By Dan Larkman, CEO of Keynes Digital
The connected TV (CTV) advertising landscape underwent significant shifts in 2024, bringing both challenges and opportunities for brands and platforms. As we look back, several key lessons emerge that reflect how rapidly this market is maturing and what lies ahead for advertisers, content creators, and technology companies.
Live Sports: The Game-Changer
Live sports turned a significant corner in 2024, with the Olympic Games leading the charge. Historically tied to linear broadcasts, this year marked a watershed moment as Peacock opened its Olympic streaming inventory to programmatic advertising. For the first time, advertisers from diverse industries had the chance to align themselves with live Olympic sports through streaming platforms.
This shift demonstrated the impact of live sports on brand visibility and audience engagement. Post-Olympics, networks and advertisers doubled down on live sports, recognizing it as a crucial pillar for retaining audiences and driving premium ad revenues in a fragmented market.
FAST Channels: A Growth Frontier
The rise of Free Ad-Supported Streaming Television (FAST) networks has been a defining trend of 2024. These platforms, like Tubi and Pluto TV, have seen a surge in viewership, especially among late adopters aged 55 and older. As subscription prices for platforms like Disney+, Netflix, and Max climbed steadily, cost-sensitive consumers flocked to free alternatives, expanding the available ad inventory.
This growth has opened doors for smaller brands to enter the CTV space, enabled by lower creative costs and competitive outsourcing to international markets. New technology platforms have made CTV more accessible, helping advertisers target audiences with precision while staying within budget.
The Subscription Squeeze
The economics of streaming have been a double-edged sword. Subscription prices rose across the board in 2024, with Disney finally achieving profitability. However, this price inflation has driven some consumers away from paid services and toward FAST platforms. The streaming wars are intensifying, with major players like Max and Paramount+ pushing international expansion while Apple, Amazon, and Google battle it out with NBCUniversal, Warner Bros., and Comcast for dominance.
Netflix, in particular, faces a pivotal moment. Having introduced ads to its platform this year, the question remains whether Netflix will eventually adopt a FAST model to sustain its competitive edge. While it continues to fund top-tier talent and content, the economic pressures of the market could force a strategic pivot.
Tech giants like Amazon, Apple, and Google have a distinct advantage in the streaming market: the ability to absorb losses and continue investing. These companies use streaming as a gateway to their broader ecosystems, unlike traditional studios that must rely on legacy intellectual property (IP) for survival. This disparity is reshaping the industry, with tech companies leading innovations in user interfaces and user experiences (UI/UX). Amazon has invested heavily in improving its ad offerings on Prime, while Apple struggled to consolidate streaming services under its Apple TV app due to the growing sophistication of built-in TV hardware.
Creative Costs and AI Advertising
The barriers to entry in CTV advertising are lowering. The number of creative agencies has grown, driving down costs and making high-quality video content accessible to smaller advertisers. However, this democratization comes with its pitfalls. AI-generated ads, while promising, have yet to reach a quality level acceptable to most audiences. Poorly executed AI ads underscore the need for regulatory frameworks to ensure responsible implementation and maintain consumer trust.
Measurement and Fragmentation
Measurement has been a hot topic in 2024, as advertisers demand greater transparency and third-party verification. The delay in Google’s cookie deprecation has complicated efforts to establish a unified framework for CTV audience measurement. As a result, the ad market has become increasingly fragmented, with numerous platforms and solutions vying for dominance. This fragmentation underscores the need for standardization to help advertisers better evaluate the effectiveness of their campaigns.
Through the Consumer Lens
At the heart of these trends is the consumer. The modern viewer is price-sensitive, platform-agnostic, and highly engaged with live content. Advertisers must navigate these preferences while adapting to a market in flux. The growth of live sports, the rise of FAST, and the evolution of creative and measurement tools all point to a future where advertisers have more opportunities—but also more complexity—to manage.
As we look ahead to 2025, the CTV advertising market is poised to further evolve – as always. The lessons of 2024 highlight the importance of agility, innovation, and a consumer-first approach. For those who can adapt, the rewards will be significant. For those who can’t, the streaming wars will leave little room for complacency.