CANNES — They used to be two diametrically opposed media business models. But now their worlds are colliding.

“Streaming is no longer a choice of ‘subscription or ads’; it’s now a blend of both,” says Tony Marlow, CMO of LG Ad Solutions.

In this video interview with Beet.TV, Marlow delves into what he calls “the big shift” in consumer behavior around television and connected TV, revealing the journey from the onset of the pandemic to the present.

The Two Phases of “The Big Shift”

Marlow explains that “the big shift” came in two phases. “The first phase coincided with the onset of the pandemic. It was really a hockey stick of adoption for streaming television.”

This initial phase, he notes, was underpinned by subscription services. But now, we’re in the second phase, which is characterized by the adoption of free and subsidized ad-supported models of streaming television. “Before it was all subscription or primarily subscription, now we’re seeing broad-based adoption of these ad-supported models and it’s pretty significant,” he said.

The Rise and Preference for Ad-Supported Models

One stat stands out to Marlow in this conversation:

  • “Eight in 10 TV viewers use ad supported models of streaming. That didn’t surprise me. I actually don’t think it’s going to surprise many people.
  • “The thing that did surprise me though is that 63% actually prefer the ad-supported models over subscription models. 63% – that’s most people.”

This preference for ad-supported models is a dramatic shift from a time when it was almost entirely subscription-based. And Marlow argues that this new type of ad-supported TV presents a whole new advertising opportunity “natively baked into the UI.”

Leveraging the User Interface for Advertising

Research indicates that, between turning the TV on and then ultimately landing on something to watch, it’s almost six minutes.

For Marlow, that is as an opportunity for marketers to connect with their audience using the UI as an advertising canvas. “Hollywood loves it. They love advertising the latest blockbuster that’s available for streaming apps, really enjoy the space,” he said.

But it’s about more than the UI. Marlow believes we’re at the precipice of data fundamentally changing creative efficacy, particularly in the realm of Connected TV (CTV). He states, “CTV enables you to be what I call a performance storyteller where you can drive a brand impact but be highly measurable in terms of the outcome that you drove.”

One of the innovative uses of data is dynamically changing the creative based on data signals. For example, partnering with the Weather Company, LG Ad Solutions can serve ads based on weather patterns.

You are watching “The Transformation Of Television: Connected, Addressable & Outcome-Based,” presented by Go Addressable & Teads at the Cannes Lions International Festival of Creativity. For more videos from Beet.TV’s Cannes Lions 2023 coverage, please visit this page.