roku dominating connected tv advertising space · roku dominating connected tv advertising space...

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www.spotsndots.com Subscriptions: $350 per year. This publication cannot be distributed beyond the office of the actual subscriber. Need us? 888-884-2630 or [email protected] Copyright 2019. The Daily News of TV Sales Monday, December 23, 2019 ESTIMATES POINT TO GROWING MARKET SHARE Roku has seen its advertising business gain considerable strength in recent years. Its platform business has generated more than $630 million in revenue over the trailing 12 months, and it grew 79 percent year over year last quarter. Management has said that advertising accounts for as much as 75 percent of its platform revenue in some quarters. This year, Roku will generate about $600 million in ad revenue, according to RBC Capital’s Mark Mahaney. Ad revenue will grow 2.5 times over the next few years, reaching $1.5 billion in 2022, Mahaney says. Meanwhile, U.S. connected TV ad spending is only expected to grow at about half that rate in the same period based on a forecast from eMarketer. Despite increased competition in connected TV advertising from Amazon as well as a push by traditional pay-TV providers to move into the connected TV space, Roku is growing its share of the burgeoning advertising market. The amount of ad inventory Roku controls is quite impressive, The Motley Fool says. It has 32.3 million active accounts spending an average of more than 3.5 hours per day on its platform. A growing percentage of those users are using one of Roku’s smart TVs, which the company says account for about one-in-three smart TV sales in the U.S. Roku accounts for 44 percent of all streaming hours in the U.S. Its next closest competitor, Amazon, totals just 20 percent of streaming. The size of Roku’s highly engaged audience enables it to demand relatively high ad prices. The company reportedly commands $30 per 1,000 impressions, which is one of the highest rates in the media industry. Roku’s ad rates will keep climbing as it improves its ad technology. It has acquired Dataxu, a demand-side platform for digital video ads. Integrating that into its technology along with continued innovations in tech and ad formats should help it grow ad prices. Roku’s smart TVs offer especially useful data on its users and unique advertising opportunities that Roku still hasn’t yet fully explored. Roku is well on its way to more than doubling its ad revenue, but it’ll face competition. Amazon has a growing number of display ad formats for its Fire TV home screen as well as a growing stake in ad-supported streaming. The company moved to demand ad inventory in most ad-supported streaming services last year, and it launched its own ad- supported streaming service, IMDb TV, earlier this year. Meanwhile, Comcast and AT&T are pushing their own set-top boxes with a focus on streaming. They also have footholds in traditional TV advertising, and Comcast’s Freewheel is one of the leading TV ad buying platforms. Still, all of them are chasing Roku, which has seen its audience size and engagement grow quarter after quarter. Roku CEO Anthony Wood is keen to point out that marketers still spend about $70 billion on traditional TV advertising, meaning there’s plenty of room for Roku to grow and for the competition to enter the space. ROKU DOMINATING CONNECTED TV ADVERTISING SPACE ADVERTISER NEWS BJ’s Wholesale Club has named company veteran Lee Delaney its new CEO. Progressive Grocer reports the retailer is planning to turn its attention to building its paid membership base and increasing value to shoppers with a smaller selection, improved services and personalized specials in the year ahead... Giant Food Stores has introduced a kid-friendly augmented reality game at 15 stores in Pennsylvania called Giant’s Snowflake Search, Supermarket News reports. It is further appealing to parents through a partnership with the Berenstain Bears franchise, with plans to roll out children’s play centers at some stores... Chipotle Mexican Grill will test new restaurant prototypes in five U.S. markets as part of its focus on growing its digital business, CNBC reports. Formats include a storefront for urban areas and standalone units with a drive-thru, and all will feature walk-up windows and dedicated spaces for order pickup... Second-hand sales of clothing and fashion items on platforms like Poshmark, ThredUp and Depop are set to climb from $24 billion to $51 billion in the next five years, GlobalData and ThredUp predict. The number of women who made second-hand fashion purchases grew from 44 million in 2017 to 56 million last year, Fast Company reports... The early buzz around subscription services like Blue Apron has cooled, but the industry still has significant room to expand, a McKinsey report says. Sales at the largest subscription services grew 30 percent to $7.5 billion last year, McKinsey estimates... The number of holiday package deliveries is expected to surge 21 percent this year, and with bad weather compounding the pressures of the shortened selling season, carriers are sucking wind trying to keep up. CBS News says FedEx’s on-time delivery rate has reportedly dropped to about 68 percent season this season from 77 percent last year, and UPS’s is down from 86 percent to 80 percent... Walmart has demonstrated in recent years its strategy to broaden its appeal to higher income demographics. The chain is now upscaling its adult beverages aisles with hyper-local craft beers and higher- priced wines and liquor, Business Insider reports. Among the newly introduced items: hard seltzers, low-calorie IPAs, Buffalo Trace bourbon and Veuve Clicquot champagne... Google search is driving significantly more traffic to retail sites than Facebook and Instagram, according to a report by business intelligence firm Oribi reported by Marketing Dive. Organic search on Google drove 23 percent of all traffic, while paid search was responsible for 12 percent. In contrast, Facebook generated 6 percent of retail site visits. Instagram... Rite Aid reported net income of $52.3 million for the third quarter of fiscal 2019, compared to a net loss of $17.3 million during the same period a year earlier. Adjusted EPS of $0.54 were substantially higher than analyst projections of $.07 per share. Rite Aid also surpassed Wall Street expectations with revenue of $5.46 billion, up slightly from $5.45 billion and ahead of a projected $5.42 billion.

