What Advertisers Can Learn from Fox and Amazon’s New Streaming Strategies

Brendan Gill  | 

Over-the-top (OTT) video services continue to gain favor with both consumers and advertisers alike. They’re so popular that last month there were two big new streaming service announcements. Amazon is planning to open up its popular steaming platform to new ad-supported channels, while Fox News is preparing to launch its own stand-alone streaming service targeting cord-cutting viewers. But these two business moves aren’t just important for Fox and Amazon. They reveal a lot about the current state of advertising and content consumption on all streaming platforms, while also offering a glimpse of what these platforms might look like for advertisers in the future. Here are three takeaways.

Ecosystems Are Key to Building Scale
If there’s one “big” lesson that broadcasters and video advertisers are discovering about OTT and streaming video, it’s that size matters. The more content options publishers can offer, the more likely that viewers will stick around, and advertisers too. For Amazon, this means extending its existing offering of subscription channels like HBO and Showtime to soon include new ad-supported partners like CBS’ “All Access” channel. Looking beyond Amazon, it’s the same strategy that’s helping to drive the pending mega-mergers of content powerhouses like Disney and Fox or AT&T and Time Warner. More content means more viewers and, ultimately, more opportunities for advertisers to reach more consumers.

Audiences Matter More Than Ever
As noted above, size and scale are important considerations for video-focused advertisers and media buyers. But in this competitive environment, with a shrinking range of media giants like Amazon, Disney, Google, Verizon, Facebook and AT&T fighting for ad dollars and content, smart publishers also need to be able to differentiate themselves by offering coveted audiences to advertisers. That’s why more media companies are building approaches that help them build loyalty with specific audiences. It’s the approach behind Fox’s new streaming-only Fox Nation service, which is designed to appeal to the network’s “superfans.” It’s also the thinking behind ESPN’s upcoming “Plus” subscription service, which will carry lesser-known sports broadcasts not typically shown on the main ESPN broadcast channels.

Convenience Is King
Perhaps the most important takeaway from these two new streaming offerings is the power of convenience. The growing range of streaming services now available to consumers emphasizes the importance of access to great content at all times on all devices. That’s why advertisers and broadcasters must do more to ensure they are adapting their own approaches to address that new reality, whether it’s new ways to watch or new ad formats. As one Fox executive associated with the Fox Nation launch remarked, viewer demand played a key role in the network’s decision to create their streaming product. They “…value our product so much, they go to hotels and if they can’t have Fox, they send us emails. They go on cruises, and if they can’t have Fox, they send us emails,” said John Finley, who oversees program development and production for Fox News, in an interview with the New York Times. “This is a way for us to meet that demand.”

Fox and Amazon are just two of the many companies competing for viewer attention and advertising dollars in today’s increasingly crowded streaming environment. But these two new streaming offerings are also symbolic of broader shifts shaping today’s video streaming landscape, including the importance of achieving scale with viewers, the power of niche audiences, and the value of convenience. But perhaps even more important to understanding these two companies’ strategies is the power of flexibility. No matter the platform or device, advertisers will need to be ready to adapt and experiment as today’s dynamic video and TV environment continues to evolve.

Recommended Posts