In this article we are going to discuss global shifts in the Connected, or Smart, TV (CTV) landscape. We will get into the detail on how advertisers can better reach people as they consume their favorite films and shows on the many and varied platforms that make up the CTV landscape. Because of that, there’s going to be a bit of jargon and a fair few abbreviations and acronyms. So, at the bottom of this article, we’ve created a handy glossary for those who might not be as deeply immersed in digital planning as our brilliant author is.
Connected TV (CTV) or Smart TV has been part of our media landscape for several years, but the COVID-19 pandemic significantly altered consumer behavior. As global lockdowns took effect, CTV consumption surged, leading to increased viewership and longer session times. Post pandemic, many media behaviors, like online learning and gaming, reverted as people started stepping outside. However, CTV remained strong, with trends showing increasing consumption and device penetration, as well as growing brand investments.
A report from Wurl, analyzing US CTV viewing from 2020 to 2024, shows that CTV engagement is reaching new heights.With a broad range of channels and content, consumers have more options, and average viewing time is increasing. In Europe, CTV growth is notable, with 55% of UK respondents and 49% in mainland Europe subscribing to additional streaming services in the past year, according to another study from IAB and Double Verify.
This trend offers brands more opportunities to reach audiences on the largest screen in the house. Combined with contextual and geo-targeting capabilities, CTV provides an efficient and effective advertising platform. Studies show that integrating CTV into media mixes enhances campaign performance and lowers CPAs when combined with channels like Mobile, Affiliates, and SEM. Thus, CTV not only drives brand awareness but also aids in conversions.
The Wurl report highlights that ad loads (ad minutes per hour of programming), and ad fills (percentage of ad inventory used by advertisers) remain slightly low in 2024 due to higher supply availability. Ad load impacts viewer experience, so brands must avoid high ad frequency that disrupts content and have more contextual relevance with the programming. Dentsu’s Consumer Vision 2035 report states that 70% of global consumers say their weekly shopping decisions are influenced by their mood at the time of purchase, hence appealing to the mood of the viewers is crucial when advertising on CTV.
Ad fill rates are cyclical and seasonal, with peaks in months like December during holidays. Media agencies must help clients select the best buys and plan campaigns for optimal results and ROI.
For brands, this indicates CTV should be part of the media mix to reach the masses at scale while maintaining contextual connections through strategic targeting. The challenge lies in understanding the right placement and entry point (OTT, VOD, Addressable TV), each with its own pros and cons. Brands should avoid overinvesting in a single strategy and spread their efforts to ensure visibility in front of the right audience. Improving ad experience by matching content and context to viewer mood can result in higher attention and positive brand perception. Incorporating elements like QR codes and cross-device targeting can create seamless purchase journeys.
At Carat, we strive to connect brands with the people who matter. We believe media can deliver the ultimate experience and use a three-pillar approach: Addressability, Accountability, and Adaptability.
Still most transactions are structured as PMP/Direct deals vs. programmatic in CTV, as per IAB Europe. Programmatic CPMs are still lower vs. direct buys and overall we are not seeing the CPMs declining in trend, so the increasing momentum to programmatic buying is offsetting the supply availability. This is where, leveraging our extensive network of CTV partners and Carat expertise, we can help clients take data + opportunity driven decisions and reach their right audiences. CTV landscape is innovating at speed, and we ensure that our clients are always at the forefront by empowering them with insights and tools.
The source for this article was originally reported in The Media futures Newsletter – Five Media News Stories published by Dan Calladine every Monday. To subscribe, click the link.
Glossary of terms
Addressable TV: Targeted/contextual ads across Linear TV (cable/satellite enabled)
CPA: Cost per Acquisition (amount spent to acquire one customer/user)
CPMs: Cost per ‘000 Impressions (cost to deliver 1000 ad placement impressions)
CTV: Connected TV / Smart TV (with Internet connectivity)
OTT: Over the Top (content streamed via internet)
PMP/Direct Deal: Private Marketplace (buying ad inventory directly with media owners)
ROI: Return on Investment (amount of revenue earned per ad spend)
SEM: Search Engine Marketing (ads on search engines like Google, Bing, etc.)
VOD: Video on Demand (content available on demand, anytime/anywhere)
