A sense of advertising in return for video content
Netflix, which provides a flat-rate video streaming service, increased the number of paying members in Japan by two million to five million in about a year from three million before the COVID-19 pandemic. The high-quality characteristics of video content and the special demand due to stay-at-home orders are considered the main causes. Instead of attempting to investigate the causes, conversely, this article will consider the results. In other words, it will consider the fact that the “sense of advertising” of the Japanese is changing as a result of the spread of Netflix, Amazon Prime Video, and other video streaming services.
Although advertising actually plays an important role, the Japanese can hardly understand it. When Japan achieved modernization 150 years ago, the following question arose: “How can it be that newspapers publish not only articles but also advertising? It is unpleasant to see advertising we do not want in the newspapers we pay for,” it was said.
FUKUZAWA Yukichi contributed an editorial article to the Jiji Shinpo to remove the misunderstanding by such citizens. He said that companies place advertising as some of many who see advertising on newspaper are interested in and purchase the advertised product. Thus, the newspaper subscription costs little as newspaper companies collect news materials and write articles with the advertising fees earned from those companies. In other words, he explained that advertising has the functions of not only providing product information that some citizens want but also supporting the provision of newspaper content that many citizens want.
Even if times change, the principle is the same. The mechanism is that the citizens can watch interesting TV programs for free in return for a trivial labor called advertising viewing. It was not long before the Japanese accepted this business model. Until quite recently, TV programs with legendary high ratings were produced and masterpiece commercials were also created among the TV commercials viewed during those programs.
However… Now, even if it is not free, citizens are pleased to accept the video streaming services. In addition to the overwhelmingly rich video content, it is considered that owing to self‐efficacy they can watch the content they like whenever they want. In the era of diversity, the limitations of TV came to be considered extremely inconvenient and unacceptable; that is, the limited number of video content can be watched only at a point of time and if you do not like it, you have to take time to record the content on video, but still you sometimes miss it.
Thus, the Japanese who used to accept advertising viewing in return for the video content before also have changed their attitude into accepting the paid provision of content but not viewing the advertising.
Problem of advertising avoidance
Some advertising jargon is introduced here. The first one is OTT. It stands for “over the top,” which means a streaming service of video program content via the Internet, independent of the conventional airwaves and cable TV equipment.
This service is broadly divided into two types. One is the subscription model. It includes flat-rate video streaming services such as Netflix and Amazon Prime Video as mentioned in the preceding paragraph. Not only the subscription (flat-rate) but also VOD (video on demand), which means that you can watch whenever you want, are as mentioned above.
The other type of OTT is called AVOD (ad-supported VOD). In other words, in return for being free of charge, this type of VOD adopted the conventional business model in which the video content is provided in return for advertising viewing. This is represented by YouTube.
While TV and TV commercials are unidirectional viewing proposals by the media and sponsors, both VOD and VOD commercials are bidirectional. It is considered that this bidirectionality creates two characteristics:
One is the self-efficacy of viewers towards advertising viewing. Unlike TV, AVOD has the function to skip a part of advertising, giving the viewer side the right to choose whether to view the advertisement or not. The viewers can voluntarily choose to view the advertisement if they think it is useful information for them or if they want to support the video content with the advertisement attached.
The other is the personalization of advertising. VOD analyzes what videos and advertisements the viewers like. On the one hand, it recommends the recommended videos. On the other hand, it selects and distributes the advertisements that each individual is likely to be interested in. It can be a benefit to each individual viewer to easily obtain product information useful for him/ her compared to uniform TV commercials.
Currently, advertising avoidance often becomes a problem not only for the conventional media but also for the new media. It means that the viewers of video content hate the advertising and avoid viewing it.
As mentioned in the introduction, many of the Japanese who learned that a small subscription payment allows comfortable video viewing without advertising now consider advertising as a very annoying presence. Given such circumstances, if unwanted advertising is broadcasted, the viewers not only ignore and press the skip button but also express their complaints via SNS.
Such a trend to avoid advertising leads to the discontinuation of business not only of the conventional media depending on advertising revenue but also of the sponsors. In the long view, if the viewers continue to avoid viewing the advertising, the media and sponsors decline, which leads the viewers to be unable to enjoy the content and products. Nevertheless, if the viewers endure to continue viewing the advertising, it is useless for both the viewers and the media and sponsors. It can be considered as an unfortunate situation.
So, what should we do? Just to confirm, the goal is very simple. The (intermediate) goal of marketing, including advertising, is to satisfy the customers. Advertising aims to be of some help for each customer to be completely satisfied eventually by delivering useful information corresponding to the needs of each customer and advertising content which itself is like enjoyable and impressive entertainment. Furthermore, advertising in the OTT industry is provided via the Internet. In so doing, any side effects, such as an uneasy feeling of invasion of personal information, will certainly not be associated with it.
So, what should we do to achieve this goal? One method is content-based advertising. The content here means the information that the viewers want to obtain. In the age of the Internet, the viewers devote themselves to giving time to obtain the content, as represented by “smombie” and distracted viewing. If a kind of content called advertising is subject to avoidance, it is for the reason that the content is unwanted. Making the content correspond to customer needs is content-based advertising.
In fact, this idea has existed since quite a long time ago. The Michelin Guide, a guidebook for exclusive restaurants, is published by Michelin, a French tire manufacturer. Why did a tire manufacturer publish a book? It was because tires wear when vehicles are driven to restaurants serving delicious food. To have tires bought and have the customers go to have delicious food is the reason the guidebook was published. This legendary example highlights the importance of achieving the aim, with the information content telling the reader that there is delicious food, so why not go out, instead of calling on the customer to buy tires or drive a car to wear out the tires.
Nowadays, there are opportunities around to provide content to attract customers that are not limited to a large-scale plan such as the publication of a book but as a modest video streaming plan on the Internet and a more modest chat plan. Taking such an opportunity, I consider it a corporate mission of sponsors, who should bring satisfaction to society, to develop content-based advertising as information provided quietly in order to have the public use their products to bring some change to the life of the customers who view the content that replaces conventional advertising, as well as to add color to such new civic life.
* The information contained herein is current as of March 2022.
* The contents of articles on Meiji.net are based on the personal ideas and opinions of the author and do not indicate the official opinion of Meiji University.
* I work to achieve SDGs related to the educational and research themes that I am currently engaged in.
Information noted in the articles and videos, such as positions and affiliations, are current at the time of production.