So far, 2020 has been a year we’d prefer to forget, but it will be remembered for the pandemic. The spread of Coronavirus has reminded us of a similar global event the early 1900s yet what we’re experiencing today is more challenging. With most generations having no previous experience of such an event and lockdowns, most businesses, workers, and Governments have struggled to come to terms with the ‘new normal’.
The effects of the pandemic will be felt for many years to come and we will adapt. Cancellation of traditional advertising campaigns has seen a new shining star emerge, i.e. CTV.
Digital video has been a reliable advertising channel for businesses, particularly in the CTV space, i.e. video served on a connected TV.
So the questions we will answer:
What’s making CTV promising for brands, and how is CTV working for publishers, i.e. ad monetization?
In this blog post, we share our opinions, but first, here’s a quick overview of CTV.
What is Connected TV?
CTV stands for ‘connected TV’ and relates to devices, like smart TVs and boxes, sticks, and devices streaming content via broadband. In its turn, OTT stands for ‘over-the-top’ and means the technology which is in charge of serving video content via SVOD or AVOD services.
During the past several years, the audience of CTV viewers has been rising. For instance, according to the Marketing Charts, in 2020 80% of US TV households have at least one CTV device, compared to 74% in 2019.
Along with the increased ownership of CTV devices, the viewership is also on the rise, as more adults are viewing entertainment via CTV. Specifically, this year 4 in 10 US adults watch videos on a CTV device daily.
The growing viewership and consumer demand among the audience make CTV a promising ad channel for marketers. And many of them have been investing in this medium for a while. As per the recent report by IAB, CTV ad spending in the US will reach $10.81 billion by 2021, showing the increase from $7 billion spent in 2019.
Brands that invest in CTV ads the most represent retail, media, entertainment, and telecom categories.
Besides, demand for CTV advertising engenders supply. There are over 18k apps on Roku store alone, owned by 5.17k publishers. CTV apps owners, who are seeking the ways to efficiently monetize ad spaces, at the same time provide marketers with ample opportunity to display their ads in front of a broad audience of potential buyers.
What Makes CTV Advertising Effective?
There are several essential reasons why advertisers go for CTV.
- Extensive reach that comprises millennials,cord-cutters and cord-nevers, unreachable via linear TV ads;
- Sophisticated targeting, that, unlike in traditional TV, allows in-depth ad personalization;
- Higher viewability CTV ads are non-skippable, plus they are served in a more immersive environment than, say, video content on a smartphone or laptop often accompanied by multitasking;
- precise results measurement is one of the most significant advantages of CTV advertising. CTV ads are typically purchased and served via CTV&OTT ad platforms like this, letting advertisers connect with publishers directly and ensure their ad budgets last longer.
How Can Publishers Hit in the CTV Sweet Spot in 2020?
The broad CTV audience is just one variable resulting in growing ad spend. This year, we witnessed several game-changing events contributing to it.
Specifically, due to COVID-19, there were cancellations and delays of the major industry events. For example, TV Upfronts, one of the largest gatherings for TV ecosystem participants, has moved online. Other variables that added to the shift of ad budgets include political and social activities, which resulted in big brands boycotting ad opportunities brought by Facebook.
All this has changed the outlook of ad budgets reallocation across the ad channels. For CTV publishers, these challenging times are also times of great opportunities. The ones who can embrace the growing momentum of CTV will gain and maintain the lead.