Connected TV Can No Longer Be Ignored

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The coronavirus pandemic has shifted consumers’ media consumption in drastic ways since March 2020 due to stay-at-home orders, rising unemployment, and social distancing measures. Increased video streaming across Connected TV (CTV) and other Over The Top (OTT) devices is one of the emerging trends that may be here to stay post-pandemic.

For advertisers spending on linear TV across broadcast and cable who are looking for the greatest amount of reach among a targeted audience, Connected TV can no longer be ignored. Not only are advertisers able to expand reach using CTV, but they also can reach a desired audience using sophisticated targeting tactics while gaining performance insights with attribution tracking.

Coronavirus Impact: More Households, More Time, More CTV Streaming

Over 72 million homes are using Connected TV, solidifying its place in mainstream media behavior. 1 As consumers began spending more time at home, media consumption on streaming platforms grew 85% in the first three weeks of March in 2020 compared to the same period in 2019. 2

ComScore identified an 11% growth in the average number of daily households streaming entertainment between the weeks of March 9 to April 13, a jump from 45 to 50 million households. Not only are more households streaming, but also the number of average daily streaming hours increased 24 percent during the same timeframe.3

Almost half (49%) of adults have said they are streaming more now than pre-social distancing, despite variations across generations, education levels, income, and community size. 4

Consumers are spending the most time streaming movies, news, and music since January.1 The benefit of CTV advertising is that ads are targeted to the individual users in whatever content they are consuming. However, it’s important to note that you can also implement whitelist or blacklist content or channels to better align your ads with your brand and target audiences.

Even YouTube is seeing increased watch time growth on TV screens, including movies, TV shows, documentaries, and news. They recently announced new tools and ad formats to capitalize on the growing trend.5 As a Google Premier Partner, Location3 has access to other Alpha and Beta opportunities that enable our brand partners to trial new ad formats and tools before it becomes available to all advertisers.

Since mid-March, users are streaming less on streaming box/stick and gaming device consoles in favor of streaming through CTV. Although streaming box/stick devices still have the majority of streaming platform share, there has been a gradual shift toward Connected TV closing the gap. 3

Connected TV: Increased Reach, Higher Quality, & More Potential

Connected TV can no longer be ignored as part of a video media mix due to its previous and anticipated growth. Nearly nine in 10 consumers confirmed they have access to a CTV device6, and eMarketer predicts that 60.1% of the population is predicted to watch CTV by 2022.7

While CTV usage is growing, so is the number of consumers cutting the cord. eMarketer predicts a decline in pay TV households from 86.5 million to 72.1 million.8 In addition to cord-cutters, there is also a segment of cord-nevers, users who have never paid for cable or satellite TV in their lifetime. By 2023, eMarketer estimates 56.1 million US households will be cord-cutters or cord-nevers.8

The perceived quality of Connected TV content may play a role in advertisers’ recent shift to spend more in CTV.  In a recent IAS & Digiday study, survey respondents found the CTV content quality to be higher than digital video, due to its original programming and exclusive content.9

Many survey respondents also see CTV as a platform for innovation and success, with 44% saying CTV has the most potential for new video advertising innovations and just under one-third saying their video ad content has performed the best on CTV. 9

Now’s the Time for Connected TV

Although marketing dollars are typically one of the first budgets to be slashed when business is negatively impacted, investing in Connected TV right now may be the boost your company needs to reach new customers and maintain your relationship with current customers.

With a surge of increased ad inventory coupled with less advertisers in market, advertisers have an opportunity to test Connected TV at lower rates. YouTube CPMs have fallen more than 20% from highs recorded earlier in 2020, and programmatic ad rates have dropped even lower (beyond 30%).10 CTV impressions haves even exceeded mobile video impressions in the past few weeks. 11

At Location3, we’ve been helping our partners and their local franchisees by developing customized video approaches to reach targeted audiences while also driving results using Connected TV. For more information on how we can help you launch a successful Connected TV media buy, contact us today.

 

 

Sources:

  1. comScore, ‘CTV Advertising: What Every Advertiser Needs to Know to Stay Ahead’, May 4, 2020
  2. Nielsen via Variety, https://variety.com/2020/digital/news/video-streaming-tvs-us-data-coronavirus-nielsen-1203550256/
  3. comScore, ‘Streaming on Connected TVs Increases During Coronavirus’, April 27, 2020.
  4. Morning Consult, https://morningconsult.com/2020/04/30/streaming-favorited-forgotten-analysis/, April 30, 2020.
  5. Google, https://blog.google/products/ads/youtube-streaming-trends-features, May 7, 2020.
  6. Integral Ad Science, ‘Streaming Wars’ Report, March 2020.
  7. eMarketer, https://www.emarketer.com/content/connected-tv-advertising
  8. eMarketer, Q3 2019 Digital Video Trends, October 2019.
  9. Integral Ad Science & Digiday, ‘The State of CTV,’ May 2020.
  10. Digiday, ‘‘We’re creating inventory faster than they can fill it’: Publishers see YouTube ad prices drop 20%,’ April 16, 2020.
  11. Innovid iQ Dashboard, Global Video Impressions by Device, Data through the week of May 3-9.
  12. Featured Photo by Glenn Carstens-Peters on Unsplash
 

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