By Ken Kelley
TORONTO – As much of a roller coaster ride that 2020 has proven to be thus far, Corus CEO Doug Murphy is confident the company will remain on solid footing, whatever the future brings.
Speaking with Canaccord Genuity’s Aravinda Galappatthige as a part of that company’s 40th Annual Growth Conference, Murphy said Corus is now seeing month-to-month improvement in television ad revenues during what has been a tumultuous year, to say the least.
Starting with a plethora of cancelled ad campaigns in March, through Covid-related messaging that dominated the airwaves in the first half of spring, Murphy said it was later in April and May when the company started to see some stabilization in ad revenues. Canaccord Genuity, however, estimates that the TV ad business isn’t likely to see a return to year-over-year growth until Q3 2021.
“We are now in a phase of sequential improvement,” Murphy said. “Overall, it’s like a tale of two cities, where you have certain categories like food, grocery, telecom, pharma and direct-to-consumer, among others that are growing year over year, while you have other areas like travel, shopping centres and cinema that aren’t quite as well off.
“We’re continuing to work on a category-by-category basis, but what we’ve found is true is from a brand equity point-of-view, advertisers are realizing they need to be on television, given the reach and frequency, to keep their brand front and centre because if they’re not, someone else is going to be.”
“The StackTV audience is primarily younger and, of all the hours streamed, more than 50% is the live television feed as opposed to on demand binging.” – Doug Murphy, Corus Entertainment
Murphy noted while Corus properties benefitted from an uptake in viewership in the early days of the pandemic, namely due to the lack of televised sporting events, the return of sports, specifically hockey, over the last month has meant viewership numbers have seen a slight decrease.
“Since hockey has come back, we’ve seen a bit of a shift back (to pre-pandemic figures in terms of viewership), but we are still net up in terms of share gains. It will depend on how many Canadian teams get deep in the playoffs.”
Turning to Corus’ growing StackTV product, Murphy said one of the biggest revelations that the company’s data has shown them is how their viewers have eschewed the trends that have dominated other streaming platforms, such as Netflix.
“In a world where everybody thinks about binge viewing and how Netflix has kind of changed the behaviour of viewers, the StackTV audience is primarily younger and, of all the hours streamed, more than 50% is the live television feed as opposed to on demand binging. I think that’s quite telling about the resiliency of television for the long term,” Murphy said.
According to Canaccord Genuity in a note to investors after its event, Amazon Prime has significantly lower penetration in Canada compared to the U.S. (40% vs 60%), which Galappatthige believes indicates the potential for further growth for StackTV over time. Canaccord projects StackTV could surpass the 300,000 sub mark this fall. While Murphy wouldn’t divulge numbers, he hinted the company is well on its way to the next significant milestone in terms of subscriber count.
“We’re going to be in a position to speak in more detail to that in our next quarter earnings release, but the gross adds has been remarkable,” he said.
