While TV advertising’s current evolution could just be seen as another expected shift in a more extensive trend line of human behavior, market changes, and technology, for brands able to take full advantage — it’s a significant opportunity that doesn’t come twice.
Emerging opportunities in connected TV (CTV) and over-the-top (OTT) streaming advertising provide brands with unique ways to gain a competitive edge within the critical window of this year and early next. Learn the real-world benefits of adding OTT advertising into your media mix, so you aren’t playing catch-up with your competition. Key benefits, such as precision targeting, the ability to measure incremental reach over linear TV ad buys, and the capability to report back on website actions, pack the real punch of unprecedented insight into your TV advertising.
As seen in data provided by Pathmatics, digital ad spending has increased throughout 2022 – with OTT ads, the increasingly chosen option for TV advertising, representing 15% of all U.S. digital ad spend. With changing consumer behaviors and the evolution of the media landscape, its importance within many brands’ media mixes is on the rise.
Linear TV ads take a backseat to OTT advertising
Marketers and businesses are continuing to navigate a changing landscape of terminology — OTT, SVOD, CTV, etc. But the growing vocabulary list doesn’t hold you back from making the most of the right opportunities.
Linear TV
That’s traditional, scheduled TV programming using cable or satellite. In 2022, 52.4% of Americans are watching linear TV. But viewership is projected to decline by over 10% in the next four years alone. Marketers, in turn, have been shifting video ad spending, with now, in 2022, only 57% of US video ad spending going to linear TV. Where’s the budget going? Several places, including Connected TV advertising.
Connected TV (CTV)
Part computer, part television, and part digital media player, a smart TV, known to advertisers as connected TV, is a traditional television with an internet connection. As of 2022, 80% of US households own at least one Smart TV.
No longer limited to scheduled programming, smart TVs can also play a growing list of video on demand (VOD) services, including streaming aggregators and channels such as YouTube, Hulu, Roku, Tubi, Pluto TV, ESPN, Peacock, Paramount+, and Discovery+. A creeping percentage of previously linear TV ad spend is now going to this type of advertising.
What’s considered CTV advertising? Any digital advertising that appears within streaming full-episode player content (FEP) content on a connected TV device. This doesn’t include someone who is watching Hulu on their laptop or mobile phone, it’s only ads shown on connected TV devices.
Over-the-top advertising (OTT)
OTT ads, often confused with CTV ads, are delivered within streaming full-episode player video content regardless of device. Here are a few examples of where people see them:
- Watching Thursday night’s NFL games on Amazon’s Prime Video
- Catching the latest episode of Yellowstone on Peacock
- Revisiting a classic movie on Pluto TV
- Binging reruns of Survivor on Paramount+
These ads aren’t limited to a television set and can be played on any device that streams video – tablets, smartphones, and more. While subscription OTT has slowed due to saturation in the US, its star will still reach new heights within the next two years.
The streaming landscape includes a complex variety of players that many modern marketers might shy away from, focused instead on just getting ads onto a screen. However, performance-driven agency partnerships can help you navigate key relationships, including:
- Data Providers
- Demand-Side Platforms (DSPs)
- Supply-Side Platform (SSPs)
- Ad Servers
- Analytics
- Publisher/Aggregator
Why is this more important than ever before?
Non-pay TV viewers, or cord-cutters and cord-nevers combined, will outnumber pay TV viewers for the first time in 2024.
eMarketer, TV Ad Spending 2022
With an expanding and fragmenting TV advertising landscape and a quickened pace of changes in consumer behavior, performance-driven agencies can help navigate through the ecosystem to drive real business results.
Benefits of OTT advertising
Offering rising reach, precision targeting, and efficient measurement, OTT ads have leapt past what the traditional TV industry could offer advertisers. Today, the majority of Gen Z, Millenial, and even Gen X audiences in the U.S. are digital video users, frequently viewing OTT ads.
Rising reach
Internet-connected devices supersede primetime broadcasts for many audiences. Beyond the rise of smart TV and streaming device ownership and the fall of satellite and cable users, ad-supported streaming services are growing. While big names include Hulu, Peacock, Sling, Paramount+, HBO Max, and Pluto TV, Netflix will now join them. Launching its ad-supported tier in the US on November 3, the expectation is other holdout streaming service companies will follow suit.
Precision targeting
Brands can limit unwanted impressions and increase the effectiveness of your CTV and OTT spend by leveraging other data resources. For example, our proprietary data platform XactAudience® can provide impactful prospect audiences based on targeting criteria or builds predictive models from the best existing customers that drive better performance with user profiles sourced from over 250+ million consumers with 4,000+ demographic and psychographic variables.