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Page 1: ROKU DOMINATING CONNECTED TV ADVERTISING SPACE · ROKU DOMINATING CONNECTED TV ADVERTISING SPACE ADVERTISER NEWS BJ’s Wholesale Club has named company veteran Lee Delaney its new

www.spotsndots.comSubscriptions: $350 per year.

This publication cannot bedistributed beyond the office

of the actual subscriber. Need us? 888-884-2630 or

[email protected] Copyright 2019.The Daily News of TV Sales Monday, December 23, 2019

ESTIMATES POINT TO GROWING MARKET SHARE Roku has seen its advertising business gain considerable strength in recent years. Its platform business has generated more than $630 million in revenue over the trailing 12 months, and it grew 79 percent year over year last quarter. Management has said that advertising accounts for as much as 75 percent of its platform revenue in some quarters. This year, Roku will generate about $600 million in ad revenue, according to RBC Capital’s Mark Mahaney. Ad revenue will grow 2.5 times over the next few years, reaching $1.5 billion in 2022, Mahaney says. Meanwhile, U.S. connected TV ad spending is only expected to grow at about half that rate in the same period based on a forecast from eMarketer. Despite increased competition in connected TV advertising from Amazon as well as a push by traditional pay-TV providers to move into the connected TV space, Roku is growing its share of the burgeoning advertising market. The amount of ad inventory Roku controls is quite impressive, The Motley Fool says. It has 32.3 million active accounts spending an average of more than 3.5 hours per day on its platform. A growing percentage of those users are using one of Roku’s smart TVs, which the company says account for about one-in-three smart TV sales in the U.S. Roku accounts for 44 percent of all streaming hours in the U.S. Its next closest competitor, Amazon, totals just 20 percent of streaming. The size of Roku’s highly engaged audience enables it to demand relatively high ad prices. The company reportedly commands $30 per 1,000 impressions, which is one of the highest rates in the media industry. Roku’s ad rates will keep climbing as it improves its ad technology. It has acquired Dataxu, a demand-side platform for digital video ads. Integrating that into its technology along with continued innovations in tech and ad formats should help it grow ad prices. Roku’s smart TVs offer especially useful data on its users and unique advertising opportunities that Roku still hasn’t yet fully explored. Roku is well on its way to more than doubling its ad revenue, but it’ll face competition. Amazon has a growing number of display ad formats for its Fire TV home screen as well as a growing stake in ad-supported streaming. The company moved to demand ad inventory in most ad-supported streaming services last year, and it launched its own ad-supported streaming service, IMDb TV, earlier this year. Meanwhile, Comcast and AT&T are pushing their own set-top boxes with a focus on streaming. They also have footholds in traditional TV advertising, and Comcast’s Freewheel is one of the leading TV ad buying platforms. Still, all of them are chasing Roku, which has seen its audience size and engagement grow quarter after quarter. Roku CEO Anthony Wood is keen to point out that marketers still spend about $70 billion on traditional TV advertising, meaning there’s plenty of room for Roku to grow and for the competition to enter the space.

