For years, CTV and linear television have been battling for viewership numbers. And CTV seems to be coming out on top. Consumers are looking for more flexibility and lower costs cut cords en masseresulting in CTV audience linear superlative.
with ~230 million For US users only, CTV offers a clear opportunity for advertisers to reach new audiences. But viewership numbers aren’t the only draw. With a variety of results-focused capabilities, CTV has turned TV screens into powerful performance advertising engines that today’s brands cannot do without.
CTV continues to grow in popularity among viewers, and streaming services are shrewdly catering to those customers. But there’s another group of consumers they need to keep happy: advertisers. As ad-supported content offerings grow, CTV’s streaming services and other advertising platforms are developing more sophisticated technologies to meet the needs of advertisers. And while it may not be immediately apparent, these technological advances are also leading to a better experience for viewers.
Television has become a powerful performance channel
Advertisers used television primarily as an awareness game. This is because viewers used to constantly tune in to their favorite newscast, weekly sitcom or sportscast, offering the ability to reach millions of eyeballs with a single ad. But at the same time, this channel was inaccessible to many brands: advertising costs were high, and determining when (and even if) an ad would run was difficult, if not downright impossible.
CTV changed that, opening the doors to businesses for whom television advertising had previously been a dream. By providing brands with precise audience segmentation, comprehensive reporting, and the flexibility to change ad creative when needed (among other benefits), CTV has transformed television into a performing advertising channel similar to social media and search . And many advertisers are already using it this way.
Studies revealed that while 81% of sellers said they use CTV to increase brand awareness, two-thirds rank it as a performance marketing channel. In addition, many brands use CTV to drive specific results: more than half of respondents said they use the channel specifically to drive measurable web visits, conversions and revenue.
Brands may be using CTV as a performance channel, but some broadcast heavyweights haven’t fallen short when it comes to user and advertiser experience. Netflix suffered when it failed to deliver on advertising guarantees made when it launched its ad support tier in late 2022. A year later, Netflix is still working to improve advertiser experiences. And they are not alone on this front.
CTV adtech is evolving to meet the needs of advertisers
On November 1, 2023, Netflix announced a bunch of new features to better meet the needs of advertisers. Starting in Q1 2024, brands advertising on Netflix can use the following:
Binge Ads: An ad format that allows viewers to watch a fourth ad-free episode after watching three consecutive ad-supported episodes.
QR codes: Advertisers can include QR codes in their creative to encourage viewer engagement.
Sponsorships: Now available to advertisers in the US, Netflix sponsorships are divided into three categories: title, moment and live. Sponsorships allow advertisers to be part of major content launches (i.e. “titles”), seasonal moments and specific live events.
Refined Measure: Netflix will partner with third-party providers to expand advertisers’ measurement capabilities and enable campaign verification.
Netflix isn’t the only one working on this. supreme has also recently updated its advertising platform. Its new Conduit product, which aggregates Paramount+ and Pluto TV inventory, was created to solve problems associated with Fragmentation of CTVsuch as separating rival brands into ad units and tracking precisely how often ads run.
“The undercurrent here is that there’s a lot of programmatic technology and these platforms don’t always play very well together, and we feel that as a publisher the buck stops with us to deliver a high-quality ad experience,” he said. Leo O’ Connor, senior vice president of publicity for Paramount, of the update. “If a viewer has a bad commercial break while watching one of our shows, they don’t get upset with the ad server. They don’t get upset with the TV manufacturer.”
MNTN has also revamped its acquisition technology. MNTN Next Gen TV was developed to help advertisers and their teams transform TV into an even more powerful engine of growth. Some of the major updates include improved audience creation, verified measurement, and optimized creative. Performance optimization also received an overhaul; its dedicated product and engineering teams have enhanced MNTN’s performance engine to deliver unmatched return on investment. With MNTN Next Gen TV, advertisers are already earning, on average, 27% more cost per acquisition and 38% more site traffic.
Viewer experiences with real-time ads can be inconsistent
Paramount’s O’Connor isn’t wrong in assuming that bad ad breaks can reflect poorly on the streaming services that offer them. And in the early days of ad-supported streaming tiers, the user experience has been inconsistent at best.
Alyssa Boyleassociate editor at AdExchanger, talked about it firsthand when she reviewed Disney+’s new ad-supported tier in February 2023.
“Whether I was watching ‘Hannah Montana’ or the National Geographic show ‘Airport Security’ about cocaine smuggling, the advertising experience was pretty much the same,” Boyle said.
He also noted that repeat ads and those from rival brands were not uncommon.
“I saw repeated commercials for Capital One and a college in southern New Hampshire, as well as commercials for Huggies and Pampers in back-to-back episodes of ‘The Simpsons.’
But a better ad viewing experience could be on the way. By supporting the needs of advertisers, these ad technology upgrades could in turn address (if not solve) the needs of viewers. For example, enhanced audience building will help advertisers be more precise about who they serve ads to, ensuring they’re consistently targeting viewers who are interested in their product and/or who could benefit from it. For viewers, this means more ads that are truly relevant to their interests and needs, and fewer that aren’t.
The evolution of CTV adtech could bode well for both advertisers and viewers
The steady increase in ad-supported streaming content combined with CTV’s performance capabilities should be reason enough for advertisers to invest in the channel. If not, CTV’s recent adtech updates are helping solidify the argument. Increasingly sophisticated ad technologies will enable advertisers to produce superior performance results and realize the full potential of CTV, but can also provide a better viewing experience, a win for both advertisers and CTV users.
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