2018 was a transformational year for connected television (CTV). With 183 million CTV users in the U.S. alone, CTV is on pace to overtake traditional linear TV to become the first screen advertisers choose when they want to reach engaged audiences.
CTV now mirrors and improves on the linear TV viewing experience, and ad dollars are following. In fact, a third of all advertisers on Telaria’s platform now spend more than half their budgets on CTV.
Advertising on CTV is premium, viewable, non-skippable, addressable and can be transacted with the precision and efficiency of programmatic. It is the antidote for brands frustrated with the arduous, old school ways of linear, and frustrated and angry with YouTube’s brand safety issues.
With linear TV’s relevance diminishing and YouTube clearly not ready for primetime, it’s CTV’s time to shine. Here’s how:
Linear and CTV audiences are converging; so are TV ad dollars
The growth of CTV reflects the seismic shift in entertainment choices and the new ways advertisers engage with those viewers. Viewers don’t see the difference; 84 percent of Gen Z, millennials and Gen X TV watchers consider streaming content through their internet-connected TV to be “watching TV.” While some advertisers continue to distinguish between connected and linear TV, consumers no longer make that distinction.
Today, not even high-profile live events stop cord cutters because they can increase access this content via streaming services. According to Conviva, live streaming hours grew 65 percent between 2017 and 2018.
The latest bellwether for CTV growth is that traditionally heavy linear TV buyers—think auto, CPG, entertainment, pharmaceutical and alcohol advertisers—are expressing significant interest in buying live CTV.
As CTV publishers confront subscription fatigue and necessarily pivot to ad-supported monetization strategies, the amount of ad-supported CTV content will increase considerably, providing many more opportunities for brands to reach audiences through sound, sight and motion. Over the next year, agencies and buyers will break down the silos between their TV and digital teams and create dedicated CTV teams to address this growing opportunity.
Political advertisers embrace CTV and look toward 2020
Speaking of big TV buyers, political campaigns are turning to CTV because of the ability to reach the right viewers at the right moment. During the months leading up to the 2018 midterm elections, CTV advertising on Telaria’s platform exceeded political advertising across all screens during the entire 2016 election year. With a crowded field of candidates vying for office in 2020, CTV will become the go-to advertising medium for political buyers.
CTV’s unique ability to offer precise targeting within a premium environment bolsters ad effectiveness for political campaigns. Telaria and national research firm Cygnal found that viewers were more likely to be influenced on a voting decision when they watched a political video ad. Political ad recall is also twice as high on CTV compared to desktop display.
Now with advances in CTV ad-podding technology (such as frequency capping and competitive separation), CTV offers a viewing experience that can exceed that of broadcast. These features ensure ads do not repeat nor play adjacent to an opponent’s ad, a particularly important feature in the lead-up to crucial election dates.
CTV is a complicated ecosystem to navigate … for now
Even with all the excitement around CTV, it remains a complex ecosystem for both advertisers and publishers.
In surveying more than a thousand partners through Telaria’s CTV education program, we found that confusion around OTT and CTV persists, from how to buy CTV advertising to the options through which to deliver CTV content.
Adding to the complexity are the growing number of new content entrants who seek to compete with traditional linear stalwarts and transform their businesses into OTT powerhouses. Throw in the fact that consumers can access CTV via the TV itself (a smart TV), an OTT device (Roku or Apple TV) or even a gaming console (PlayStation, Xbox, etc.) and the choices for ad buyers and sellers of CTV can be bewildering.
At Telaria, we’ve tried to make this world easier to understand with what we call the Telascape, which aims to provide a roadmap through the CTV ecosystem by categorizing companies according to where they sit on the CTV landscape. It’s guaranteed that this map will change as the ecosystem evolves and expands. Ever more publishers, advertisers, and consumers are making the jump to CTV. This convergence of TV and digital is an exciting and scalable opportunity, and we can’t wait to report back on further gains.
Mark Zagorski brings over 20 years of digital marketing leadership to his role as CEO of Telaria. He was previously CEO of eXelate, and led its sale to Nielsen, where he became an EVP, launching and leading the Nielsen Marketing Cloud.