Everybody wants a piece of the direct-to-consumer advertising pie—but some streaming TV players might be better positioned to get it, according to Peter Naylor, senior VP and head of advertising sales at Hulu. The Los Angeles-based subscription service has seen the d-to-c segment of its business increase 85 percent year-over-year, Naylor said Tuesday, speaking at Ad Age’s OTT-focused Next conference.
“These direct-to-consumer, digitally-native brands are extraordinarily sophisticated,” said Naylor. “They’re not pray and spray, they are marketing-led.” Many of such brands, which include a bevy of trendy names such as Casper, Burrow, Quip and Away, started advertising on social media because it's an inexpensive entry point. Now, these players are beginning to look at video as the next viable option as their storytelling becomes more advanced and their business grows in both awareness and sales.
Networks are taking notice. In recent months, broadcasters including A&E Networks, Viacom and NBC Universal have all touted their own tools and programs designed with the d-to-c player in mind. Late last year, NBC announced it was working with agency Giant Spoon on an initiative meant to make advertising on TV easier for d-to-c brands. A&E recently debuted a new ad tool that provides measurement reports similar to what an advertiser would receive from Facebook or Google.
But traditional broadcasters have stiff competition. Two years ago, Hulu set up its own vertical team to attract d-to-c brands. Because services like Hulu are able to offer “tightly targeted and highly measurable” ads, they are more appealing options for retailers, Naylor noted.