The connected television (or CTV) snowballed as a media channel during 2020’s lockdown, buoyed by increased streaming and record sales of devices. The increased adoption of these internet-connected screens enthused software providers to fast-track the development of CTV ad products to attract budgets from digital, social and TV. As part of The Drum’s deep dive into the future of TV, we look at how media buyers are navigating the burgeoning medium.
What the buyers say
Michelle Sarpong, trading director at The7stars, says the easiest-to-buy platforms will win – and that those are currently in the broadcaster video-on-demand (BVOD) space. Welcome news for the legacy broadcasters, which are arguably late in joining the melee.
For AV teams like Sarpong’s, BVOD will be closest to what they are used to. Agencies are bulking up their CTV skills now, largely with staff who became familiar with it supplementing diminishing TV audiences in live linear. That’s a trend the legacy providers are increasingly nonplused about. UK BVODs noted record consumption in their on-demand platforms this year. The belief is that once people start scheduling their own TV routines, they won’t want to go back.
But in the digital realm, media owners get a lot more data feedback about their viewers. Sarpong says the space has “matured significantly” and that CTV is now a “bigger part of the TV conversation”.
But it could be easier to buy outside of the direct relationships. The programmatic buying route is too complicated for many, while for the new entrant the littering of acronyms like BVOD, AVOD (ad-funded video-on-demand), and SVOD (subscription video-on-demand) can prove confusing.
It is also playing catch-up with more established mediums. Measurement needs to be standardized and some providers need to get a grip on frequency capping – people are still seeing the same spot multiple times in the same session, which can actually harm a brand. Broadcaster video-on-demand remains the “easiest” to buy, Sarpong says.
Meanwhile, Joe Evea, director of Media 16, an agency specializing in selling CTV inventory, says CTV offers advertisers a premium environment and high levels of engagement, just like traditional TV but with the “advantages of accountability and measurement”. That’s the ideal at least.
“It offers cost efficiencies and complete flexibility in testing and scheduling a range of creative executions to ensure an advertiser receives maximum exposure for the right price.”
But to get the budgets, those spending will have to evidence the effectiveness. Evea believes measurement is improving, particularly via companies like Adalyser and TV Squared that have started offering audience attribution.
The adtech infrastructure is shifting to monetize this flood of new users.
Paul Gubbins, head of CTV strategic partnership at Publica, says most of the top supply-side vendors have CTV inventory, largely from free ad-supported streaming television (FAST) services. They can be targeted by the majority of DSPs used by advertising agencies.
In the UK, much of the inventory is fulfilled by AVOD apps including Pluto TV, Roku, Rakuten and Samsung TV Plus. They’re all reportedly being adopted at record rates.
For new advertisers, Gubbins encourages conversation with agency specialists (like GroupM’s Finecast) or an independent CTV company (like LightBox TV) to help identify what services share the brand’s consumer base. “You can then build out best practices to follow when you want to engage with them and the best path to target that supply,” he says.
“They will also be looking at how the AVOD apps have constructed their ad breaks and what ad pod controls they have put in place to ensure you – the advertiser – can manage things like frequency and competitive ad separation.” (He says more here.)
Rhys McLachlan, director of advanced advertising at ITV, (naturally) urges brands to buy their CTV allocations direct rather than depending on the SSPs to serve up relevant stock.
“If you’re buying CTV inventory that isn’t from the established UK broadcaster or one of the well-known streaming entrants, what are you buying? If you're not buying from a known established entity that you are familiar with or has precedent or provenance from another market, I genuinely question where you think your ads are going.”
The worst of CTV is the “equivalent of the dark web”, he warns. As it prospers, fraud become more profitable – and the space has not been without trouble. Generally speaking, however, he’s excited: “This is TV on steroids.”
What the media owners say
In 2021, streaming company Roku reached 51.2 million active users globally, up 39% in a year. Mike Shaw, director of international advertising sales at Roku, says we’re entering the “streaming decade”.
He says CTV has made TV advertising accessible to brands of any size. At Roku, he’s promising “the ability to drive campaigns throughout the entire marketing funnel, from awareness efforts to performance campaigns”. It’s a more dynamic platform than TV ever was, he says. “It is another reason why we are also seeing digital and social budgets move into streaming.”
But to attract AV teams bloodied in TV buying, the process needs to be as simple as trading across linear TV with accurate inventory forecasts for premium content in brand-safe environments. For Roku, the OneView Ad Platform manages buys across OTT, linear TV and omnichannel. He believes the platform’s personalized ads are “far more effective than traditional TV”. That traditional TV is also going in this direction lends credence to the claim. “TV has historically been for branding and digital was for performance. Connected TV advertising is for both.”
James Collins, senior vice-president of media networks at Rakuten Advertising, reminds clients of the benefits of advertising on “the biggest screen in the house”.
“CTV offers the beauty of television and the brains of digital,” he says. But there are misconceptions about what it can and cannot do. Collins says that, for one, a TV is more often than not a shared device, unlike a smartphone for example. That changes how you approach personalization.
“It must be seen as offering the chance for brand messages to connect with consumers in the moment that they are most likely to engage; such as an FMCG brand advertising its leading washing powder after a family-friendly adventure film, for example.”
With the coming demise of third-party cookies in Google Chrome this coming year (or two), the CTV offering could become ever more enticing to buyers keen for strong first-party insights about viewers. But it is not a like-for-like replacement.
“CTV has an identifier, but that TV stays on the wall in the family living room and is likely watched by multiple people. The idea of deterministic retargeting doesn’t apply to this branding environment.”
The software knows who you are and where you live, offering some targetable options for brands. It also knows what you watch and can determine relevant ads from there. There’s a contextual piece playing out here around timing.
“The viewer is a different person at 8.30am getting ready for work than they are at 8.30pm kicking back to watch a Hollywood blockbuster. We’re all different versions of ‘us’ depending on the time of day, how we’re feeling, who we’re with and what we’ve experienced that day. Likewise, the audience’s mood is different, and therefore how receptive they are to certain suggestions and messages has changed.”
So Collins is strong in his opinion that CTV is a branding channel for now, but it may not always be the case. Multiscreen responses could come, like offers sent to a smartphone in conjunction with the viewing of a TV ad. And shoppable ads could give some brands the direct performance they need.
But for now, advertisers still face a whole lot of choice, and floods of grand claims about the medium. And with the vaccine roll-out enabling outdoor adventures once more, all these record audiences can slump. On the other hand, content producers will flood back out to produce a backlog of premium shows and movies that we’ve missed.
Time will tell how the CTV habit will stick.
From late April until early May, The Drum is taking a deep dive into what’s in store for the small screen as we launch our Future of TV hub. Sign up for The Drum’s Future of Media briefing here.