CTV ad spending is the fastest-growing segment in local digital advertising. BIA Advisory Services predicts it will reach $2.4 billion in 2023 and $2.9 billion in 2024. While its growth has been on an upward trajectory, premium inventory is plentiful, with more streamers adding ad-supported tiers and an increase in FAST (free ad-supported streaming television) channels. These facts, however, don’t mean you’re free of objections from advertisers. There are several ways to overcome these, and understanding CTV trends can help.
To prepare you to win more of these dollars, let’s look at trends and how to interpret them for your customers.
Streamers Are OK with Ad-Supported Subscriptions
While FAST channels are always ad supported, streamers have tiers, including Netflix. The company added this subscription type to grow its usership, and it has worked well. Others have also benefited from this as consumers have racked up subscriptions. Almost one-third of new subscribers choose ad-supported options, and 59% of consumers are willing to watch ads.
This means more eyes are on the screen as streaming becomes more like traditional TV. The big difference is, of course, that these ads aren’t skippable.
Relaying these facts to advertisers demonstrates the opportunity to reach local audiences in a targeted way.
Advertisers Appreciate Advanced Targeting
One of CTV’s biggest selling points is its targeting capabilities. Advertisers recognize this value and how it complements traditional TV buys as well as other digital tactics. CTV enables a more customized message to specific people, which is an excellent supplement to the reach of linear TV. Targeting options include:
- Behaviors and interests
- ZIP codes
- DMA (designated market area)
- Household demographics
Relevancy in ad viewing matters significantly. When people watch ads that speak to their needs, they are more likely to engage with and remember them. For example, a local HVAC company wants to target homeowners with a specific household income who live within a specific DMA. CTV targeting allows them to reach that segment rather than just anyone within their city.
Shoppable Ads Create Conversion Opportunities
The big difference between CTV and OTT ads is where they play. CTV ads run on smart TVs or via devices like Roku or Fire TV Sticks. OTT describes those on mobile devices. So, an OTT ad can have a button to click for the user to learn more or make a purchase on their phone.
The new CTV trend to ensure the opportunity for conversions is to make ads shoppable. Incorporating direct purchasing capabilities can be a big sales booster for your advertisers. The easiest way to do this is with QR codes. Integration of these into the ad provides an instant way for people to learn more. After the scan, they’ll land directly on a purchase page. Advertisers will get more traffic if they include a special promo just for these viewers.
Making a CTV ad shoppable can also be as simple as including a memorable URL with an offer. How will viewers remember it? They are already watching with a phone in hand, with 87% of TV viewers doing so, and 65% of them use their secondary device to search for information and visit an advertiser’s website.
Since these ads target the most likely audience to need products or services, advertisers could see big returns from adding these features.
CTV Is a Key Component of Omnichannel Campaigns
High-performing ad campaigns use multiple tactics; CTV is a nice fit for this mix. As noted, it’s a great accompaniment to linear TV. It also works well in an ad mix with other digital options. A study found that a big appeal of CTV is that it works seamlessly in omnichannel campaigns. They ranked it as a good option to support social media, display, video, linear TV and audio.
CTV or OTT are not something you’d sell alone. It’s part of an integrated campaign that amplifies all the other ad tactics. They work cohesively to get consumers’ attention and nudge them down the sales funnel.
CTV Helps Advertisers Reach Specific Demographics
CTV’s targeting options include household demographics, but it’s not a perfect art. However, if you look at viewing patterns for audiences your customers want to reach, it’s a fit for Hispanic and Asian viewers. Data from Nielsen revealed some interesting information about these consumers.
- Asian audiences are moving to CTV at a faster rate, with a 3% share of screen time among the most-watched streaming titles in 2022. When they view ads that are inclusive, they are 46% more likely than the total population to buy from these brands.
- Streaming comprises 43% of Hispanics’ total TV viewing, compared to 35% for the general population. They watch ad-supported platforms and FAST channels. They also gravitate toward inclusive content, with 49% stating they’d be more likely to become customers of those companies.
Leverage CTV Trends to Make It More Attractive to Local Advertisers
These CTV trends can be great conversation starters with customers. The tactic has tremendous value and can yield great ROAS (return on ad spend). It’s also a great local vehicle to get in front of your advertisers’ desired audience. You may still get pushback about creating the content for the ad, but there are answers for that too! Read our post on how to overcome objections to learn more.