Connected TV (CTV)’s ‘New’ Business Opportunities — Living Room To Revenue!
Connected TV (CTV) — A television viewing environment where video content is consumed over a streaming (OTT) connection rather than traditional broadcast. CTV content can be delivered either directly through a smart TV’s internet connection or through a device like Roku, Apple TV, or Amazon Fire.
By merging the scale and legacy of TV with the cutting-edge promises of digital, connected TV is one of the most exciting mediums for marketers.
Connected TV (CTV)’s ‘New’ Opportunities — 46 Key Interesting Stats And Facts For Digital Marketers, Advertisers, and Businesses!
Connected TV (CTV) represents an enormous market (expected to reach $24.4bn) that opens up a gateway to experimentation for marketers and advertisers since content is streamed through a variety of devices, Smart TVs, and game consoles.
Percentage of U.S. connected TV viewers who watch ad-supported CTV content (MAGNITE, OCTOBER 2021) — 90%
CTV has traditional TV’s professionally produced content, with the added benefit of a limited commercial model and improved targeting since the ads are digitally served.
The opportunity for immersive ad formats that include commerce, animation, games, and videos will bring interactivity and a personalized approach into the user experience.
Eighty percent of consumers reported that their media consumption habits increased during the pandemic.
In February 2020, streaming accounted for only a fifth 4 of the viewing on U.S. televisions. But, as COVID took root in American communities, research firm Moffett Nathanson estimated that streaming viewership rose by 75%. And, simultaneously, pay TV subscription cancellations began to plummet.
In fact, while 70% of Gen Z says they watch video content on their smartphones, 77% say they watch connected TV.
Infillion’s ongoing research on COVID-era consumer sentiment found that, alongside gyms and airports, movie theatres were consistently among the businesses that Americans were least likely to want to patronize any time soon.
Indeed, market research firm Parks Associates found in December 2020 that 40% of consumers had opted into a free trial for at least one streaming service since COVID quarantines and lockdowns began.
The average American household now owns seven internet-enabled devices that can stream video content, from tablets to smartphones to streaming-ready TVs.
“CTV, or connected TV, is that portion of the OTT universe that is actually watched on a television set, versus a laptop, mobile phone or tablet. In other words, most of it.” — TV[R]EV
With nearly 60% of television viewing 5 in U.S. households with a broadband connection now viewed on-demand, notions of “primetime” have been upended. A lot’s changed, yet consumers have not abandoned the living room TV.
But against all odds, consumers have not abandoned the living room TV. Even when they have video enabled devices in their pockets, consumers want to watch high-quality content on the highest-quality screen available to them. Enter connected TV.
For years, Netflix and Hulu have reported that upwards of 70 percent of their viewing happens in the living room. The TV[R]EV report estimates that overall it’s more like 80 to 90 percent.
Percentage of digital video ad views that take place on TVs (FREEWHEEL, MARCH 2022) — 77%.
Estimated size of the U.S. connected TV ad market by 2024 (EMARKETER, NOVEMBER 2021) — $29.5 Billion.
Streaming has normalized new phenomena like binge-watching, time shifting, viewership fragmented across an exploding landscape of available content and services, and (to the chagrin of marketers) ad-free viewing options. And this is key for advertisers to understand and address.
Unlike linear TV, CTV advertising allows you to track who sees your ads and engages with your brand afterward. Real-time metrics and internet capable CTV tracking allows for adjustments and optimization, when necessary, which can efficiently increase the effectiveness of your ad CTV campaign.
Because CTV ads are less likely to be skippable, they tend to yield a higher video completion rate (VCR) than other types of video advertising. High VCRs mean more attention and eyes on your brand.
Advertising opportunities vary from one household to the next based on who’s “cut the cord” versus who still watches plenty of linear TV alongside CTV, who pays extra for fewer or no ads, and more.
Varying platform capabilities, targeting abilities, and owner/subscriber demographic profiles across different CTV services mean this is the reality for the foreseeable future.
CTV is typically more costly than linear but the value is worth it given the greater targeting. Marketers need to be OK with higher costs for more specific audiences, as opposed to cheap reach.
According to Nielsen, connected TV viewing was up 81% year-over-year shortly after COVID hit and stayed high, while traditional TV viewing eventually returned to pre COVID projections.
