How does Google’s ad tech fit into the connected TV streaming ecosystem, in general, then?
We are a supplier of a series of tools, both for the buying side and the sell-side of the advertising business. And today through DV360 [Google’s demand-side platform]—not just YouTube—but you can buy nine out of the top 10 ad-supported streaming services in the U.S.
On the publisher side, we provide a suite of tools to publishers of all sizes. I mean, Disney uses our publisher tools to serve ads on a number of their platforms; lots of very large publishers do that.
Google is a giant company, with broad insights into the global economy, what is your outlook for advertising?
It’s very nuanced because different industries are experiencing very different dynamics. The travel industry is booming after the depths of the COVID depression; the automotive industry is having a hard time because they can’t get parts. That obviously has a negative impact on their advertising.
I was talking to one of the biggest beer and soft-drink players yesterday, they can’t get aluminum for their cans or glass for their bottles. They’re actually physically constrained in packaging. I expect the advertising industry will pivot more to performance and very results-based advertising. That typically is what happens if the economy gets a little tighter.
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We have seen some major brands talk about belt-tightening on linear TV, does that mean your message to marketers to ditch TV is finally getting through?
When people ask me what was the major media trend during COVID, and what will be the major media trend of the next couple of years, I say, "video." The pace of consumption on digital platforms is incredible, you’ve seen so much innovation in formats. If you look at the efficiency and return on investment by format, in fact, the traditional TV spot, the 30-second format, is almost the bottom of the trough, the worst return on ad spend.
But just because linear TV is dying, the TV screen is very much alive.
Could you say how YouTube is doing in its upfront?
I think we’re going to do very well, but look every broadcaster is also talking first about their streaming platform. So if you’re Disney, you talk about Disney+ and Hulu, and if you’re NBCUniversal, you talk about Peacock, and so everybody is leaning into their CTV assets. And we’re wrapping it up right now, so I really can’t share.
What are the signs to look for in a successful upfront sales season?
The things to look at are what happened to their CPMs [cost to reach 1,000 viewers], so their price, and then what happened to their total committed dollars. I think those are two variables, right, the CPM will tell you what kind of price increase that platform can command, and the total dollars will say what’s their share of wallet, or voice if you will, in the upfront. Those would be two numbers that I want to look at over time.