Get Ready For CTV’s Transformation: Everything Brands Need To Know
After several years in the dark, it’s finally time for connected TV (CTV) to shine. With much of the world under lockdown, the amount of over-the-top (OTT) content accessed on CTV devices has increased dramatically, and this trend is expected to continue.
CTV and OTT devices are rapidly gaining traction and will soon be among the most important video advertising platforms. This blog is for you if you’ve recognised how important CTV will be in 2023. Dive deep into this article to understand the heart of CTV, how it works, and what to expect in 2023.
Why is CTV Advertising More Important in 2023?
Connected TV advertising has quickly become the most popular channel for businesses to reach their target demographic. Here are some CTV data that demonstrate why.
- In the next two to three years, 98% of businesses anticipate connected TV advertising will outperform mobile advertising.
- Half of all video ad impressions are CTV impressions (nearly double that of mobile).
- CTV is now mainstream, with more than one-third of American households using streaming as their sole source of television entertainment.
- By 2022, 87% of US television homes will have at least one Internet-connected TV device.
- Millennials will have 60.5 million monthly connected TV customers in 2022, with a projected increase to 62.6 million by 2025 (+2.1 million).
- According to the IAB, Connected TV ad expenditure will climb by 57% in 2021, reaching 15.2 billion US dollars. It is expected to expand 39% by 2022, reaching 21.2 billion US dollars.
- CTV commercials, according to 63% of respondents, can enable for more exact audience targeting.
What is CTV Advertising?
CTV advertising, or connected TV advertising, enables marketers to contact their target audience via CTV and OTT devices. Advertising is delivered through downloadable programmes that broadcast audiovisual content such as television programmes. With total brand protection in CTV, brands can target their audience by placing advertisements on premium, ad-supported programmes supplied by top-tier networks.
What is CTV?
Before proceeding, it is critical to grasp what CTV implies in advertising. A linked TV is a gadget that uses the internet to stream television information.
The different types of CTVs include:
- Smart TVs
A Smart TV is an internet-connected television set that includes both free and paid services such as YouTube, Netflix, Hulu, and others, removing the need for a separate streaming service.
- Connected Devices
These are over-the-top (OTT) devices that plug directly into a television set, connect to the internet, and provide access to both free and paid streaming services like YouTube, Hulu, and others.
- Consoles for Gaming
To transmit video material to television sets, streaming apps for game consoles such as Xbox, Playstation, and Nintendo may be utilised.
What Distinguishes CTV from OTT?
OTT is defined as quality long-form video content that is streamed over the internet via an app or device onto a TV (or PC, tablet, or smartphone) without the requirement for users to subscribe to a wired cable, telco, or satellite TV service. VAB defines connected devices as “internet-streaming players, game consoles, and linked TVs.
Benefits of Connected TV Advertising
- Increasing Audience
The audience for connected TV has undoubtedly grown exponentially. Indeed, 82% of US households have at least one linked TV device (a greater penetration than cable TV), with an average of 4.1 devices per connected TV household. Furthermore, 30% of individuals consume streaming video on a daily basis, while 60% view it on a weekly basis. (Research Group Leichtman) This is enormous for marketers attempting to get their content in front of engaged consumers! They may now target millennials, Gen Zs, and cord cutters who do not watch traditional television.
- Capabilities for Advanced Targeting
Brands can offer highly relevant and engaging adverts to the appropriate people at the right moments via linked TV advertising. Advertisers may target consumers based on their mindsets and consumer pictures using addressable (GPS), demographic (age, gender, language, etc.), and behavioural (keywords and preferences) data. Furthermore, user registration data enables cross-screen targeting!
- Consumers are More Receptive to CTV Ads
It’s no secret that people are more tolerant of CTV advertising since they are viewing programming they appreciate that is far less expensive than scrolling through stations on cable television: Audiences are more receptive and tolerant of linked TV commercials because they recognise them as a regular part of the streaming experience.
4. Higher Completion Rates
According to Statista, in 2020, 95% of video ad impressions viewed on CTV devices were watched till the end in North America, while the average completion rate stood at 80%. This was probably due to brands including more non-skippable ads within streaming content, ensuring that their messaging was recognised by the audience.
5. Measurable Progress
Since Connected TV advertising is programmatic, businesses may measure their success using several ways such as video completion rate (VCR) and automated content identification (ACR). VCR displays how many times a video has been played to the finish, whereas ACR allows a smart TV to listen to/see what is on TV. Marketers may leverage VCR or ACR data to acquire critical insights into viewing and consumer behaviour in order to better align their ad messaging with what their consumers want to watch.
Brand Safety Issues in CTV
Despite its numerous benefits, CTV advertising, like other media, is not immune to brand safety hazards. There is a considerable chance of airing advertisements with undesirable content on CTV. CTV has the same choice of applications and content as other platforms. Many people are unaware that CTV has pornographic applications, screensavers, and so forth. In summary, CTV is more than simply premium.
Understanding viewers and their preferences is critical in all forms of media. Engaging with them with relevant adverts, on the other hand, is far more vital. If you don’t contact that audience in a contextually relevant place, all you’ve got is a lost opportunity. Ads that are relevant to the context in which they are encountered are more likely to be seen and responded to by users. If the information and offers in the TV commercial are relevant to what the user is experiencing, the person is more likely to become a customer.
CTV is going to shine bright in the coming year. Thus, it is crucial for brands to include it in their marketing mix and boost their ROIs.