What’s next for Disney+’s advertising level and the clarity of Bob Iger’s ‘Hot Mic’ moment

It’s been a busy year for Disney Advertising and the company’s streaming platforms.

In 2024, Disney saw 40% of its total from the start dollars earmarked for streaming and digital offerings, and it has taken steps throughout the year to strengthen that side of the business, including now working with nearly 40 demand-side platforms, investing in programming multicultural and Branded content focused on DEI (diversity, equity and inclusion)and I’m going through a major period reorganization to bring Disney video advertising inventory to more mid-market advertisers.

“The previous year we came out of a very difficult advertising year, with growth across most, if not all, of our platforms in terms of the number of advertisers we work with and the types of opportunities we let’s create. ” Rita Ferro, Disney’s president of global advertising, told ADWEEK.

Speaking to ADWEEK, Ferro previewed Disney’s upcoming technology and data showcase, explained what’s in store for Disney+’s advertising tier, and spoke to Disney’s CEO. Comments from Bob Iger following a recent “hot mic” moment.

During Disney’s latest earnings call, Iger said that about 60% of all new Disney+ subscribers opt for the ad-supported tier. However, the CEO was later heard questioning whether he was supposed to share these statistics. Ferro now brings some clarity to the situation.

ADWEEK: Rita, looking ahead to 2024, what have been the highlights for Disney Advertising? What were the priorities?

We’ve spent a lot of time driving our automation business and thinking about the right partners to drive the scale and growth of our programmatic business, and obviously developing and continuing to evolve our self-service platform. We’ve spent a lot of time making our data interoperable with the marketplace because more and more marketers want to come in and buy very specific, targeted media around audience segments. So we wanted to make sure that no matter what platform they’re using or how they’re entering, we can leverage that opportunity to plan, buy and measure each of their campaigns in our portfolio. It’s important.

We continue to invest in multicultural programs and engage with marketers, investing in their core consumers, audiences who drive growth, consume their brands, and are fans of their brands.

And then it’s really this middle market segment.

You have undergone a major reorganization to reach mid-market advertisers. Can you talk about the importance of reaching these advertisers, some of whom have never advertised with Disney before?

We want to make sure that when people want to be in the market and think about launching a new product, launching a new service, they’re like, “Oh yeah, and we need to call Disney, because they hear us, they understand . us, and they’re involved in us and everything we build,” and that’s been really important. We have had a significant impact there. It really helped our business.

Earlier this year, Disney had a live moment at the Oscars where Don Julio became the first brand integrated into tracks from the Jimmy Kimmel show. You also had a moment with Johnnie Walker with Ebon Moss-Bachrach at the Emmy Awards. From now on, it’s Conan O’Brien who hosts the Oscars. Can you talk about the opportunity that exists there, and will we see more live integrations in the future?

We’ve been doing this for years with the Oscars. The Academy of Motion Picture Arts and Sciences is a great partner for us in looking at ways to offer services to brand partners and presenting partners who come in and want to be part of the storytelling. A lot is done on the red carpet, sometimes behind the scenes in the green room. So we’re looking to personalize what a brand is looking to experience or create for the fan, for the viewer, or even onsite for the nominees to really tailor it to the outcomes they want. But it remains a huge opportunity for us.

During a recent earnings call, Disney CEO Bob Iger said that about 60% of all new Disney+ subscribers opt for the ad-supported tier. According to Iger, approximately 37% of all subscribers in the United States are AVOD (ad-based video on demand) subscriptions, and 30% worldwide. After he said this information, there was a “hot mic” situation where Iger was heard wondering if he should have revealed the statistics. So, should he have?

You’ll soon see some numbers regarding exactly what those subscribers are. What we’re doing is looking at it from the perspective of a complete portfolio rather than individual platforms. Because with Hulu on Disney+ and ESPN coming to Disney+, you want to make sure you have the correct number in place to avoid any duplication of numbers. For us, it’s about making sure we have the right number to publish. What I heard from what he said is that at the end of the day, if you look at everyone – because Hulu has been reporting numbers for years – we’re about 60 or 65 percent level funded by advertising. We’re getting there with Disney+. There is room for growth. It’s exciting for us, but we want to make sure – because Hulu is on Disney+ and ESPN is coming – that we have a number that speaks to our entire advertising portfolio.

OK, so it was about making sure that the ad tier number is the final number that you want to publish?

Yeah, and I think you’re going to see it, because Nielsen, I think, is coming out with its kind of MAU (monthly active user) number.

What lies ahead for the Disney+ advertising level in 2025 and for Disney adtech?

We know that over 50% of people who sign up for Disney+ choose the ad tier. The number fluctuates, but it’s certainly above 50% consistently from month to month.

We are very excited about our technology and data showcase, where we will talk about the next steps in the coming year. Last year we announced Disney’s magic words. We now have a few brands who have come to test with us. We learned some things about the next steps in contextual advertising and getting the right ad in front of the right consumer at the right time, and what that generates in terms of opportunities for brands.

We are very excited about our global rollout and ensuring our customers understand the benefits of our global technology stack so that every time we launch new advertising products and innovations in the United States, our global markets can benefit. And as more and more brands seek global opportunities, Disney is going to be an important partner for them in this space, given how much of our content resonates globally with our key franchises around Marvel, Star Wars and Disney, and some of them. our best shows, which resonate around the world.

What else can marketers expect from the Tech and Data Showcase?

We will also talk about The next version of Generation Stream. We published these studies on thought leadership. Hulu made the first one, Gen Stream, before merging with them. But then we did Gen Stream Sports. We did Gen Stream Family. This was the third version, and we will publish the results to the Gen Stream global ad markets. So I think we’re very excited about the global consumer, who they are, how it’s different and how it’s the same on our platforms around the world so that brands fully understand how to partner with the better with Disney on our streaming activities. .

And then the last thing I think we’ll talk about a little bit is teasing advertising innovation and ESPN’s next flagship and opportunity, what that will mean for partners in terms of sports and streaming.

You have ESPN’s flagship streamer coming out. But you also have the ESPN vignette coming to Disney+, much like the Hulu vignette has already arrived at Disney+. What is the difference between tile and flagship streamer?

The tile will contain much of the content from ESPN that we believe audiences who use the Disney+ platform will enjoy and consume, and it may be different from some content you would traditionally see on ESPN+. We know that the Disney+ consumer is a different consumer, and they’re probably not a huge sports fan. Some may be, but we want to offer more content samples, focusing on live events and alternative broadcasts. For example, we’re going to have an alternate cast of Mickey and Minnie for the National Basketball Association’s Christmas Day games. So there are a lot of things like that. More women’s sports because we know there are more women watching on Disney+. And by the way, why not give them amazing stories and sports that inspire them and keep them watching more content? So this is an audience expansion opportunity.

This brings more relevant sports to the consumer on that platform because of the information we have about who the consumer is on that platform. This allows us to bring that to the platform in a way that will be interesting, unique, and ultimately potentially create new, unique, bespoke content for the ESPN vignette on Disney+. It’s complementary to what you’re going to see on the flagship, and it will be video experiences, not a full, immersive platform that ESPN’s flagship will ultimately become.

This interview has been edited for length and clarity.