America. Somewhere along the way I morphed from young Turk to old fogey. Now that I have grey hair and am horizontally-challenged, I can speak with some authority on advertising and research issues – which I will do from time-to-time on this blog.