ROKU DOMINATING CONNECTED TV ADVERTISING SPACEADVERTISER NEWS BJ’s Wholesale Club has named company veteran Lee Delaney its new CEO. Progressive Grocer reports the retailer is planning to turn its attention to building its paid membership base and increasing value to shoppers with a smaller selection, improved services and personalized specials in the year ahead... Giant Food Stores has introduced a kid-friendly augmented reality game at 15 stores in Pennsylvania called Giant’s Snowflake Search,

Supermarket News reports. It is further appealing to parents through a partnership with the Berenstain Bears franchise, with plans to roll out children’s play centers at some stores... Chipotle Mexican Grill will

test new restaurant prototypes in five U.S. markets as part of its focus on growing its digital business, CNBC reports. Formats include a storefront for urban areas and standalone units with a drive-thru, and all will feature walk-up windows and dedicated spaces for order pickup... Second-hand sales of clothing and fashion items on platforms like Poshmark, ThredUp and Depop are set to climb from $24 billion to $51 billion in the next five years, GlobalData and ThredUp predict. The number of women who made second-hand fashion purchases grew from 44 million in 2017 to 56 million last year, Fast Company reports... The early buzz around subscription services like Blue Apron has cooled, but the industry still has significant room to expand, a McKinsey report says. Sales at the largest subscription services grew 30 percent to $7.5 billion last year, McKinsey estimates... The number of holiday package deliveries is expected to surge 21 percent this year, and with bad weather compounding the pressures of the shortened selling season, carriers are sucking wind trying to keep up. CBS News says FedEx’s on-time delivery rate has reportedly dropped to about 68 percent season this season from 77 percent last year, and UPS’s is down from 86 percent to 80 percent... Walmart has demonstrated in recent years its strategy to broaden its appeal to higher income demographics. The chain is now upscaling its adult beverages aisles with hyper-local craft beers and higher-priced wines and liquor, Business Insider reports. Among the newly introduced items: hard seltzers, low-calorie IPAs, Buffalo Trace bourbon and Veuve Clicquot champagne... Google search is driving significantly more traffic to retail sites than Facebook and Instagram, according to a report by business intelligence firm Oribi reported by Marketing Dive. Organic search on Google drove 23 percent of all traffic, while paid search was responsible for 12 percent. In contrast, Facebook generated 6 percent of retail site visits. Instagram... Rite Aid reported net income of $52.3 million for the third quarter of fiscal 2019, compared to a net loss of $17.3 million during the same period a year earlier. Adjusted EPS of $0.54 were substantially higher than analyst projections of $.07 per share. Rite Aid also surpassed Wall Street expectations with revenue of $5.46 billion, up slightly from $5.45 billion and ahead of a projected $5.42 billion.

Page 2: ROKU DOMINATING CONNECTED TV ADVERTISING SPACE · ROKU DOMINATING CONNECTED TV ADVERTISING SPACE ADVERTISER NEWS BJ’s Wholesale Club has named company veteran Lee Delaney its new

PAGE 2 The Daily News of TV Sales @ www.spotsndots.com

AVAILS Research Director, Phoenix: Want a chance to use your skills beyond cranking out one sheets? Do you need to get creative to get out of the research rut? How about the added bonus of sunshine year around, lush golf courses and amazing gardens? We need the best and brightest for these Meredith stations to find strengths and opportunities – a fresh set of eyes to take the sales research from routine to extraordinary and to find the hidden stories in news research data. Want to become part of the Meredith team? Qualified candidates should apply online at Meredith.com, job # JR07987. EOE.

FOX5 Atlanta has an opening for a Research Director. This position will track ratings for all stations; develop promotional materials, qualitative profiles and positioning pieces for sales staff; create rating estimates for local and national sales teams; and maintain Nielsen station information and remain current with Nielsen-related issues. More duties can be found in our ad online. Candidate must have knowledge of various products, including Wide Orbit

Media Sales and Nielsen Arianna. Candidate should possess excellent communication and computer skills. CLICK HERE to apply. EOE. General Sales Manager: KAKE, the ABC affiliate in Wichita, Kan., seeks an energetic leader to inspire and guide an experienced sales team into 2020 and beyond. The successful applicant will possess a strong track record of revenue generation through digital marketing solutions, understand the value of our various media platforms and how they complement each other, and be able to effectively communicate that value to our sellers and advertising partners. Minimum of 5 years’ experience in Broadcast TV sales management required. Resume to: [email protected]. No calls, please. EOE. Sinclair Broadcast Group is seeking a Regional National Sales Manager, Las Vegas. This role encompasses national revenue management for our stations and digital platforms. The ideal candidate will have a keen attention to detail, be highly organized and demonstrate a proven ability to impact market share and revenue growth, and will demonstrate a strong work ethic, a highly competitive passion to win, and a proven ability to create revenue opportunities on both linear and digital platforms. CLICK HERE to apply. EOE.

