Digital advertising and media in general are sometimes confusing. What do all these new terms mean, and for Pete’s sake, is CTV (Connected TV) worth all the hype?
A CTV is any television set that is connected to the internet; this means that connected TV ranges from everything from a smart TV to the TVs connected to set-top boxes and TV sticks. A connected TV would basically give users direct access to streaming video content.
If you’re enjoying video content from a Sony smart TV or a Roku device, congratulations, you’re using connected TV.
Connected TV popularity has skyrocketed these past few years. Statista reports that in the United States alone, over 204 million households own at least one CTV-enabled device. This high number makes up almost 80% of the total US households.
Difference between CTV and OTT
CTV and OTT are among the buzzwords now, and these two terms are often confused for one another, and they are similar, but there is a slight difference.
Over-the-top refers to video content offered to viewers over the internet. OTT services bypass the traditional cable and satellite antenna channels to deliver video content directly to viewers. OTT is also among the video content accessible to you via your connected TV. Consumers can stream OTT content from their mobile phones, tablets, laptops, or smart TVs.
OTT is gaining popularity among consumers because it is more flexible and convenient for viewers to watch their preferred video content on their own time. This is unlike linear television where channels broadcast programs according to a schedule.
So, to put it in simpler terms, connected TV is the hardware in the form of a smart TV, while OTT is the software in the form of an app. Popular examples of OTT services include Amazon Prime Video, Netflix, Disney+, and Apple TV+.
What is CTV Advertising?
Connected TV delivers content from some of the streaming big names like Netflix and Hulu. Most of these streaming platforms have subscription fees from where they generate their revenue, but some CTV services prefer to monetize their content by selling ads to advertisers.
It comes as no surprise that connected TV is one of the fastest-growing digital marketing trends; by 2026, the market is predicted to reach more than $26 billion. For advertisers, the switch to connected TV is exciting as it means new advertising prospects and a wider reach. With CTV, advertisers have a better idea of who is viewing their adverts, and who they want to view their adverts.
As consumers continue to port to the CTV line, the advertising market also experiences a huge swell and anyone who doesn’t get on the moving train is only likely to be left in the dust.
What are the Benefits of CTV Advertising?
CTV ads are pulling their weight in the advertising market, and marketers are taking full advantage of the booming industry.
Reach a wider audience
With the popularity of connected TV, there is almost no household that doesn’t own at least one connected device. Now, different members of a household do not have to watch the same content on the same television. They can enjoy watching YouTube videos via a connected TV or watch Netflix from their mobile device.
CTV Advertising Is Cost-Effective
CTV is opening up the market even more, and agencies are exceeding their clients’ advertising goals. What this means for CTV advertisers is that cost of entry is significantly lower than when compared to linear TV.
Traditional TV spots have always been expensive, and before the onset of connected TV, advertising agencies had no choice but to bid for outrageously expensive ad slots on these channels. And your ad might end up showing at a time when your target audience is not watching. Connected TV, on the other hand, is more cost-effective in that it is less expensive and provides accurate targeting so that you’re sure your content reaches the right audience.
Connected TV advertising goes one step further by offering advertisers precise measurement and data attribution. CTV allows you to unlock data that would be inaccessible with linear television, thus opening up an avenue to see who views and interacts with your ads.
This data gives advertisers the added advantage of optimizing and retargeting their ads according to the information gathered. Armed with this new consumer data, advertisers can fully maximize the impact of every dollar spent on advertising. One of the greatest benefits of CTV advertising is the ability to track digital metrics, offline results, and digital completion rates.
High Adoption Rate
With well over half the population of the United States owning at least one connected device, it is safe to say that CTV is an almost universal phenomenon.
The rise of connected TV encouraged a generation of people who were tired of cable TV to switch to a service where they only pay for what they view. The term “cord-cutters” came to be, and these people haven’t looked back since then. Cord-cutting is gaining popularity mostly due to the control and flexibility internet-based content offers. Customers can watch what they want when they want, from wherever they want. With these positives in its favor, the popularity of CTV is only expected to keep on rising.
With so many customers spending time-consuming CTV content, it comes as no surprise that advertisers would take advantage of the many benefits and switch to advertising on the connected TV.
So, is connected TV worth all the hype? The connected TV growth is undeniable as CTV is fast taking over how the masses consume television, while traditional TV takes a back seat. The older generation who prefer to watch scheduled programs on traditional television is slowly being replaced by the cord-cutters, making connected TV one of the most lucrative investment fields right now.
Looking at the positives, it is clear to see that CTV offers benefits to both viewers and advertisers, and there are statistics to back up the claims. If there was ever a time to get into CTV advertising, now is as good as any.