By Dave Rosowsky, Chief Product Officer at Incubeta US
As the industry continues to come to terms with Apple’s updates around privacy, and prepare for the loss of Google Chrome’s third-party cookies, channels such as mobile and in-app advertising are slowly losing their reach.
While this has been going on, connected TV (CTV) – which is free from third-party cookies – has seen its viewing figures increase in a massive way, growing by four billion hours per week in early 2020. And, despite the gradual lifting of restrictions in places around the world, these viewing figures have continued to be higher than they were before the pandemic.
Consumers have been slowly moving away from linear TV for a number of years, but the pandemic accelerated this transition, as most of the world was forced to stay mostly indoors. This boosted popular paid-for platforms, like Netflix, but also meant big business for ad-supported platforms, which offer more flexibility and affordability than both linear TV and subscription video-on-demand platforms.
The CTV opportunity
CTV, though previously regarded as not offering premium inventory, now presents advertisers with another way of delivering dynamic and creative ads, without using any personal data. As such, CTV was the fastest-growing area of digital video advertising in 2020, with spending increasing by 22%, according to IAB research. And, this year, 73% of CTV buyers reported shifting their budget from broadcast and cable to CTV.
Though most of the budget shift is ‘broadcast and cable to CTV’ at the moment, we’re eventually going to see social, display, and search budgets move in the same direction – much like the shift that occurred when linear TV advertising began to take off in the mid-20th century.
At the same time, CTV is not just a single platform. It refers to premium content that is streamed through either a smart TV or through an over-the-top device or platform such as Roku, Amazon Fire TV, PlayStation, Apple TV, Xbox, Chromecast, and Nintendo Switch, to name a few. So, there are a number of channels that people can access content on pretty much all day, every day.
Getting creative with CTV
For advertisers, this means there has to be a focus on creating dynamic and engaging ads that are relevant to where and when viewers are consuming video content. And the lack of one-to-one personalization means there is no choice but to focus on creating these kinds of experiences for consumers.
With the reliance on third-party cookies and programmatic advertising, creative has often been neglected. But it’s now having a bit of a renaissance as the industry continues on its data privacy journey. And good creative campaigns mean success across the board, especially on CTV.
CTV opens the door to developing unique creative featuring calls to action and interactive elements that drive consumers further down the funnel. This interactivity will soon extend to the ability to deliver shoppable content. Eventually, consumers will be able to watch an ad and click on an on-screen button or banner to buy the product they’ve just seen. Nonetheless, elements like QR codes and dynamic overlays already present the opportunity to engage the consumer and provide them with more information about a product or service. Platforms like Hulu offer the ability to reach viewers on the pause screen with relevant ads that can be interacted with.
Rules of engagement
Despite all the interactive elements that can be embedded into CTV advertising, the big question is whether or not viewers will actually engage with ads during what tends to be a time for them to relax and unwind. A study from Hulu found that 66% of consumers describe their video streaming consumption to be a ‘lean back’ experience. However, interestingly, it seems that viewers are willing to ‘lean forward’ when it comes to ads within their CTV experience.
True[X]’s recent CTV Playbook reports a 3.1 times to lift in purchase intent on CTV compared to mobile. What’s more, a survey from a few years back found that 76% of TV viewers would be open to the idea of purchasing products in real-time using their remote controls.
So, the evidence is there that consumers are willing to engage with CTV ads – especially when they’re relevant.
To encourage this engagement, there needs to be an investment in innovative creative across all CTV channels. CTV offers the ability to buy programmatically within all of these channels and devices, enabling advertisers to get really creative with the types of videos that they’re serving, even by just adjusting lengths based on where and who is likely to be seeing the ad.
CTV is evolving rapidly – however you may have felt about it in the past – and it now offers a premium environment for marketers to reach consumers in the privacy-first world we’re heading towards. It’s time to start thinking about how CTV can fit into future media planning and make sure your brand doesn’t get left behind as more marketers start to realize the opportunity that creative CTV ads bring.