What Is Connected TV Advertising?

Connected television (CTV) advertising is making its way to the forefront of effective marketing campaigns. Although people are using more devices than ever, it’s still possible to serve them cohesive ad campaigns across multiple channels. CTV could be the missing piece that helps you develop an effective and memorable omnichannel advertising strategy. With 90% of American adults using the internet in 2019, you don’t want to miss the chance to make connected TV a part of your marketing strategy. Here’s what you need to know about connected TV, including what it entails and how you can use this channel to increase your overall marketing success.

What Is CTV Advertising?

Before you learn about connected TV advertising, the first question you might be wondering is, “What is connected TV?” Connected television refers to TVs — and other devices — that can connect to the internet and host video content. Many of these programs are often outside of what cable providers usually offer. Viewers can access this content through apps. Devices with these capabilities include smart TVs, game consoles, and set-top boxes like Roku.

Connected TV advertising is a form of video advertising that reaches multiple platforms — TVs, computers, tablets and mobile devices. It is not limited to one device as linear TV advertising is, and you don’t need to purchase television inventory months in advance. Inventory refers to ad space in broadcast television, which determines what networks your commercials will be displayed on. Linear TV advertising requires you to buy a large amount of scheduled inventory for the coming season or year — known as an upfront. CTV is also a form of advanced TV, which is a broader term for marketing various strategies and platforms that allow you to reach TV viewers. Other kinds of advanced TV include:

  • Digital TV: Digital TV offers a major step up from analog programming. High-quality resolutions and smaller bandwidths are staples of this form of television — and so is internet connectivity. Streaming services and peer-to-peer networks allow people to access more TV content through computers and smartphones.
  • Addressable TV: Addressable TV marketing enables you to personalize your ads based on household characteristics. People see video content that aligns with their media consumption habits, based on the internet-connected devices they use. You can even target ads to individual household members, which would be influenced by what they interact with on specific electronics.
  • Programmatic TV: This marketing strategy allows you to host your video content across multiple CTV platforms. You can track metrics for your ad campaigns, select from unique inventory options, and foster brand interest by effectively retargeting viewers.

These solutions help companies get their content in front of the most relevant leads without relying on traditional TV advertising methods. Over 41 million people in the United States are predicted to become cord-cutters by 2021. Connected TV ads have become especially relevant in helping businesses maintain their ad campaigns without losing viewers who have given up cable. Although some would argue TV advertising is fading in its effectiveness, this might be more true for traditional TV. Connected TV, however, grows with each year, with 59.1% of the population currently onboard.

What Is the Difference Between OTT and Connected TV?

Over-the-top (OTT) refers to platforms like Netflix and Hulu that serve traditional TV content over a closed streaming system. Viewers can access their favorite shows and movies whenever they want without subscribing to a cable provider. Connected TV typically refers to the kinds of devices used to access OTT programs, with a higher emphasis on television sets. Many people think of these terms as interchangeable, though they’re slightly different. CTV is more accurately described as a subset of OTT. In the debate about connected TV versus OTT, both offer effective channels for video advertising. If you’re working with one, you’re likely working with the other, too.

Targeting With CTV

When you target viewers with CTV marketing, you can define relevant audience segments and bid on television inventory across a range of networks. This technique allows you to position your brand alongside premium video content — like popular shows and movies — for optimal engagement. You can bid on inventory using programmatic methods like retargeting and contextual targeting. Because the bidding is automated, you’ll spread your ads to a larger audience in a quicker time. Use first- and third-party data to reach viewers at a household level and construct a more accurate idea of your audience. Large amounts of third-party data combined with first-party information can help you draw a clear picture of who you’re advertising to. In turn, you reduce the number of wasted impressions while strengthening your brand name.

Of course, it’s always essential to prioritize data privacy when handling consumer info — accuracy shouldn’t come at the expense of security. Frequency capping can also assist with saving money and preventing fatigue by limiting how many ads people receive. Individuals will be more receptive to your brand if you set targeting parameters to avoid sending ads to them too often or on too many platforms. These conditions might include aspects like time of day, geographical location, and the type of devices targeted. Once you identify your viewership, you can begin running ads and retargeting those already familiar with you. CTV retargeting combines well with other programmatic advertising channels, including:

Popular CTV Platforms

It’s essential to know some of the best platforms for CTV marketing when starting an ad campaign based on this strategy. Your preferred channels will be determined by a few different variables. Do their viewership’s demographics align with your audience segments? Is your brand messaging typical of the content viewers would expect to see from that platform? As you unearth the answers to those questions, here are a few popular platforms for hosting connected TV ads:

  • Tubi
  • Amazon
  • Vevo
  • Viki
  • Pluto TV
  • Crackle

Benefits of Connected TV Advertising

When you weigh traditional TV advertising against CTV platforms, numerous benefits emerge for the latter strategy. Whether it’s reduced advertisement lead time or higher customer engagement, you’re likely to see significant gains with this method. Here are some of the advantages you can reap from incorporating CTV into your marketing campaign:

  • Additional targeting: By spreading your influence across multiple channels, you adopt an omnichannel marketing strategy and reach more viewers. You can take advantage of targeting methods you may not have had access to before while avoiding overwhelming viewers with repetitive marketing. The more often your business appears in front of consumers, the more likely they are to remember who you are.
  • Tracking capabilities: CTV advertising allows you to track who sees your ads and engages with your business afterward. You don’t have to remain in the dark about how well your campaign is working when you have real-time metrics. If you notice adjustments are necessary, you can do so quickly and easily thanks to internet-capable CTV tracking.
  • No upfront buys or minimum commitments: Upfront buys require you to purchase inventory before knowing whether your content will be successful with your leads. This strategy can be inefficient for managing marketing expenses and optimizing ads for consumer preferences. In contrast, CTV requires no upfront, and you don’t need to make any minimum commitments to get your content on-air.
  • High video completion rate: Because CTV ads are unskippable, this form of marketing tends to yield a higher video completion rate (VCR) than other types of video advertising. Marketers who use this strategy see over 90% VCRs across their content. High VCRs mean more eyes on your business and more potential conversions from people who research you.
  • Programmatic purchasing available for cost efficiencies: As a subset of programmatic marketing, CTV advertising shares many of the same cost-effective advantages. It can often be cheaper to use this automated method rather than going to individual publishers to seek platforms. Additionally, you can adjust CTV buys in real-time by employing a trading desk like AUDIENCEX.