According to eMarketer, the share of ad agencies that buy traditional and digital video together went from 40% in 2017 to 61% in 2019.
CTV can add incremental reach and frequency, empowering marketers to regain the reach for their message that has been lost in the shift from traditional TV to streaming.
CTV as a medium gives advertisers the best of both digital and TV advertising. Thinking creatively and leaning into those possibilities can turn CTV into your next media powerhouse.
According to Nielsen, fewer than half of consumers cite ad-free content as a top priority when they shop for streaming services. Hulu reported that 70% of its subscribers sign up for the less expensive service with ads, than the slightly more expensive service without.
The modern living room remains one of the biggest opportunities for brands right now. A great strategy requires understanding the hardware and software interfaces to taking full advantage of both the immersive environment of connected TV and the functionality that can take it well beyond desktop and mobile environments.
CTV’s creative potential is vast, but marketers must take into consideration that not all devices have the same capabilities.
“ Right now, what makes an effective CTV creative strategy is uncharted . . . The connected living room is where consumers are now.” — Simon Asselin, Infillion’s CTO.
“CTV outperforms in purchase [3.1x Lift] intent compared to mobile” — Michael Colella, Infillion’s SVP of Creative.
Many CTV remotes these days can be controlled with voice commands, and this can often be incorporated into brand experiences as well. We are still early days for voice controlled advertising.
Strong visual cues are key. You’ll find CTV ads work best when it is extremely clear to viewers how they should interact. CTV is still a relatively new medium, and consumers in a lean-back television environment aren’t instantly accustomed to interacting, so don’t hesitate to provide more rather than less information.
By 2024, it’s estimated that 5G will cover 40% of the globe. With 5G, you’ll be able to use a wide array of internet-enabled devices — including CTV — simultaneously without bandwidth issues. It’ll also be possible for multiple feeds to be piped into a CTV device simultaneously, which has big implications for genres like live sports — allowing for viewing enhancements like multiple angles, live stats, and gaming.
With 5G, your brand messaging can gain more territory.
Running a CTV ad campaign that gets the desired results will require you to test the waters and choose the right creative and tech partners to help you bring it to fruition. There is nothing wrong with pushing the edges of the envelope to build a cutting-edge award-winning execution for a brand.
Assembling medium- or long-term plans for a connected TV strategy requires continually checking yourself on a fundamental question: what if everything changes?
Addressing your CTV measurement challenges head on can help the advertising industry ensure that CTV offers a clean, well-lit, fraud-free environment.
Targeting has historically been fuelled by cookies and device IDs, but it’s steadily getting limited by regulation; adjusting for a post-cookie world seems inevitable.
Digital video’s potential for interactivity makes it possible for new kinds of targeting — and they’re perfect for CTV.
Addressability — the ability not just to target a household, but to an individual member of that household — has been a hot topic in the TV advertising industry for years now.
Targeting is probably the area where CTV differs most dramatically from other digital video. Approaching it effectively requires a total rethink of many longstanding tactics of digital marketing, from cookies to credentials.
Committing to advanced verification and working with reputable partners and channels, even if it seems costly or complicated, is an absolute must in CTV advertising right now. Audience shifts toward streaming video in the living room mean that a top-shelf investment will pay off.
Marketers must create a competitive advantage for accessing CTV media — through annual partnerships, joint business planning and beyond. The environment is here to stay and recent research suggesting there are more HHs that can be reached via CTV advertising than through TV.
The average spot for a large brand advertiser on CTV drove an approximately 6% incremental increase in brand awareness relative to baselines.
Video spots in CTV environments deliver an approximately 13% increase in “intent” even after normalizing for variation in vertical-specific objectives such as purchase, watch or visit intent.
But after 5 experiences interacting with brands in shorter commercial spots, about 8 out of 10 CTV viewers choose to interact. So, while CTV’s relative novelty means less enthusiasm to interact initially, it catches up quickly as consumers realize that what they’d been considering to be a lean-back environment — television — really is the ultimate opportunity to lean forward.
By the way, if you are interested, you may access the complete Infillion’s CTV Playbook here.
Here’s related information that you may find helpful: 21 Key Insights On How Brands Can Reach The New Grocery Consumer.
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