Box trap? The hidden tricks in the large-screen advertising market that you don’t know about

Box trap? The hidden tricks in the large-screen advertising market that you don’t know about

The rapid rise of the OTT market is mainly due to the market penetration of smart TVs. Data shows that by the end of 2016, the number of OTT TV users was increasing rapidly at an annual rate of 9%. By 2018, the number of OTT TVs in China is expected to surge from 150 million to 280 million. The Chinese OTT large-screen ecological market, with smart TVs as the core, will have a market share of nearly 96% in 2018.

Advertisers rush to land on TV boxes to disrupt the market

Smart TVs give users an opportunity to return to the big screen in the living room, and the "living room economy" centered on family scenes will also usher in a second take-off. Facing this rapidly growing big screen blue ocean, internationally renowned brands such as Procter & Gamble, Unilever, FAW-Volkswagen, Mercedes-Benz, and Dior have begun to take the lead in testing the waters and actively shift their advertising and marketing positions to the smart TV platform.

However, industry experts said that although the market prospects are very promising, advertisers who are new to the OTT market should carefully choose their delivery platforms. One of the more prominent phenomena is that TV boxes occupied a certain proportion of coverage in terminals in the early stage, but in terms of actual advertising effects, there is still a clear gap compared with smart TVs.

In this regard, Li Ye, general manager of the Home Internet Big Data Division of AVIC Cloud Network, believes that the life cycle of OTT boxes is very short. Currently, there are more than 60 million TV boxes on the market, but the activation volume is stable at 20 million units, and the market operation value has been greatly weakened.

What is the difference between a TV box and a smart TV?

At a certain stage of development, the box has well met users' single demand for content during the transition period from traditional TV to smart TV. However, with the popularization of smart TVs, the market competitiveness of the box has gradually declined, especially in the era of large-screen operations that many manufacturers are promoting. The weaknesses of the box have begun to emerge and it cannot be compared with smart TVs.

First of all, there is a big difference in the comprehensiveness of the product functions of the two.

Smart TVs are open, inclusive and resource-rich, providing an immersive audio-visual entertainment experience. They are intelligent, big data, operational and easy to innovate, and provide a richer form of cooperation for large-screen advertising. On the contrary, as a hardware product, although the box has some functional attributes of smart TVs, its low configuration, limited content, single form and poor experience also make it impossible to meet the deep needs of advertisers. For example, the boxes on the market are subject to certain restrictions on storage space, and the performance of chip processors is far behind that of smart TVs.

Secondly, there is also a clear division between the two in terms of user groups.

The survey shows that smart TV users are concentrated in the age group of 25-40, with an overall "three highs" phenomenon of high income, high education and high consumption. They also have very obvious Internet characteristics, great potential for user operational value, and a clear willingness to consume. The box products were originally positioned as auxiliary products that extend the performance of traditional TVs, and their market price was only 100-300 yuan. The notable characteristics of these users are their average economic strength and they do not have very high requirements for quality of life. Therefore, they are not the main target group for advertising.

The commercial value of the box is running out and it is gradually disappearing from the stage of history

The OTT market economy has brought a new round of revolution to home scene marketing. As a unique media terminal that deeply intervenes in the audience's home, large-screen advertising on smart TVs attracts audiences to return to the living room with its strong visual impact and high interactivity, and promotes the smart TV industry chain to extend to content, applications, value-added services and other fields, and also injects new vitality into the development of the OTT advertising industry.

As a transitional product, the commercial value of TV boxes in the living room economy is becoming increasingly narrow as large-screen smart TVs are standardized and their user base is becoming increasingly narrow, and may even gradually approach "zero" in the future. According to a report released by Aowei Cloud Network, the online retail sales of TV boxes in April this year was 293,000 units, a month-on-month decrease of 25.1%, and the sales of the top four brands also dropped sharply by 46.3% year-on-year.

After completing its historical mission, the TV box will probably come to an end in the competition of the living room economy as the "pioneer of China's smart TV".

Together we create a healthy environment to make the big screen blue ocean even bluer

Although there is an obvious difference between boxes and smart TVs, in actual advertising, terminal manufacturers or agents often confuse the two concepts and use the terminal volume of boxes as the terminal volume of smart TVs, which greatly reduces the effectiveness of advertising. Advertisers who cannot obtain real data therefore fall into the box trap with their eyes closed.

The large-screen advertising market is now at a point of vigorous growth. It is inevitable that there will be some problems. Facing opportunities is also a challenge. It requires participants active in this industry to supervise, work together, and jointly maintain an open and transparent market environment to make the blue ocean even bluer, so as to achieve true value sharing.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.

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