As more consumers cut the cord on linear television, connected TV (CTV) and over-the-top (OTT) viewing platforms are continuing their meteoric rise. Advertising is keeping pace with that growth—CTV advertising alone is projected to exceed $27 billion in profits by 2025. Within this sector, advertising-based video on demand (AVOD) is outpacing subscription video on demand (SVOD) in the United States, due partly to record-high inflation rates and a shrinking global economy. Market research firm Statista predicts that the number of AVOD viewers will rise from 140 million this year to 170 million by 2026. That spells great news for advertisers, many of whom believe kids content is a stellar—and previously untapped—means of reaching CTV consumers like tech-savvy, cost-conscious millennial parents. Here’s what you need to know about tapping into the kids streaming market.
Allure of AVOD
A recent report from market research group TVREV found that AVOD services offering content for children are an attractive advertising option in the era of cord-cutting. After consulting with ad agency executives, media buying agencies, ad tech companies, CTV apps, brands, studios and makers of streaming devices, TVREV concluded that consumers are now spending more time on streaming than linear and watching as much ad-supported CTV as ad-free platforms, with ad-supported shows for children shining as the brightest CTV spots. In short, “ad-supported kids and family programming on CTV should prove to be a gold mine,” according to one ad-tech exec.
When looking to connect with consumers in the past, advertisers who invested in AVOD didn’t know where their ads would air because platforms don’t have to tell them. That’s long been seen as one of this market’s biggest drawbacks: a lack of transparency as to where spots run when placed programmatically via the open auction process. But since all programming for kids must adhere to strict regulations established by the Children’s Online Privacy Protection Act (COPPA), Industry Analyst and TVREV Cofounder, Alan Wolk, predicts ad-supported family shows will knock down that hurdle. Since all kids’ ad inventory must be bought directly from a programmer, brands will know everything about where their ads are appearing—from shows to air times to position within an ad pod. What’s more, ad inventory for kid-friendly CTV channels is currently affordable—though that’s bound to change. As more families continue signing up for more streaming services, the value of CTV programs and platforms should likewise increase, said Wolk.
Fast, Good, Free
Within the CTV market, free ad-supported TV (FAST) is among the quickest-growing components. Popular FAST platforms include Pluto, Samsung and Roku, among others, and they’re characterized by being free of charge to viewers (read: no option to subscribe) and supported via advertising. Content for kids is now becoming a great way for FAST services to differentiate themselves during the ongoing streaming wars. There are currently 82 platforms dedicated to kids’ programs and episodic content, which previously existed on linear TV channels or digital platforms like YouTube. A single channel playing strictly kid-friendly movies can be found on Pluto TV. Apart from that, most FAST kids’ channels are run by digital companies many consumers probably haven’t heard of, like NEW ID’s “Pinkfong Baby Shark” channel, Lego Group’s “The Lego Channel” or ToonGoogle’s “ToonGoogle,” to name a few. This marks a break from traditional kids’ cable channels where big-name networks (Nickelodeon, Cartoon Network, PBS Kids) are ubiquitously available regardless of provider. Some experts believe it also presents an additional opportunity for upcoming AVOD kids programming.
Case in point: the Jim Henson Company, which is known for its innovations in the field of puppetry, just announced a partnership with Shout! Factory, a multi-platform media company, to bring 13 kids’ series and specials to the company’s Shout! FactoryTV AVOD platform. Content will include Henson’s Emmy-nominated sci-fi series Farscape, plus additional beloved classics like Jim Henson’s World of Puppetry, Lighthouse Island, Living with Dinosaurs and Dog City. “FAST Channels are the wave of the future in terms of getting your content front and center for both devoted fans and new audiences,” said Kerry Novick, Jim Henson’s VP of global distribution.
SVOD Shows and Films
In addition to ad-supported models, many streaming platforms also offer subscription services boasting a wide range of programming made for families. Disney Plus promises the full library of both Disney and Pixar staples, with timeless hits ranging from Bambi (made in 1942) to Mary Poppins (a triumph from the 1960s) to Frozen and Moana (21st century cult classics). Netflix (which plans to debut its own ad-supported model in early 2023) is the place to go for beloved British movies like Paddington or television series such as The Octonauts. Additional international offerings include Japan’s Spirited Away plus My Neighbor Totoro, made for toddlers in 1988. Amazon Prime is a great stop for older kids—Wes Anderson’s stop-motion hit, Fantastic Mr. Fox, or the enduring ‘80s hit, The Neverending Story. Here’s to many hours of happy and safe family viewing!