Classic linear television remains the main type of television usage, with 64.9 percent of users in 2018 stating it as being their primary source of film consumption. This number fell by 6.1 percent compared to 2017. Video-on-demand (VoD) rose by nearly 30 percent during that period, with 23.1 percent of Germans saying that they primarily use this form of consumption. Younger audiences in particular prefer VoD to linear television consumption. Around 56 percent of 14-29 year-olds favor this type of film consumption.
Apart from the big players such as Netflix and Amazon, the German private television stations and payTV providers are also trying to gain a foothold in the streaming market. All of the big players (ProSiebenSat1, RTL, Sky) have launched their own streaming services. They feature national and international series and films as well as their own productions in order to gain a competitive edge. The shifting trend towards VoD will continue in the coming years. Nevertheless, linear television will remain a big part of television consumption for the foreseeable future.
Social media has been on the rise for some years now and most entertainment options have some form of social media element. This may be Twitter hashtags while discussing political issues or fans posting live concert photos of their favorite artist on Instagram.
It comes as no surprise then, that consumers also use their telephones and other mobile devices while they follow their favorite television program. This second screen is often used to comment on and discuss the programs being watched. This not only increases the reach of the content to the contacts of the people that use the social media options. It can also help to expand advertising messages onto the second screen. Because smartphones collect different user data points than smart TVs, the marketing messages on the TV screen can be enriched and personalized even more.
Programmatic advertising is a technology that lets marketers show targeted marketing messages on individual television devices subject to audience, time and day as well as more granular demographic data. This feature increases the efficiency as well as the effectiveness of the marketing approach. This instrument is often used in combination with artificial intelligence in order to further optimize targeting.
Programmatic advertising has already been used for online marketing on the web and in apps for a long time. Thanks to the increased spread of smart TVs and their connection to the internet, that marketing technology also gets used for linear television more and more. Some 51.6 percent of German households already own a smart television and are therefore targetable via programmatic advertising.
Original content is one of the main reasons for consumers selecting a certain streaming provider. And as the number of streaming services increases, providers are hard pressed to find ways to distinguish their offering. That is why it becomes more crucial for the streaming providers to create and produce their own content that only they offer.
The attractiveness of original content also increases when local storylines and movies are produced, as customers feel more at home with these motion pictures. The trend towards increased local productions is also supported by a European directive: the streaming providers’ catalogues need to consist of 30 percent European content. This led Netflix to invest around EUR 1 billion in 2018 to produce 141 European original and co-productions with the goal of increasing that number to 221 films and series in 2019.