What is connected TV, what marketers should know, and how its expanding profile is affecting analytics strategy.
Video has generated a lot of interest among both marketers and consumers, with increased adoption during the COVID-19 pandemic. Different types of videos have been forming for a while: short format, long format and live streaming.
But it wasn’t until the stay-at-home environment that encouraged consumers around the world to embrace live video, pushing its content as a medium to include in a modern strategy.
This has raised the profile of connected television (CTV) as a marketing touchpoint for marketers. Connected TV has been around for a long time. Now marketers need to change their strategy to include this. This also affects an overall analysis strategy.
Basic concepts of CTV
Marketers often hear about live video as an engagement opportunity. But CTV’s programming offers a dramatic contrast in engagement with live video. To find out, we need to look at live streaming and then consider the basics of what connected TV is and how its expanded profile is affecting analytics strategy.
Live video is a visual stream in real time, making it an attractive format for events, influential creators with flexible schedules, and series programming with short “seasons.” Many short videos like YouTube Shorts and TikTok are streamed live, as well as live video events hosted on YouTube.
In contrast, connected television (CTV) may contain some live events, but it is mainly more structured broadcasts: programs and series scripted to fit traditional television formats. Connected TV programming is delivered via a device connected to a TV or built into the TV features to display streaming video content. The current platforms showing CTV programming are the ones you often watch or listen to: Amazon, Prime Video, Roku, Hulu and others. Apple TV and Amazon Firestick are examples of CTV devices. Even PlayStation and Xbox are considered CTV devices as they are gaming consoles with streaming capabilities.
Related article: How IoT, Automotive and SmartTV are changing the digital customer experience
CTV is #1 in video advertising
CTV grew out of consumers adopting streaming video into their viewing habits. The COVID-19 pandemic accelerated this transition. People who had restricted their activities to plans at home due to the pandemic have included on-demand programming and live events alongside mainstream television. CTV is now #1 in video advertising, representing the most impressions served across all devices for 17 consecutive quarters, according to the latest research from Extreme Reach (ER). as reported in Martech Series.
CTV metrics are gaining importance as CTV options begin to influence US digital ad budgets, according to eMarketer, which also noted how viewership has increased, narrowing the ad spend gap between linear TV ( traditional television as viewers have come to know) and CTV. They noted that the gap “is closing rapidly…. By 2025, eMarketer Forecasts “That CTV’s ad revenue will be more than half that of linear TV.”
The shift is an opportunity for marketers and media buyers to refine their CTV budgets into performance marketing channels to connect with audiences and drive ROI.
The battle against search and social media for home rule
CTV has emerged as a competing channel against search and social media as a major referral source for online activity. CTV-enabled televisions are often the largest screen in the home, encouraging homeowners to look for goods and services to purchase within their television viewing experience. For example, Roku struck a deal with Walmart to offer customers the ability to shop in-stream with Walmart acting as fulfillment for those purchases.
YouTube is the biggest competitor in the current crop of connected TV platform providers. It offers its own live streams with the ability to display digital ads to a wide range of advertisers. Along with its stature as a major search engine, YouTube has an advantage for brands that have already invested heavily in search engine optimization that includes YouTube video content.
In addition, YouTube has begun to take advantage of social commerce. Social commerce is meant to provide a retail experience within a platform rather than being driven to a specific website. Shoppers can learn about a product on screen, see a call to action, and click on an ad through the YouTube app.
Shopping convenience has been central to recent updates to the platform’s social media profile and features. For example, Twitter just launched a business profile where followers can buy products and services on the profile.
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This has made CTV a competitive performance channel compared to a reference source in analytics. In previous trends, people would have looked at a website while watching TV. This led to shopping behaviors such as shopping online pick up in store (BOPIS) and shopping online return in store (BORIS). CTV traffic flow combines retail. Today they are as likely to use a CTV. In simple terms, it means that CTV is competing against social media and online search for people’s attention.
Related article: Social commerce is here
The impact on Analytics
To date, half of the US population has switched cable to CTV. Advertisers have adjusted to declining interest in linear TV, shifting budgets accordingly.
This means there is a greater need for analytics tagging that enables cohort analysis and other advanced predictive analytics possible so you can match real-time metrics to streaming devices.
With linear TV, you target the home, but with limited reach. CTV provides additional guidance such as purchases by income, number of cars in the household and frequency of purchase.
CTV analytics measurement reflects the metrics marketers are most familiar with. The CTV measurement has focused on the optimization of the range frequency. Reach frequency metrics include average campaign impressions, average campaign frequency, and unique reach, which represents the dedicated number of households watching CTV programming.
Audience targeting opportunities at CTV
CTV influences analytics strategy through media choices aimed at potentially reaching generational customers within a household. The majority of CTV viewers are young, but many studies suggest that older viewers are also a substantial cohort among CTV viewers.
This suggests that although people vary by age, CTV can reach all cohorts with advertising messages. This is particularly useful when cohorts can be reached in the same household. There are many multigenerational households in the US today for a variety of personal reasons, ranging from younger people priced out of the housing market to people who have included older family members to care for.
Regardless of the reason, the existence of a multi-generational household gives brands looking to connect with different people the convenience of connecting. Mixed cohorts also quickly introduce complexity if they need to be convinced of a brand’s value. Thus, converting audiences into customers becomes a complicated messaging application. As with other attribution issues, marketers will dig deeper to understand the issues of matching messages to audiences.
Marketers will also become familiar with the powerful influence CTV has on their brands. CTV is here to stay, so marketers will need to keep an eye on how analytics captures this factor in the customer experience.
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