Connected TV Advertising Or Better Known As CTV Advertising Is Changing The Game
Research shows that as of the end of May 2018, approximately 13.5 million households across America no longer watch traditional TV.
The driving reason behind this trend (known as cord-cutting) is the extensive use of television (TV) sets that can connect to the internet. Viewers often use these TVs for other purposes beyond just watching the shows. As a result, new ways to advertise to viewers are cropping up.
Connected TV advertising is an approach you can use to advertise to this new crop of viewers. Here is a deep-dive into what connected TV (CTV) is and why it should matter to your business.
What Is Connected TV?
Connected television refers to any device that is created to connect to the internet and support multimedia. Examples of CTV devices include video game consoles, streaming video devices, smart TVs (i.e., those that can connect to the internet), among others.
CTV is the bringing together of the internet with the TV. Traditional TV places a supreme focus on media broadcasting. In contrast, the main focus of CTV is online interactive media, over-the-top (OTT) content, on-demand media streaming, and internet TV.
Through CTV devices, users access a video streaming service to watch a movie or TV series they prefer. They can also access other kinds of media like photos and other online digital content.
Users can get the content they desire through an interface that’s similar to the one on their smartphone. Web widgets and other software applications are also access points through which users can get to the content.
How Connected TV Advertising Works
CTV is a channel through which users access OTT content. Thus, when users are watching a show, it’s over the internet rather than via TV station broadcast. Besides that difference, the experience resembles what watching a traditional TV show is like.
Since the audience desires to watch OTT content, they are willing to sit through advertising integrated into the content.
The Connected TV Ad Opportunity
According to the 2019 OTT Consumer Report, more than 50% of the American population now uses an OTT device. The implication here is that streaming TV content has now moved from being a niche hobby to a meaningful market.
The nature of the viewing experience on OTT is also another factor that makes advertising via CTV a valuable opportunity. When people are watching traditional TV, they typically switch channels or leave the room when an ad comes on.
With CTV, the ad is part of the show. As such, viewers tend to sit through such commercials more, and that insight is what makes CTV advertising so effective.
In 2018, advertisers spent a mere $2 billion on OTT ads as compared to the $70 billion invested in traditional TV advertising. Given the fact that OTT content now captures over half the population’s viewing time, it’s clear that a shift is on the horizon for advertisers.
Do not forget that not all viewers of OTT content are merely adding it to the other content they watch. Data from the 2019 OTT Consumer Report also shows that 15% of OTT viewers are cord-burners, i.e., viewers who do not watch any live TV. Additionally, the report also states that most people who watch OTT content consume more of it per day than live TV content.
Therefore, the CTV advertising market is both large enough for your business while also offering better exposure per viewer.
The Advantages of Advertising on Connected TV
With traditional TV ratings dropping and more viewers avoiding linear TV ads, CTV is in place to be the future. Some compelling reasons that make CTV ads viable for you include:
1. Reach the Right Audience When It Matters
Traditional TV typically targets audiences according to daytimes and demographic information. CTV, on the other hand, relies on more granular user data to target viewers according to their immediate interests and needs.
The result is that traditional TV ends up having a broad reach but lacks the precision necessary to target viewers beneficially. As a result, you end up footing the cost for viewers that are outside your target audience.
With connected TV, you can use finely tuned data to enable you to target more relevant viewers. For example, instead of advertising on a cooking show on traditional TV, you can also target ‘foodies.’ That empowers you to serve your commercial in a more precise manner.
Your advertising return-on-investment stands higher chances of yielding more fruit as it reaches the relevant viewers at the right time.
2. Increase Your Traditional TV Ad Impact
CTV advertising helps increase the impact of your other advertising efforts.
Statistics show that when you add one CTV ad to your traditional TV campaign, you receive a 34% increase in ad recall. That is in comparison to the 6% increase you would get from adding another conventional TV commercial.
Additionally, the data from the same source also indicates that viewers regard your brand more when they see it on CTV as well.
Since CTV ads offer more efficiency with every exposure, you add more weight to your traditional TV campaign with every CTV ad.
3. Higher Quality Ads
CTV supports the transmission of highly personalized, high definition content with stereo sound. Therefore, you can deliver commercials of a higher quality.
Such ads can reflect favorably on your brand and help you promote customer loyalty.
CTV is everywhere. Due to the mobile nature of the devices that can transmit CTV content, you can reach target audiences in and out of the home.
As you don’t only depend on your viewers being near a TV, you increase the instances where you can display your ad per viewer. That then translates to more exposure.
5. Real-Time Feedback
Unlike traditional TV advertising, you can receive real-time feedback on CTV. You can keep track of metrics that reflect real-time insights, such as the number of views, clicks, and conversions.
Consequently, you can make decisions about your campaign when the need crops up for better results.
Expand Your Advertising Reach
Technology is upending the way people watch TV, and that has several implications for advertisers. With the rise of smart TVs, you have an opportunity to expose your brand to a better-targeted audience in a more cost-efficient manner. Using connected TV advertising or programmatic video, you can reach cord-cutters and cord-burners to grow the audience you present your brand to.
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