Australian ad spend smashed records in 2021 with new all time highs set monthly and for the calendar year.  Digital ad spend also – again – surpassed traditional television and blew multiyear forecasts out of the water.

That’s also true at Foxtel Media. In the last twelve months, we have notched 75 per cent digital revenue growth, and a 32 per cent increase in the number of advertisers on digital platforms. Foxtel Media’s digital assets now reach a combined average monthly audience of over 10 million people.

The trend towards digital has been a consumer-led journey. More viewers are turning to OTT options through CTV than ever before. These are a few factors we see at the forefront of digital advertising, and how we’re innovating in response:

1. Put it to the test

The industry is missing many digital opportunities they have just not yet spotted. The current model won’t stay as it is forever – and it’s critical to proactively test and innovate.

Which is why we’ve launched FOXTEST – to help co-create the future of marketing across specific areas of video advertising. It’s a $3 million initiative to help brands explore the frontiers of advertising, and run experiments across advertising content, experience, and data. Agency partners or brands will be able to innovate across key areas such as:

• Content: the impact of context, assessing inventory on engagement, re-evaluating standard media metrics.
• Ad experience: the impact of lower ad loads on advertising performance, the co-creation of new ad formats, and tactics to enhance to command more attention.
• Data: connecting third party with our verified first party subscriber data, deeper consumer insight, sales attribution.

Our early experiments strongly suggest that lower ad loads results in greater cut through. Advertisers who have had simultaneous campaigns on FTA have reported a stronger impact, high engagement and higher recall on Foxtel than on FTA.

2. Budget restructure

Two years ago, Foxtel Media shifted its trading model across all demos and all dayparts. Fixed pricing was dialled back because the industry wanted a more contemporary way to buy TV, with guaranteed outcomes. Pre-Covid, Foxtel Media traded 35 per cent of inventory dynamically. Today, it’s 70 per cent. Because of this shift, 97 per cent of our campaigns were delivered on time, on target and, critically, on budget, throughout 2021.

However, with the ongoing challenges of linear delivery, another shift is on the horizon.  We’re eager to work with brands and agencies to bring our models in line with modern consumption patterns.

For example, last year Foxtel Media teamed up with Hearts and Science on a Hyundai Palisade campaign that traded and assessed performance as a single video buy, as opposed to separate line items across linear and digital. By building a live platform for the agency to buy against that unified ads on the Foxtel platform and on Kayo, we were able to deliver additional reach without incurring extra cost.

We achieved an 11 per cent increase in audience, and a 20 per cent uplift in incremental audience for the key demographic of people aged 24- 54, and we did this while maintaining the CPM rate across digital and linear platforms. In short, bigger bang, same buck, no siloes.

3. Flexibility is paramount

Content consumption patterns are changeable and flexible. A viewer that pre-pandemic only watched sports may now be business owner who’s glued to finance news.

Advertising needs to be as flexible as viewers’ consumption patterns. In the first half of 2021, Foxtel’s on-demand platforms had a monthly reach of 4.6 million users. More than half of them did not watch FTA BVOD – so that’s 2.6 million users who are exclusive to Foxtel.

Kayo has opened up Foxtel Group’s sports portfolio to a whole new multitude of Australians. Since the start of 2021, we’ve seen accelerated subscriber growth of 56 per cent. The subscriber count is now at 1.1 million, which equates to 3 million monthly UAs. On a weekly basis, 80 per cent of our subscribers are active, and watch on average five live events.

Foxtel’s intelligent video network was strengthened by the recent addition of LG Ads, which brings Foxtel Media campaigns to LG Smart TVs across the country. This opens new, native ad formats across LG’s ecosystem, including Home Launcher, wedge and hero ad units, and content store tiles. The Entertainment category has jumped on these formats in particular.

Foxtel Media’s world of intelligent video gives advertisers greater knowledge than ever before about the audience you’re buying. Our viewers are subscribers, who tend to watch more to get bang for buck, and engage more, because they choose to pay for access to our content.

Which might be why other subscription video content providers are starting to copy our model. But that’s not surprising. We have lower ad loads, premium formats and bold integrations, which mean ads are more likely to be noticed. Perhaps most importantly, we are not a network that simply aims to maintain our current audience, but one that is constantly innovating to launch new platforms that engage diverse audiences.

We are glad that digital continues to outstrip the market – because that is growth for TV, and growth for advertisers that can grasp the opportunity.