Have a great holiday! Spots n Dots returns Dec. 27.

VIACOMCBS GETS MIRAMAX STAKE FOR $375M ViacomCBS has reached a deal to acquire a 49 percent stake in Miramax from Qatar-based owner BeIN Media Group for a total of $375 million, Variety reports. The deal calls for ViacomCBS to pay $150 million in cash up front, plus a commitment to invest $45 million a year for five years to fund new film and TV projects and working capital. ViacomCBS’ Paramount Pictures gets an exclusive long-term deal for worldwide distribution rights to Miramax’s library of about 700 movies. The partners will also work together on developing new projects and reboots and revivals of titles from the Miramax vault. BeIN Media acquired Miramax from private equity owners in 2016. The company sees the ViacomCBS deal as a win in bringing in a partner with strategic assets that can grow the company while still allowing BeIN Media to retain a slim majority stake.

NETWORK NEWS A return 35 years in the making gave Saturday Night Live its biggest ratings in two and a half years. Former SNL star Eddie Murphy’s first hosting stint on the venerable NBC program since 1984 delivered a 2.5 rating in adults 18-49 and 9.921 million viewers overall in Live+Same Day, according to “fast official” Nielsen numbers ordered by NBC. The episode was the highest-rated and most watched edition of SNL since the May 13, 2017 telecast, hosted by Melissa McCarthy (2.7 in 18-49, 10.382 million viewers)... Competition LEGO Masters, hosted by Will Arnett, will premiere on Fox on Wednesday, Feb. 5 at 9 PM (ET). Teams of two will compete against each other in ambitious brick-building challenges until the top teams face off for a cash prize, the ultimate LEGO trophy and the grand title of LEGO MASTERS. Throughout the competition, Arnett, alongside expert judges, will encourage the builders and introduce challenges.

CONSUMER SPENDING STRENGTHENED IN NOV. Consumers boosted spending as they headed into the end of the year, buoyed by a rise in income and an optimistic outlook for the U.S. economy, The Wall Street Journal reports. Personal-consumption expenditures, or household spending, rose a seasonally adjusted 0.4 percent in November from October, the Commerce Department reported last week. The increase came alongside a rise in personal income, which was up 0.5 percent. Spending in November was up 2.4 percent from a year earlier. Consumers also felt better about the economy, according to a survey from the University of Michigan. The survey’s index of consumer sentiment was 99.3 in late December, up from 96.8 in late November and the highest level since May. Households spent 0.5 percent more on goods last month, helping drive the overall rise in spending. Spending on vehicles contributed strongly to the 1 percent increase in spending on long-lasting goods. In a separate report, the Commerce Department said the economy grew at a 2.1 percent seasonally and inflation-adjusted annual rate in Q3, the same as previously estimated. U.S. growth has slowed compared to the beginning of the year, but is expected to continue at a steady pace.

12/23/2019

Conan O’Brien

At some point, the internet is going to run out of space for your Star Wars opinions.

Page 3: ROKU DOMINATING CONNECTED TV ADVERTISING SPACE · ROKU DOMINATING CONNECTED TV ADVERTISING SPACE ADVERTISER NEWS BJ’s Wholesale Club has named company veteran Lee Delaney its new

The Daily News of TV Sales @ www.spotsndots.com PAGE 3

IMPEACHMENT BRINGS RISE IN DAYTIME VIEWING Impeachment programming pulled in a collective Nielsen-measured 12.5 million viewers for the Wednesday day-long hearings and impeachment vote, all with substantial declines in TV advertising airings. During a 12-hour programming schedule from around 8:45 AM to 9 PM, including a House of Representatives debate and vote at the end of the day, NBC averaged 2.6 million viewers, while Fox News Channel had 2.4 million, CBS had 2.3 million, ABC had 2.3 million, MSNBC had 1.5 million and CNN had 1.4 million.

