Streaming: People are looking to ‘entertain themselves,’ Loop Media CEO says
RACHELLE AKUFFO: It's something we're hearing from social media companies, tech giants, and traditional media outlets. Ad spending is slowing. But companies like Loop Media are finding ways to adapt to this changing environment.
Loop Media CEO and co-founder Jon Niermann joins us now, alongside our very own Alexandra Canal. Warner Brothers Discovery, I want to first start there because we saw David Zaslav really painting a grim picture of the ad market while speaking at RBC's media conference earlier today. I want to get your take on where you think ad spend is heading. And do you have as grim of an outlook?
JON NIERMANN: I do. Well, thanks for having me on and bringing that up. I actually don't have that grim of an outlook. I think it varies depending on where the spend is, clearly. So if you're talking about a pure social media spend or something that they've been spending on for quite some time, it's a little depressed now.
We focus on digital out-of-home and CTV, the connected TV space. And those areas are actually doing OK. So, as you know, advertising has a lot of different segments. So I think it's too general just to say it's in the tank and it's horrible. It really just kind of depends where you're looking.
ALEXANDRA CANAL: And Jon, I want to pick up on that point because for those that don't know, you guys offer free ad-supported services to various types of businesses, like nail salons, restaurants, hotels, et cetera. So your business model heavily rooted in advertising. What are you hearing from partners when it comes to cautious optimism? Are they, like, pulling back a little bit? What's that conversation like?
JON NIERMANN: I think for ours, they're excited to hear that this is available. So if you kind of look at the traditional advertising, where they put everything on linear TV or outdoor and billboards and print and all that stuff, it's clearly shifted to digital. I think this past year, it's 55% digital, so most people are using that.
So they're hearing when they say that, oh, you have this opportunity to get this captive audience for out of the home, they're excited about it. So really, it's about discovery, and it's about them understanding that a network like Loop exists. And as you say, I mean, you kind of think about what a consumer streaming company like Roku does for consumers, or Pluto, or anything like that, Loop does that for businesses. It's just a different type of content.
ALEXANDRA CANAL: And businesses, too. Two years ago, when you guys came around, the pandemic was rampant. And you guys really provided a lifeline for a lot of these companies. Now with all this macroeconomic uncertainty, what trends are you seeing with some of your clients? Are they-- is it similar to what it was in the pandemic? Is everyone just kind of very cautious?
JON NIERMANN: People are coming out of it. There was a tough time clearly for businesses. They were unfortunately going under and suffering. And when you're a business, you have so much to worry about-- staffing inventory cost, everything else, keeping the lights on. So a lot of the times, what you have on the screens isn't that important. So now that they're a little further away from the pandemic, they want to do more engagement, and that's where we come in.
So everybody's really excited now that the crowds are coming back. People are still-- even in tough economic times, they look for ways to entertain themselves. They want to get out. And you can kind of historically look at that. So they're going out more. And that type of engagement is really important. So people are optimistic, I think, in our field.
RACHELLE AKUFFO: And Jon, in terms of how you innovated with digital out of the home products and services there, where do you see the growth coming from?
JON NIERMANN: Well, we really think it's a green field. I mean, if you kind of look at the tens of millions of businesses that are out there, you know, tens of thousands are streaming right now. So just kind of think about that. So there's a tremendous upside. Think about where the homes were 10 years ago. We always like to say that. You had cable and satellite. That was kind of your only option.
Suddenly you started hearing about these streaming services. Well, now that's where businesses are. You're finally getting an opportunity to find a streaming service that works for you. You're not going to go to a bar. You're not going to go to a nail salon. You're not going to go to a restaurant and watch a movie. So you have to have something kind of short and upbeat like music videos, perfect type of content, fail videos, et cetera. So that's how we're really pushing forward tremendous green field, blue ocean-- pick your analogy.
ALEXANDRA CANAL: And there has been so much focus on direct to consumer right now. So in what ways is this space untapped? And where would you like to see the industry head? I know you guys recently uplisted shares to the NYSE as well.
JON NIERMANN: We did. We were excited about that. September 22, we finally went up New York Stock Exchange. And you had a great point. Everybody was looking at direct to consumer because that's where the huge sexy audience is, as you want these consumers. They kind of ignored these millions of screens out of home. We're putting together as a network.
Think about building, connecting all these screens as a network, and you have content that works for them, great place to advertise, send message out. And digital signage is all included as well so you can really customize. We have Loop venues right next to each other. You would not know that they're the same service because you could create whatever content from our programming that you want to show at whatever time to really customize your offering.
RACHELLE AKUFFO: Fascinating stuff, custom content. Jon Niermann and Alexandra Canal, thank you both.