A new question has worked its way into the American lexicon in recent years, and it’s having a fundamental impact on how auto dealers need to reach their customers:
“What shows are you bingeing right now?”
Whether someone was breathlessly anticipating the Season 3 launch of Ted Lasso or their guilty pleasure is a non-stop weekend catching up on Outer Banks, people want to watch what they want, when they want. Bingeing a series has become something of a badge of honor.
The growing phenomenon of streaming services and shows is one of the biggest entertainment trends in recent years. Online video subscriptions soared 26% to 1.1 billion last year, according to a report by the Motion Picture Association. on the theatrical and home entertainment market. The Washington, D.C.-based lobbying group represents the legacy Hollywood studios and Netflix.
The growth of streaming popularity has led to a corresponding shift in marketing, as well. Over-the-Top (OTT) and Connected Television (CTV) advertising is booming.
For auto dealers who want to leverage this trend to reach in-market shoppers, ZeroSum is well-positioned to help. Our Auto-Stream service can quickly help dealers develop and test inventory-based creative that efficiently and effectively targets car shoppers.
Disney Shift to Direct-to-Consumer a Bellwether for Marketers
To best understand the opportunity for auto dealers’ marketing efforts, it’s important to understand what the terms “OTT” and “CTV” mean, as they are similar, but not the same thing. OTT refers to streaming long-form video content via the internet on any device, from services such as Netflix, Amazon Prime Video, Hulu, or Disney+. CTV refers to the hardware that delivers streaming services, including Smart TVs, Chromecast, Apple TV, Roku, and various game consoles that have the capability to stream video content such as PlayStation or Xbox.
OTT and CTV are quickly gaining market share from traditional distribution channels of cable, broadcast, or satellite TV, also known as Linear Television. A great example of this trend came in Disney’s Q1 2023 quarterly earnings call. The company revealed year-over-year growth of their Direct-to-Consumer OTT/CTV advertising revenue of 13% while their Linear Television ad revenue dropped by 5%. Disney is obviously a leading brand in the media landscape. If Disney’s revenue is trending so sharply toward Direct-to-Consumer models, all marketers need to pay attention.
Pandemic Accelerates OTT/CTV Growth
While entertainment and viewing technology was already evolving toward OTT/CTV models prior to 2020, the global pandemic significantly accelerated this growth. Digital entertainment accounted for 76% of global home entertainment and box office in 2020, compared with 48% in 2019. According to the Motion Picture Association. Total streaming service subscribers topped 1.1 billion in 2022 and is expected to reach 4.2 billion total users by 2027.
Streaming services excel at developing niche programming to meet unique interests. Basketball junkies can check out “Last Chance U” to follow the exploits of the East Los Angeles Huskies. Dark comedy more your thing? Give “Dead to Me” a shot. This explosion in highly targeted programming helps auto marketer more easily find niche customers than a mass media approach through linear TV.
OTT Growth Accelerates Cord Cutting
The strong growth in streaming services is likely here to stay as more consumers opt to cut the cord with traditional cable television services.
Here’s an overview of cord-cutting statistics, according to TechJury.net:
- 1 million people will have cut the cord in the US by 2023
- 9 million consumers, or 41.6% of the US population will have cut the cord by 2026
- Nearly all Americans ages 25-34 access TV content through the internet
- Comcast, one of the largest cable providers in the United States, went from 17.6 million subscribers in Q1 2021 down to 16.6 million in Q1 2022
- There were 68.7 million non-pay tv households in 2023. By 2026, it is expected that 80.7 million US households will choose not to use traditional television compared to just 54.3 million households opting for a pay-tv subscription
Cord cutters are no longer only younger customers.
- 74% of consumers aged 18-34 described themselves as cord cutters
- 64% of consumers aged 35-54 described themselves as cord cutters
Finally, actual time spent streaming is growing as well. An incredible 22.6% spike in hours spent streaming on services such as Netflix, Google’s YouTube, and Warner Bros Discovery's HBO Max occurred from last year, while broadcast viewing fell by 9.8% and cable declined by 8.9%.
Auto-Stream Helping Dealers Leverage OTT/CTV
Simply put, if auto dealers are not making OTT/CTV part of their advertising efforts, they are missing significant opportunities. That’s why ZeroSum created Auto-Stream, the world’s only high-performance OTT/CTV video platform for auto dealers. It is built for dealers and automotive marketers to help market the right vehicle to the right person with high-quality OTT/CTV video.
The platform allows dealers and their agency partners to easily create stunning high-quality video ads, complete with professional-sounding voice overs and integrated OEM brand standards. Dealers also can leverage the power of AI to build individual commercials for each VIN, keeping production affordable – and fast. New campaigns can be up and running in less than 24 hours.
AutoStream also allows dealers to take advantage of ZeroSum’s database of national inventory, paired with advanced native audience targeting.
OTT/CTV Helps Nucar Boost Inventory Turn, VDP Visits
ZeroSum began working with Nucar of Tilton in late December 2020, a time when the entire auto industry experienced consistent inventory drops. The dealership group made OTT/CTV a critical part of an integrated program to improve inventory turn and increase VDP visits.
ZeroSum launched Nucar's marketing campaign with social media, digital display ads and paid search, and later added OTV/ CTV ads. This omnichannel marketing approach enabled Nucar to quickly dominate the market. Within six months, Nucar saw a decrease from an average of 40 days to 9 days on the lot at a time when the rest of the market averaged 33 days. The campaign also helped increase VDP visits by 226%.
Dealers Who Embrace Streaming Opportunities Will Create an Advantage
All the evidence in the marketing world points to expanded OTT/CTV opportunities in the future. Local market dominance by traditional cable and broadcast entities are a thing of the past. While traditional media still has a place in a highly integrated campaign, it’s no longer enough for an auto dealer to simply blanket the market with mass TV and newspaper ads and expect people to show up at the dealership.
Smart dealership marketers will embrace the Auto-Stream video platform to meet customers where they spend time today – streaming their favorite shows whenever they want.
Just like Nucar found in their recent integrated campaign, OTT/CTV advertising can be a catalyst for driving significant results. For any dealer who wants to see similar results, they need to give the ZeroSum team a call. We can analyze current marketing efforts, devise a new game plan and quickly get a campaign up and running. And much like consumers are streaming videos on their devices, you’ll soon be seeing customers streaming into your dealership.