How Does Connected TV Advertising Work?

Connected TV targeting occurs within a private marketplace (PMP). These auctions sit a level above open exchange auctioning, allowing publishers to decide what kinds of video advertisements and which brands they will host on their platforms. A wider range of creative formats — like video and audio — is available for publishers using a PMP. These auctions are invite-only, though their exclusiveness is why they guarantee higher success. Striking a CTV PMP deal can substantially boost your company.

Effective strategies for using connected TV ads involve concepts such as first-party data, third-party data, and cross-device targeting. The types of inventory you employ may include desktop and mobile video along with your CTV commercials. If you have existing audience segments from your mobile and desktop efforts, you can retarget them through digital television commercials. Combine connected TV advertising with online display ads to construct a full-funnel sales journey for your consumers. Connected TV ads come in the form of pre-roll and mid-roll advertising. Although these methods may sound self-explanatory, it’s helpful to go more in-depth with what each one entails. That way, you can decide which one embodies the most suitable characteristics for your business. Here’s how they work.

Pre-Roll Advertising

Pre-roll ads appear before the video content starts, which can be less intrusive than mid-roll commercials. “Pre-roll” often refers to the commercials you see before your selected programming, although some platforms also offer inventory outside of this. Many Samsung smart TVs, for example, host display ads on their home screens. Users see these before they pick their show and start watching. This avenue could be another potential winner for marketers seeking new tactics. A spot on the home screen combined with a mid-roll advertisement could serve well in spreading your brand name.

Mid-Roll Advertising

Mid-roll ads show up in the middle of a program. The fact that they interrupt the viewer’s content doesn’t take away from their effectiveness, however. Their short run times facilitate a more comfortable viewing experience in contrast to longer linear TV ads. Plus, many viewers are already familiar with encountering this advertising format when watching TV — in the form of commercials. This factor may make them less likely to object to ads on during a connected TV experience, especially if they’re shorter.

Which DSPs Can You Run CTV Advertising Through?

You may be asking, “Which DSPs can I run CTV advertising campaigns through?”. There are numerous DSPs you can choose from, including:

  • The Trade Desk
  • Amazon
  • MediaMath
  • Adobe
  • Roku
  • StackAdapt

Connected TV FAQs

If you need more guidance on CTV advertising and what it means for your campaign, you can easily find the answers to your inquiries. Here are some of the most commonly asked questions concerning CTV and how it works.

What Are the Most Popular CTV Platforms?

In addition to the previously-mentioned popular CTV networks, it’s also helpful to know which devices people are using to view connected television. According to 2018 research from Nielsen, people across the U.S. spent 8 billion hours a month watching content on connected TV devices. These include Roku, Amazon FireTV Stick, and Apple TV. Other devices you may decide to include in your campaign could be Chromecast, Android TV, and PlayStation.

What Are the KPIs for CTV Advertising?

The key performance indicators (KPIs) for CTV advertising include metrics like video completion rate, cost per completed view (CPCV), and brand awareness. Since click-through rates are not a KPI you can track with television advertising, these CTV-based metrics will serve as your primary data sources. VCRs tell you how many people watched the entirety of your commercial. Remember — longer and more frequent exposure leads to higher memorability. Your ad campaign’s CPCV may matter more to your brand than the cost per mille (CPM), which is discussed in more detail below. Although you may achieve 1,000 views on a commercial, that doesn’t mean they’re all viewable impressions or unique views.

What Is the Average CPM for CTV?

CPM is an aspect of digital marketing that entails how much you pay for every 1,000 impressions of your content. CTV can be more expensive than video advertising for mobile or desktop when it comes to CPM. According to eMarketer, advertisers spent anywhere from $20 to $28 on in-stream CTV ads throughout 2017 and 2018. However, it’s worth noting that these expenses largely depend on which publisher or platform you’re dealing with. Your business market and individual campaign also contribute when dictating prices. Additionally, the VCRs you achieve with connected TV lead to high-quality impressions that can make up for these initially higher prices. CPMs may also decrease due to a greater supply of CTV platforms.

What Type of Targeting Options Are There for CTV?

Connected television offers options such as retargeting, lookalike modeling, contextual targeting, geolocation, and behavioral targeting. These choices are far more numerous than what you’d usually have for traditional TV advertising. Many of them are the same tactics used for internet marketing, which speaks to how intertwined the two forms can become with the right tools.

Contact AUDIENCEX for Connected TV Advertising

Beginning the journey to successful CTV advertising is straightforward and hassle-free with the right partners. AUDIENCEX can help you prosper with this marketing method by offering access to enterprise-level networks, platforms, and broadcasters — as well as demand-side platforms (DSPs). Refine your TV advertising techniques without the stress of upfront buys or uncertain metric tracking. With our commitment to high-quality marketing and dynamic collaboration, we ensure personalized and effective CTV campaigns for all our clients. Connect with AUDIENCEX today to drive your impressions up and experience marketing to the power of X.

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