The consumption of Connected TV (CTV) and Over-the-Top (OTT) content continues to be at the forefront of one fastest growing environments, video, in digital marketing. Year on year, we saw extraordinary growth with video ad spend increasing 70% to a record £2.2bn. Combine this with the increases seen in programmatic ad spend, then programmatic CTV is a no brainer.
Connected TV is one of the most used digital devices, presenting an enormous opportunity for advertisers
According to eMarketer, CTV ad spend is expected to see continued growth in 2022, reaching 66% of the UK population and accordingly to IABs Real Living study, CTV is now one of the most used digital devices in the UK household, second to smartphones. Whilst the growth of CTV is not a new trend, it’s clear to see we are following on from similar trends in the US, which continues to accelerate exponentially and lead the way.
This offers huge potential for advertisers, as CTV offers an abundance of free to view content accessible by a huge proportion of the UK population through one or more connected devices, whether this be on their Smart TV, streaming device or gaming console. Consumers are increasingly becoming more fluid in the ways in which they consume and stream video content, from desktop to mobile to now being fully cross device with many viewing on the largest screen in the household. For many users, CTV viewership is a shared experience, with most streamers watching with a partner or family member, and so we can forecast a co-viewing rate of 2-3.
With the connected world we live in and on demand services available, CTV viewing is not an occasional activity, it happens regularly and for many viewers, it is the primary way they watch television. Importantly for advertisers, the regular viewers of CTV are also more accepting of ads in exchange for free online services and claim they feel less intrusive than live ads.
With the increased shift towards CTV, and viewers actively seeking ad supported content to access free streaming video, brands need to evaluate and adapt their video strategies to ensure their media plans are reflective of current consumer viewership. It’s important for advertisers to consider how they can utilise connected TV as part of their overall video strategy to gain incremental reach and captivate a cross generational audience in a sound on environment, bringing their ads to life in the biggest screen in the household.
CTV bought programmatically is addressable, flexible, and efficient
eMarketer estimates that almost 60% of CTV inventory will be bought programmatically by the end of this year, and at Merkle we fully support this. We believe that by integrating CTV buys into your programmatic strategies, advertisers can benefit from the flexibility, diverse capabilities, and customisation opportunities from greater targeting that programmatic has to offer, as well as unlocking automation and addressability.
1. Programmatic CTV combines the quality experience of TV viewing, with the data driven approach of the digital world
This allows you to be more relevant and effective with your media, resulting in better performance. Research carried out by Unruly, proved advanced targeting capabilities from CTV leads to users finding an ad more memorable when compared to the average UK TV viewer. Using a data led audience approach to tailor your ads to the topic or tone of the content or reflecting the current situation of the user can be incredibly powerful, especially when combined with the use of tailored creative.
2. Programmatic CTV allows for greater flexibility, giving a view of real time pacing and performance
Activating within the programmatic ecosystem enables you to reach your target audience in a singular programmatic transaction as opposed to buying on a network-by-network basis for the traditional big screen. Alongside this, with all buys consolidated within one platform, you have the ability to pull levers and make quick adjustments in campaign flight between different media buys using the power of automaton and removing the manual execution process used with traditional buys.
3. Guaranteed outcome-based media offerings from key players allows for greater efficiencies
We’ve seen recent shifts from key players in the market such as Roku & LG Ads who have recently launched guaranteed outcome products within the CTV space. Roku’s partnership with Nielsen allow advertisers to only pay for ads served to a target audience, whilst LG Ads, Guaranteed Outcomes promises that advertisers will only pay for their CTV buys if they hit certain media KPIs.
As one door closes, another opens. The future of CTV is now
With recent changes coming into play such as Apple’s iOS 14, which asked users to opt into mobile app data tracking, we could see further shifts towards CTV.
The elimination of third-party cookies will become the most significant challenge of all in the industry. For CTV, however, this will offer new opportunities as the ads do not rely on cookies and advertisers turn to increased contextual buying to engage relevant audiences on the big screen. We highly recommend testing contextual, cookieless environments to get ahead of one of the biggest challenges in our industry. We expect Connected TV to be the key driver for growth within the digital space.
How can Merkle help with your Programmatic Video and Connected TV Strategy?
Over the past year, we’ve been working with different partners within the CTV landscape for some of our biggest brands. Whether it’s been to extend their reach to new audiences, activating impactful environments cost effectively, testing ahead of the cookieless future or simply to elevate their video strategies, we have a whole host of different learnings on how CTV can be deployed.
If you’re considering Connected TV or programmatic video strategies for your brand, contact us to find out more.
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