Roku is swiftly becoming among the most volatile stocks in the Cheddar 50. Shares of the streaming-device maker were down 26 percent last week, shaken by announcements from Facebook and Comcast that they were offering new streaming products as the pace of cord-cutting in the U.S. intensifies. Still, Roku shares remain up more than 250 percent year-to-date.
It is amid that shakeup that Roku on Monday announced a new partnership with the marketing platform Innovid to provide more in-depth measurements of OTT audiences.
Scott Rosenberg, senior vice president of Roku's platform business, made the announcement on Cheddar. He told Cheddar's Michelle Castillo that the "first-to-market" partnership "is designed to help brands plan, and better migrate their spending into streaming."
Despite streaming video taking up more of a share of "TV time" in U.S. households ー 30 percent of time spent watching video content on television is now happening via an OTT service rather than a traditional cable box ー just 3 percent of brands' advertising budgets is being spent on streaming.
That's because the analytics and measurement technology is still in its infancy compared to the Nielsen ratings that measure traditional TV audiences. Roku is hoping, with the Innovid deal, to help bring more data to brands who may want to increase spending on streaming but aren't sure who and how many people they are reaching, Rosenberg said.
Eventually, streaming ads will be able to merge the "sight, sound, and motion" of traditional TV commercials with digital innovations like interactivity, precise measurability, and targeting, he said.
In its most recent annual report on cord-cutting, Roku predicted that streaming TV viewers could surpass traditional pay TV viewers in five years. And given that most OTT households pay for at least one service, like Netflix or Hulu, the ad-supported streaming model is going to become a bigger part of the TV diet of many viewers, Rosenberg said. He noted that 75 percent of Roku customers already watch at least one ad-supported service on the Roku platform.
"This is a pretty clear indicator that the value proposition of watching something for free in exchange for being exposed to ads is a sound proposition," he said. "Even in this new world."
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