Feature - Q4 Marketing Campaigns

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Toy companies are once again ramping up their marketing efforts as we head into the Golden Quarter, aiming to get their products in front of kids, wherever they may be. In this piece, a selection of industry experts - Havas Entertainment’s Tristan Brooks, KidsKnowBest’s Rob Lough and Generation Media’s Jon Chambers - take Toy World readers behind the scenes (and screens) to break down the entertainment and content landscape and help companies understand where best to place their spend.

Our expert contributors all agree – fragmentation continues to alter the lay of the marketing land. Kids have undeniably moved away from scheduled TV programming towards platforms that provide video content on demand, whenever and wherever they want it.

Jon Chambers

According to Jon Chambers, director of Investment at Generation Media, SVOD services account for the largest share of content viewing (33%) among 2–9-year-olds in the UK (Giraffe Insights, Kids and the Screen).

A report from regulator Ofcom released in August revealed that one in five UK homes had access to all three of the current biggest SVOD services - Netflix, Disney+ and Amazon Prime (ordered according to market share) – while data from Justwatch shows that the combined trio holds 77% of the streaming market. Justwatch also says Disney+ has seen the most growth so far this year, increasing +3% since January, while Netflix and Amazon Prime Video each earned +2% in the same period.

“Whilst SVODs remain non-commercial for now, they should not be discounted from immediate marketing plans as they act as a fantastic distribution platform for content if you are able to negotiate placement,” Jon says. “Expect them to feature prominently in marketing considerations in 2023, however, as commercial opportunities are made available.”

Both Disney+ and Netflix have announced plans to launch reducedprice subscription offerings, with the shortfall offset by advertising. Netflix has already announced that it will be launching its reduced subscription offering this November in the US, beating the Disney+ launch by one month. Tristan Brooks, managing partner, Havas Entertainment Toy Team, says: “We’re still to understand the advertising opportunities, but the potential is there: these platforms offer access to established and engaged audiences, potentially at scale if the take up is strong.”

Tristan Brooks

Rob Lough, chief brand officer/co-founder, KidsKnowBest, urges caution though. He says that while this model will become more widespread,offering media buyers an opportunity for hyper-targeted distribution, KidsKnowBest’s recent Netfiles report revealed that just under a quarter of Netflix (23%) and Disney+ (22%) subscribers in the US said they’d consider leaving these platforms if ads were introduced. The question, one must wonder in the current economy, is how many new subscribers the reduced-price model would attract?

Rob Lough

Jon Chambers muses: “If, as hypothesised, the model attracts new users to the platforms, then expect others to follow suit very quickly. However, if Netflix and Disney+ see a mass migration of users from the full fee service into the reduced fee, ad funded model, then expect there to be a delay in other platforms enacting similar policies.”

“Video content remains the dominant form of entertainment, be that on streaming services, YouTube, or traditional broadcast,” Jon adds. “However, the greatest shift we’re experiencing in this space is the consistent movement towards the TV set as the primary device for consuming video content. Over 80% of Disney+ and Netflix viewing takes place on the TV set (2-9 year olds), and we are now able to deliver entire YouTube campaigns via the TV set only, bringing the commercial power of the big screen to the most popular commercial platform for kids. That said, Video’s dominance has been heavily challenged into 2022 and will continue to come under pressure from Gaming into 2023 and beyond - especially amongst older children.”

Rob Lough says in-game advertising has been growing for years and will only continue to grow further, with ad networks such as Bidstack and Bloxbiz leading the way. Giraffe Insights’ Little Voices research shows kids aged 7-11 are spending on average more than one hour per weekday playing games and apps, which Jon Chambers says means commercial opportunities are becoming more affordable and more effective for brands. Spin Master has been quick on the uptake in this area, launching the latest series of Bakugan within Roblox and ensuring a global audience with a greater reach than any single TV broadcaster.

Affordability appears key to leveraging the opportunities presented by the likes of Minecraft and Roblox, which Tristan Brooks feels are leading social gaming environments with highly engaged communities (a bit like mini Metaverses). He says: “The high cost of entry for advertisers on these platforms has always been a challenge. To build and create meaningful interactions is expensive and has meant only the brands with larger budgets have access. Ultimately, it’s down to the platform owners and how commercially accessible they wish to make their platforms for advertisers - or even if they need to. There’s great potential here and as social gaming is always evolving, we may well see growing opportunities for advertisers.”

“In-game video advertising on casual gaming apps, such as Angry Birds, should see growth in investment in the coming year as advertisers shift video budgets away from kids TV in an effort to drive reach and awareness elsewhere,” continues Tristan. “In my opinion, YouTube investment should be prioritised over in-game advertising as it currently offers better reach, targeting, pricing and optimisation.”