OTT advertising can eliminate ad waste, with every dollar spent reaching only your specific audience. OTT ads slough off any “wide-net” comparisons to linear TV advertising. Customize advertising with unique ads for different viewer, based on key audience details including:
- Demographics
- Psychographics
- Affinities
- Interests
- Geographical location
- What they’re shopping for
- What products they currently use
- And more
OTT ads can utilize digital’s full power of audience building and modeling. Having the access and ability to know more about your audience — behaviors, habits, interests, etc — is what turns your OTT efforts from ‘just another ad’ into an efficient, waste-free touchpoint.
Unprecedented TV measurement
While traditional TV advertising attribution has been based on broader demographics and information, OTT’s digital capabilities can drill further into ad performance and viewer behavior. This ultimately can result in matches down to a household level — if you have access to the right partnerships, databases, and more. Aiding cross-channel visibility, OTT helps marketers deal with increased pressure to maximize spend in the multi-touch landscape. Analytics can report on ROAS/CPA, while optimizing towards the best possible performance.
Beyond its well-known benefits, OTT ads offer cross-platform capabilities with unprecedented levels of insight into your linear TV efforts, measuring how effective your OTT is at reaching new, incremental people that weren’t reached with linear TV buys.
In the field with OTT ads
TV ads are viewed, especially by older generations, as a type of ad only reputable brands use, creating high levels of brand trust beyond just awareness. This translates into the new TV landscape. But there’s so much more that adding OTT ads can do.
Our teams have achieved increased incremental conversions directly attributed to people after they see a CTV ad, tracked via our call tracking. This means someone sees a CTV ad and calls the number on the screen, a number unique to only one CTV spot, and that can be specifically attributed within our tracking system. We’ve also seen increased conversions when CTV ad audiences are retargeted with display ads post-TV spot. Furthermore, OTT ads open up eyes into “view-through conversions.” That’s when someone sees a CTV ad on their connected TV device, then goes to their phone to do a Google search or goes to the website and converts, and we’re able to attribute this back to the CTV ads.
For one client campaign, our team identified that the search conversion rate (without The Trade Desk ad exposure) was 6%, but when coupled with a The Trade Desk CTV ad, that conversion rate increased to 14%, illustrating the importance of considering all touches when assigning last click credit. This is just one illustration of improved attribution, building a full, clear view of your ad dollars at work.
Incremental lift for a national nonprofit
We worked alongside one of America’s largest nonprofit childcare agencies, which supports more than two million people each year, to supercharge their annual giving season. When we enhanced their direct mail campaign by serving OTT ads to the same audience, the nonprofit saw a 35% increase in incremental lift — resulting in an influx of direct donations.
Yet, beyond just exposure, OTT can actually also add engagement into your campaigns.
High-level engagement for an award-winning medical system
A prominent, academic medical system offering award-winning care for over 100 years originally came to us looking for more brand exposure. We developed and executed an OTT campaign that not only grew brand awareness but over-performed with high-level engagement, resulting in over 2,000 people visiting their appointment booking webpage.
These are just a few examples of how integrating OTT ads eliminates waste and advances your media mix.
How Amsive Digital can help
Adding CTV and OTT ads into your media mix doesn’t have to be jarring, as there are additional things to think through. From ad creative to audience extension and precision targeting, OTT ads will open up other lanes of decision-making about your digital marketing. However, ultimately, facing these choices allows you to make smarter decisions — resulting in measurable marketing achievements.
Our team helps clients weigh their options to maximize the right opportunities through:
- Access to brand-safe Tier 1 networks, major SSPs, Direct TV, Comcast, Sling TV, Hulu, and more, allowing for an extremely competitive number of addressable viewers
- Our proprietary data platform XactAudience® with user profiles sourced from over 250+ million consumers with 4,000+ demographic and psychographic variables, we provide impactful prospect audiences based on your targeting criteria or build predictive models from your best existing customers that drive better performance.
- Robust and transparent real-time reporting dashboard, including performance metrics such as ROAS/CPA and optimization toward the best possible performance
- Audience extension by retargeting CTV viewers with subsequent retargeting banners within the same household
- Acting nimby, avoiding many minimums and shifting budget fluidly between providers, campaigns, creatives, and more at a moment’s notice based on real-time changes in performance
The addition of OTT ads into your media mix is an inevitability for many brands. Capitalize on the timeliness of OTT advertising as it rises to the forefront of digital marketing instead of trying to catch up when it’s already too late, while strengthening your media with even more insight.
OTT is just one way the digital media, marketing, and measurement ecosystem is evolving. Learn more about what’s next in digital with The Future of Measurement: Attribution, Incrementality, and What’s Next in Ad Testing.
