Smart TV, also known as over-the-top (OTT), is the newest and fastest growing platform for major advertisers. The development of the industry for big screen and on-demand devices continues to mature, with the penetration rate of OTT in 2017 exceeding 50%, and shipments of OTT television sets and set top boxes reaching 260 million units. This emerging media platform, which combines the advantages of traditional big screen TVs and the Internet, provides consumers with a better visual experience and a richer platform for advertisers.
In 2017, Nielsen China introduced the OTT methodology to its Digital Advertising Ratings (DAR) solution, combining more than a decade of development experience to provide the industry's most accurate, steady and effective digital advertising measurement solution.
According to Nielsen, among OTT users, daily users have reached 68%. Of that, 56% of them watch programs every day through OTT, while more than 80% are viewing more than 5 days a week. About 42% of OTT users watch 2-4 hours on average a day. The patterns for this kind of Internet TV reflect mainly family group viewing and turning on the TV around 4 times per day.
The overall age of OTT smart TV users tends to be older. Among them, 23% are over 40 years old, compared to just 9% for OTV. Based on income, household exposure to OTT tends to be high to middle-income groups, with 30% of users, measured by households, attaining a monthly income exceeding RMB 15,000, while 80% have monthly incomes of more than RMB 5,000. A closer look at an OTT household shows an individual with an average monthly intake of RMB 5,171 with the family’s average around RMB 12,251 and a family car valued around RMB 128,200.
The development of OTT is a “three-in-one” win for advertisers, media agents and publishers. For advertisers, the big screen means one ad exposure can reach more potential customers; for media agents, OTT offers more flexible ways to reach a targeted audience; and for publishers, how to expand this new digital screen market will be the key to winning.
The market growth and differentiation in OTT has also raised new issues for third-party online advertising monitoring. There are three major challenges to precisely measuring the effectiveness of OTT advertising and better serving advertisers: 1) getting precise measurements through accurate consumer portraits; 2) getting access to data and rendering data de-duplication across screens; 3) getting an accurate assessment of screens and users. Once again, Nielsen’s DAR leverages a combination of real big data sources as well as tested data science methodologies to unlock insights into OTT big screens.
Nielsen actively collaborates with a number of big data partners to use the unparalleled massive pool of information offered in big data to explore cohesive solutions for a range of problems. As with any data, its characteristics can reflect certain advantages as well as features. This means appropriate calibration and scientific modeling is required before applying big data to make accurate and representative measurements.
From its cooperation with Facebook in the United States where it got its start, to the localization of its digital cooperation with Tencent and Weibo in China, Nielsen's DAR covers 34 countries and markets around the world. We adhere to the use of the Trueset real audience library that is audited, transparent and reliable from the Media Rating Council (MRC) to verify the real social attributes of the audience behind different platform devices and further improve the representativeness and accuracy of big data. Scientific data methodology establishes a precise audience model for each ad exposure, measuring the age, gender, income level, family make-up, vehicle ownership and other characteristics.
As the core data partner of Nielsen’s DAR, Tencent is the cornerstone of Nielsen's OTT audience data. In addition, Nielsen deeply understands the rapid and differentiated development of OTT in the Chinese market and actively cooperates with various participants. Nielsen’s DAR works with a number of smart device platform operators to integrate data from OTT and underlying software development kits (SDK), allowing more devices to further enrich the Nielsen OTT audience identification library. With an eye on ensuring full data coverage, Nielsen also has the capabilities to de-duplicate across screen segments.
OTT is not only a traditional TV screen, but also a smart digital screen. The viewing scene for the OTT screen is like that for traditional TV - its audience is a single individual or a family group. Yet at the same time, the equipment for OTT is digital. Each OTT device is a mobile intelligent terminal with its own unique digital identifier that can be recorded and measured. As the creator of traditional TV ratings, Nielsen deeply understands the audience distribution behind each TV screen. Cooperation with telecom operators allows Nielsen to further use massive data to truly understand the relationship between OTT TV and the audience, allowing for the actual audience behind each OTT to be measured more comprehensively and accurately.
Leading Chinese smart device data operator Gozen Data Chairman Yu Liangxing said: "The media value of smart TV is being widely recognized by market participants. However, how to accurately measure the content and advertisements broadcast on this kind of screen and how they correspond with the type of audience watching the screen are the key to whether the value of the smart TV media can be fully reflected. We work with Nielsen on product cooperation and hope to combine the advantages of both sides to provide real, objective data and rich insights on smart TV content and the advertising industry.”
Speaking about cooperation with Nielsen, Niu Gang, deputy general manager of China Telecom Group’s Best Tone Information Service Co Ltd said: “The same user accessing the Internet on a variety of devices has become very common. Identifying duplication across screen usage has become a sore point in the industry. Applying China Telecom's big data advantage, Best Tone Information has set up a multi-screen big data laboratory. Together with Nielsen, a leader in the advertising measurement industry, we are jointly researching and developing solutions for media planning and audience group insights for multi-screen advertising."