Jon Chambers explains that beyond SVOD, Linear TV accounts for 24% of viewing time whilst Free Online Video - predominantly YouTube - accounts for 21%. However, he says this doesn’t paint the full picture for marketers. Only 43% of the video viewing that takes place in the UK is of commercial channels, and of this, 76% are children’s specific. Drilling down to the kids’ commercial video landscape even further, Jon says YouTube accounts for 51% of viewing compared to Linear TV’s 21%. “It is therefore no surprise to see YouTube, in many cases, competing with and even replacing Linear TV as the major component of brand marketing campaigns,” he tells us.

KidsKnowBest’s research indicates that 67% of kids in the UK and 71% in the US say YouTube is their favourite platform. It’s understandable, therefore, that Havas Entertainment’s Tristan Brooks feels YouTube is underinvested in as things currently stand: he says it offers plenty of potential for driving cost effective reach and consideration against targeted child and parent audiences. However, Social Media is where he sees bigger opportunities in the run up to Christmas, especially across Facebook and Instagram. With more advertisers vying for attention around the end of the year, Tristan says it’s crucial to ‘get standout from the formats, messaging and creative you run’. “Advertisers need to focus on the customer journey, test what messages will resonate and when in order to ‘nudge’ customers down the consideration to conversion path,” he explains.

According to KidsKnowBest, children start shifting to TikTok at age 10, and by the time they’re 15, it’s their No. 1 choice. Jon Chambers at Generation Media agrees that TikTok continues to make headlines and grow its user base amongst youth audiences. Among younger kids, however, at the ages we usually see heading to toy shops, viewing time is surprisingly low when you consider the publicity the platform attracts. Social Media accounts for just 2% of total content time for 2–9-year-olds in the UK, explains Jon, of which TikTok commands a 66% share. This, coupled with TikTok’s policy of not carrying ads targeted directly at children, means the platform should remain a secondary media consideration compared to the more established video and gaming partners. Jon adds: “Agencies and brands will need to continue to carefully consider the best ways to engage with their audience on the platform (e.g. effective use of influencers), to extract maximum commercial value.”

It’s worth noting the impact the cost of living crisis will have on content consumption (and therefore ad consumption) this year. For the same reason reducedprice-with-ads SVOD platforms may prove popular among families watching the pennies, Tristan believes cinemas are in for a tough year, with trips to watch movies on the big screen declining unless an absolute ‘must see’ film is being shown. Instead, families will continue to watch movies at home on the subscription services they pay for. As a result, Sky Family Movies, Netflix, Amazon Prime and Freevee will become increasingly important distribution platforms for film companies and audiences may see more straight-tostreaming film launches in the coming year.

Ultimately, where to place spend depends on myriad factors and of course, what works for one company may not work for another, as Jon explains.

“Determining the best ROI will be entirely specific to each brand’s unique challenges and objectives,” he says. “YouTube currently offers advertisers the most cost-efficient platform on which to generate mass awareness. If driving parents to eCommerce platforms is the priority, then PPC (pay-per-click), Facebook and TikTok are the current market leaders for entertainment brands. But for arguably the greatest overall effect, including increasing the efficiency of performance channels such as Facebook and PPC, then TV still provides the best pound-forpound ROI. When considering how to maximise ROI for your brand, it’s essential that no channel is considered in isolation. A balanced, insight and data driven multi-channel approach will deliver the greatest potential ROI.”

Looking ahead, Jon is expecting to see consolidation as linear TV continues to decline. He says he wouldn’t be surprised if Cartoon Network ended up being sold by Sky Media in 2023, following the WarnerMedia and Discovery merger and the announcement that they will be investing more in combining their streaming platforms. And in the longer term, he expects at least one major kids’ network to retreat from the linear space altogether in favour of digital platforms, just like Disney has with its Channel, Junior and XD channels.

Rob says media agencies are going to have to work even harder in the years ahead as the world becomes more programmatic and measurement becomes easier to gauge at the individual level. It’s his opinion that many companies will start to bring their media in-house: those agencies that remain relevant will do so by having a USP built on data, insights and deep strategy that moves the needle - not networks and connections.

Tristan, meanwhile, believes that consumer data privacy concerns will continue to be a hot topic among consumers. He says it’s already challenging advertisers’ ability to collect data for targeting and remarketing to adult audiences across the big tech platforms. He adds: “Working with agencies and media partners that have the ability to build out quality audiences in a ‘post cookie’ market will be key, especially as I think targeting purchasers will become increasingly important for advertisers, as child audiences become increasingly fragmented and harder to reach.”

He also has advice for the here and now: “Advertisers need to evolve and test new media and creative opportunities to really learn how these can enhance sales performance. This Q4 is already looking like it will be challenging at retail, with consumer confidence currently quite low. This may mean you need to change your approach and plans at short notice and pivot investment. Lean into your agency partners to support you with any data and insights that add real value to understanding campaign performance, not just reporting media benchmarks. Regular communication, quality data and insight and the ability to react fast will be key to maximising your campaign performance.”

Over the coming pages, Toy World finds out how toy and game companies are reaching kids this year, wherever they may be.