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Roku Sales Exec: ‘AVOD Is Surging Because the Ad Experience Is Getting Better’

Roku East Coast ad sales exec Kristina Shepard
(Image credit: Roku)

Gotta be the shoes?

Executives in and around the business of ad-supported video-on-demand, aka “AVOD,” have struggled to put their finger on just what’s behind the sector’s explosive growth recently, which seems outsized even amid the incendiary overall TV viewing uptick of the pandemic era. 

“The pandemic really accelerated the AVOD market,” said Tubi’s VP of Global Business Development, Andrea Clarke-Hall, speaking at a virtual panel event Thursday. “Overnight, we were put on the map. Viewership surged. Brand-awareness surged. I know certainly in early days of the pandemic there was concern that ad dollars would dry up and that went away really quickly. We’ve seen record revenue, quarter after quarter. Numbers that just last year were a pie in the sky.”

For her part, however, Kristina Shepard, head of East Coast sales and agency partnerships for Roku, distilled the increased consumer demand to a more simple explanation: Streaming companies have improved their AVOD offerings. Roku’s aim to elevate customers' experience from an advertising perspective is in part why advertising based content viewing is growing, Shepard said.

“It's growing because the ad experience is getting better,” Shepard said, speaking alongside Clarke-Hall at the MediaRadar-produced event,  The Future of AVOD: What to Expect in 2021

“It's more relevant,” she added. “Hopefully we can solve for frequency because we know that's still a common objection we hear about the ecosystem.”

Shepard said Roku relies on advertising research to prove brand value via the company’s “unique ACR (automatic content recognition) data.”

The AVOD market is in part spearheaded by the Roku Channel. The Roku platform finished 2020 with 51.2 million active accounts— up 39% year to year. Roku "platform revenue"--which is, in large part, made up from money it makes selling ads on the Roku Channel--was up 71% to $1.268 billion in 2020

In terms of minimizing ad pods and instead developing contextual partnerships and relevant content integration, Clarke-Hall said that ads will become more and more dynamic especially when it comes to VOD content.

 “There will be more and more experimentation in terms of the types of ads and product placement,” she said. “The challenge has been thus far, not the technical ability, but the dollars. We've tried to make it look as similar as we can to live in your TV. To make that migration really easy. I think as more and more dollars come and people get more comfortable with that OTT ecosystem, you'll start to really see a lot more cool ad products that that provide a lot more direct response.”

 Shepard added that programmatic ad buying is the future.

“What clients are asking us for can simply only be done in a one-view platform environment,” she said. “They want that holistic reaching frequency. They want a decision in real time based on if they've over frequency of consumer. They want to then pivot to someone else. They want to pivot to different platforms. They want to drive business outcomes. All of that just is simply really done the best in programmatic environment.”