All networks posted generally higher numbers for the programming versus daytime schedules in previous weekday time periods. In primetime, FNC had 4.8 million viewers. MSNBC was next at 3.5 million, followed by CNN at 2.6 million. NBC, the only broadcast network to air some coverage in prime during the 8 to 9 PM hour, earned 4.8 million viewers for the key end-of-the day House vote. During this one hour of primetime, Fox led all networks at 5 million viewers,

while MSNBC had 3.2 million and CNN had 2.8 million.

THIS AND THAT Warner Music Group, Sony Music, EMI and Universal Music Group successfully established that Cox Communications deliberately ignored more than 20,000 of its customers who were repeatedly pirating music the labels owned, a U.S. District Court jury ruled last week. Billboard reports Cox was ordered to pay $99,830.29 for each of the 10,017 musical works pirated by its subscribers... The U.S. is raising the minimum age of buying tobacco and vaping products to 21 nationwide as part of an attempt to crack down on teen vaping. The Wall Street Journal says the plan is part of the spending bill passed by the Senate last week and if signed into law will be effective by September 2020.

ACCOUNT ACTION Kraft Heinz has expanded its relationships with creative agencies Gut and Johannes Leonardo, Ad Age reports. Gut will lead creative on Philadelphia Cream Cheese, while Johannes Leonardo will handle Ore-Ida frozen potatoes, Velveeta Cheese and Shells & Cheese, Bagel Bites pizza snacks and Classico Pasta Sauce. The partnerships go into effect in 2020.

12/23/2019

FunnyTweeter.com

I’m sorry your eyebrows look like

two unruly caterpillars chasing each other

across your forehead.

SATURDAY NIELSEN RATINGS - LIVE + SAME DAY

NIELSEN: FOOTBALL DOMINATES THE DECADE The past 10 Super Bowls all rank among the 13 most-watched TV programs of all time in the U.S. in total viewers, so naturally they rank as the most-watched shows of the past decade. Perhaps a little more surprising: The top series telecast of the 2010s wasn’t American Idol or This Is Us or The Voice, but the post-Super Bowl premiere of Undercover Boss in 2010. The show, which has CEOs and company heads going incognito among their employees, drew 38.66 million viewers for its series debut. According to Nielsen data from the past 10 years reported by The Hollywood Reporter, well more than half of the 199 most-watched primetime programs of the decade were sports telecasts. NFL games alone account for a full third of list, 67 telecasts in all. There are Super Bowls and conference championships, to be sure, with Super Bowl XLIX in 2015 topping the list with 114.44 million viewers. But the list also includes a host of regular-season games: NBC’s Sunday Night Football from Week 2 of the 2015 season drew an average 26.38 million viewers, who watched the Green Bay Packers beat the Seattle Seahawks 27-17. The Super Bowls of the 2010s have the following all-time ranks for U.S. TV broadcasts, in terms of total viewers: First (2015), second (2014), third (2016), fourth (2012), fifth (2017), sixth (2011), seventh (2013), eighth (2010), 10th (2018) and 13th (2019). Of course, the population of the U.S. is bigger than it’s ever been, so there’s a recency bias to total-viewer rankings. As a percentage of TV households, the series finale of M*A*S*H in 1983 still holds the all-time mark, with 60.2 percent of TV homes tuning in.

CBRE: ONLINE HOLIDAY RETURNS MAY HIT $41.6B Retailers and shippers this holiday season will handle more returns than ever of goods bought online. That’s according to a new report from CBRE, which forecasts that online returns could total as much as $41.6 billion this holiday season. CBRE, whose findings were reported by Chain Store Age, calculates a maximum value for this season’s returns of online purchases at $41.6 billion by applying the standard percentage range for online returns – 15 to 30 percent – to this year’s projected holiday retail sales of $138.5 billion. In contrast, the average return rate for merchandise bought in stores is roughly 8 percent. For its annual report on online returns, CBRE again teamed with Optoro, a technology company that powers returns optimization for retailers and brands. Optoro estimates that the retail industry’s inefficiencies with handling returned merchandise result in $50 billion of lost profit margin each year and more than 10 billion instances of needless shipments and merchandise touches in warehouses. The report also found that various merchandise categories depreciate at different rates when returned to a retailer. For example, fashion apparel can lose 20 to 50 percent of its value over eight to 16 weeks, according to Optoro. Electronics lose 4 to 8 percent of their value each month.