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23 July 2020

Peacock stumbles in debut week, prompting more adventurous ad formats 

Last week’s episode of The Faultline Podcast prematurely hailed Peacock’s launch a smooth ride compared to the train wreck debuts of HBO Max, Quibi and even Disney+. One week on, users have reported navigation struggles, HDMI woes and – of particular concern – a platform already showing signs of a content crisis.

But above all, Peacock’s prolonged absence from Roku and Amazon streaming devices is NBCUniversal’s most pressing concern. Peacock is missing out on 70 million potential pairs of eyeballs in the US, and growing. We understand this isn’t any fault of NBCU directly, with the two streaming stick heavyweights reportedly demanding egregious terms for distribution deals, as discussions reached stalemate in a similar state of affairs experienced by HBO Max.

So, while Amazon and Roku drag their feet, users have taken alternative measures to getting Peacock on the big screen – triggering a flood of complaints as Peacock decided to tighten security by blocking external HDMI signals from streaming devices to monitors, much to the frustration of paying subscribers. This is despite compatibility with Android TV and Chromecast, as well as Apple TV, iOS, Vizio SmartCast TVs, LG Smart TVs, Xbox One and PlayStation 4 consoles.

There was also early confusion among Android users as Peacock was nowhere to be seen in the Google Play store in the early hours of the platform’s US debut, but this was resolved pretty sharpish.

Peacock’s navigation has also come under scrutiny in its debut week, with users complaining about the “continue watching” panel vanishing, as well as confusion around genre categorization and difficulty finding content from specific studios – something that Disney+ and HBO Max have both emphasized.

On the content side of the coin, Peacock’s appeal has been severely hampered by the postponement of the Tokyo Olympics on which its launch was heavily dependent on. But despite months to find gripping alternatives, it hasn’t been easy. An important last gasp distribution deal was struck with ViacomCBS a few weeks prior to launch, as well as rights to show UK Premier League soccer matches, but we still feel these came as too little, too late for Peacock. The service has also suffered from an early spate of licensing deal drama, with certain big budget movies reportedly disappearing from Peacock just one day after launch. Hardly a strategy to keep users hooked.

We are yet to come across any ad-related complaints, such as repetitive or irrelevant ads being shown, which is a promising sign considering Peacock was described pre-launch as providing the opposite to “ad nausea” which is prevalent in pay TV offerings. Peacock has pledged a maximum of 5 minutes of advertising for every hour of content, and those 5 minutes or less will comprise highly targeted and personalized ads. Here, NBCU has added Sky AdSmart inventory to its One Platform to bring advertising from multiple sources and delivery mechanisms under one umbrella.

Beyond targeting and personalization, NBCU has promised to get experimental with ads and this is where things get interesting. Just this week, the Comcast-owned company revealed that 11 new advertising formats are being created for marketers – taking its total to 30 different ways of delivering ads.

One teaser format coined “1:1 Talent Surprise” will show live video chats between two brand representatives or celebrities during ad breaks. “Set on Set” and “Brand Experience” are two new features where brands can promote ads directly on the sets of shows, developed in collaboration with NBCU writers and producers, which sounds like it could be intrusive to the content and defeats the point of having dedicated ad slots.

These experimental formats build on Peacock’s Prime Pods, which are 60-second ad slots running during the opening or closing ad breaks, designed to minimize in-show interruptions. Elsewhere, QR codes are being shown as “shoppable ads”, a feature already commonplace in poster ads, while another feature brings up a full-screen ad when a show is paused. Mood and genre-based ads are also being explored.

NBCU has also been exploring binge ads, where binge viewers are rewarded with fewer ads than casual viewers, so brands can sponsor an ad-free episode. Hulu has done something pretty similar.

On the plus side, Peacock launched with over 13,000 hours of content on the free tier, almost double what NBCU initially said would be available on an ad-supported basis. The partially ad-supported tier costs $4.99 a month, while no ads costs $9.99 a month.

For a company that is unlikely to break even until 2024, relying on an ARPU in the region of $6 to $7, these early complaints may signal more serious underlying problems for Peacock than simple teething issues. Comcast’s next set of financial results will be telling, with previous reports showing start-up costs associated with Peacock ballooning.