Keeping Up with Consumer Trends: A Look at the Current State of Connected TV Advertising

Author: Shana Atwood, Manager of Strategic Planning at Causal IQ

There’s been a tidal wave of change in the TV landscape as consumers have turned their attention to new over-the-top (OTT) and connected TV (CTV) platforms to get their fix of compelling and captivating stories. But advertisers aren’t keeping up. In fact, just 40 percent of large brands have entered the CTV advertising space, according to “Embrace Connected TV Now to Gain Competitive Advantage,” a commissioned study conducted by Forrester Consulting on behalf of Causal IQ.

Unclear goals, attribution, fragmentation, and the inability to apply digital data to CTV are the most noted barriers to entry for most advertisers. Let’s look at how we can navigate these barriers starting with data and targeting.

One of the main appeals of display advertising is the audience targeting used to increase efficiency and effectiveness of digital media buys. The ability to understand user behavior through cookies and device IDs is nearly priceless. The challenge with CTV environments though is that they are cookieless. Most targeting is at the household level, not the individual level, and requires connecting device IDs for smart TVs and OTT devices with IP addresses. In an age where advertisers are used to finding their exact audience, it’s hard to take a step back to the “old” way of targeting. But changes are coming quickly, and most media buying companies are making new advancements in CTV media buying every day.

Your best bet is to find a partner with a device graph that unifies online and offline data from first- and third-party sources, and across devices, under a single anonymous profile as an alternative to cookie-based targeting. This opens the door to an entirely new layer of sophisticated targeting capabilities alongside tried and true tactics such as cross-device frequency capping. Combining TV and digital measurement will also be crucial for the CTV ad market to develop – and luckily on that front too, there is no shortage of vendors ready to answer the call.

When choosing a partner, be sure they have several preferred partnerships with satellite, set-top-box, and smart TV providers to warrant access to extensive TV-viewing behavior, as well as the ability to measure broadcast to digital overlap.

A few notes for traditional TV buyers:

The wealth of data that our digital footprint leaves behind has made it easier than ever to deliver targeted ads to individual consumers. This may be relatively new for TV buyers, but up against digital media pressure, linear TV is becoming more and more addressable. When considering CTV, the most successful media buyers are familiar with the many nuances of the digital-data-landscape. They know which data providers are in play (1st vs 3rd party) and if their partners have unified profiles or not – a huge advantage over traditional TV buying.

We know that cord cutting is on the rise. With over 200 SVOD options in the US, according to Deloitte’s latest Digital Media Trends Survey, consumers have more options today than ever before. Pay-TV’s decline is especially pronounced among Gen X, Y (millennials), and Z. You’ll want to identify those among your target audience that have cut the cord and rely on other channels such as mobile, email, and CTV/OTT to reach them.

A few notes for digital buyers:

Viewers are more likely to pay attention to an ad on a TV screen than any other device. Over 90% of OTT/CTV video ads are viewed to completion; and when combined with standard display media, lead to higher brand recall, purchase intent, and post-view actions than display alone.

CTV by nature is an awareness tactic, but it can and should always be viewed as part of an omnichannel strategy. Digital media buyers often think of CTV as another inventory source with its own advantages and disadvantages. CTV ads are high impact and command a large share of voice. On the other hand, inventory is much lower as compared to standard video. Targeting can be tricky while measurement solutions are continuing to evolve. These details should be weighed during planning. As a best practice, keep in mind that CTV consumers are there to watch TV first and foremost – and while studies show that ad-supported CTV/OTT viewers are more receptive to ads, you’ll want to keep interactions simple and relevant. Monitor frequency to prevent brand fatigue; and since most CTV ads are not directly actionable, i.e. you can’t click on them, be sure to provide a clear call to action for viewers.

Connected TV poses a massive opportunity for advertisers to continue sharing their brand story at every available touchpoint. Just like mobile, CTV will soon become a standard in digital media buys. Stay ahead of the curve and make your mark on the future of digital advertising.