2020 drastically shifted the baselines of TV viewership. What did we learn and what’s to come with next-generation TV experiences?

The adoption of in-home lifestyle across work, fitness and entertainment is here to stay.

In 2020, the TV industry saw several years of disruption and innovation compressed into just a few short months. “COVID has accelerated cord-cutting trends that were already underway,” said Tim Sims, chief revenue officer of The Trade Desk. “It’s not because U.S. consumers have fallen out of love with TV, but that there are now more convenient ways of consuming it.”

Time spent with connected TV (CTV) devices increased 81% year-over-year in 2020, according to Nielsen. The shift was also marked by major movie releases via streaming platforms, defying Hollywood norms and shifting expectations around how they’ll be released in the future. Matched with fierce competition and deep pockets from the likes of Netflix, AppleTV+ and Amazon Prime Studios, these viewership trends have motivated traditional Hollywood studios and major media companies to go all-in on streaming.

In-house analytics is a key driver in crafting a personalized experience and creating original content. 

Algorithms will determine who sees what content, tapping into viewing tendency data to create a unique experience for each viewer. For example, the Hulu home screen will look different based on a person’s watch history, demographics and preferences. More specifically, highlighted titles and the collections on display will vary.

Data is the driving force behind the massive spending required for streaming providers to essentially become film studios and create original content. In 2019, Netflix spent an estimated $15 billion, or 85% of its total spending, on original content. Apple TV+ committed $6 billion before launching its streaming service. Disney+ was part of this trend, too, spending $1 billion in 2020.

There is a limit, however, to what people are willing to spend on streaming services. As more streaming services enter the market people will have to subscribe to multiple services, which can lead to higher spending and diminish the overall experience. Today, there are nearly 300 streaming services available in the United States. About half of people in the U.S., 51% to be exact, say they would not spend more than $20 on streaming subscriptions. Trade Desk found that these same people are also more than five-times as likely, 72% versus 14%, to choose free or low-cost streaming TV with ads over services with higher monthly subscription fees and no ads.

Cable networks will lose their strongholds of live events such as sports, award shows and local news—all major factors for cord-cutters.

According to a recent Trade Desk survey, only 30% of people cited live sports as a reason to maintain their cable subscription. Viewership for major sporting events, which have historically served as cornerstones for linear TV, fell significantly last year due mostly to the pandemic. As a result, almost 39% of people are now watching primarily via either ad-supported streaming platforms or social media platforms.

The future of TV will be an immersive experience

Virtual Reality (VR) will offer an exciting new opportunity for people to consume content. Facebook, Google and Microsoft, among many other companies, have developed VR technology that could become mainstream in the coming decade. If so, it will have a transformative effect on the entertainment and gaming industries. Not to mention education and accessibility as well.

Shoppable TV is a new and exciting innovation for retailers and marketers. Take Amazon Prime’s Making The Cut. Each week, designs from the fashion competition were immediately available for purchase. While watching, people could buy them in real time. Expect similar concepts from other shows in the near future.

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