Connected TV Ads (CTV): What Is It & How It Works
As television audiences make the switch from linear to streaming, TV advertising has had to evolve with the changing technological landscape. One such foray into the future of television has been connected TV alongside connected TV ads. Nowadays, most modern television sets are connected to the internet, bringing yet another household device into the cloud and allowing us to enjoy our favourite shows on platforms like ITV Hub and Sky On Demand.
But what exactly is connected TV advertising all about? Why should companies and brands be aware of this marketing channel? In this article, we talk about everything you need to know about what connected TV is, how it works and the benefits it brings to advertisers who utilise it.
What is Connected TV advertising?
Advertisements that are broadcast on televisions that can also link to the internet are referred to as “connected TV” (CTV) advertising. There are two ways in which TVs can connect to the internet: either through a direct connection with the internet, as with smart TVs, or by using an external media player, also known as over-the-top (OTT) devices, such as Roku, Amazon Fire or Google Chromecast.
CTV is defined by the large TV screen that allows advertisers to engage audiences in a linear TV-like environment, a one-to-many relationship enabled by co-viewing, and higher engagement because of the screen size. This is in contrast to other forms of digital advertising, which typically concentrate on a one-on-one relationship between the content and the user.
How does CTV work?
CTV enables marketers to communicate with their target audience through connected TVs and OTT devices. It’s a great approach to get your brand name out there and get your goods and services in front of more of your ideal customer so that you can increase your sales and profits. Just how does CTV advertising function work, though?
As we’ve mentioned earlier, CTV advertising allows you to reach consumers while they are consuming their favourite content on services like Hulu, YouTube and Disney+. Advertise your business on these widely used streaming services and platforms, and your ads will be seen by the people who are most likely to buy from you according to the platforms’ respective audience targeting tools.
Since CTV ads work more like online marketing channels instead of traditional TV, they also function slightly differently. For one, CTV advertisements are a lot more targetable thanks to the rich data that is available from these platforms.
Overall, the key to successful CTV advertising is picking the right medium to spread the word about your products or services. After that, you get to choose between several forms of advertising, such as video or display ads, for your campaign.
Then, you may direct your marketing efforts toward the right people by making use of the sophisticated audience targeting options provided by these platforms. Finally, the success of your CTV advertising campaign may be measured and analysed to help you refine and perfect your approach.
Advantages of using CTV advertising
The rise of CTV and the advent of OTT media providers present a wealth of opportunities to enhance your company’s advertising and operations. Consider the following brief summary of the positive effects that CTV advertising can have on a company’s marketing efforts:
Cost-effective
Independent advertising agencies can benefit from CTV’s potential for rapid growth by meeting or exceeding their clients’ advertising objectives. Traditional marketing channels can be difficult to enter because of their high entrance costs. However, this is one of the biggest benefits of linked TV advertising. By highlighting this benefit to customers, creative TV ad agencies can establish themselves as valuable strategic partners.
Advertisers who wish to broadcast their ads on traditional television have to pay a hefty sum for a spot that, ultimately, is at the discretion of the network. It’s because commercials can only air during specific times on various networks. Even if your commercial makes it onto TV, it can air when none of your ideal customers are watching. This makes linear advertising quite costly, especially for smaller and medium-sized businesses. And it’s spent on an ad that your demographic may not even see.
The internet, sophisticated targeting, and granular inventory selection all contribute to CTV advertising’s lower cost. You may increase the quality of your audience by targeting ads at people who might otherwise be difficult to reach. It’s a great way to integrate your campaign with other online and offline behaviours, increasing ad relevancy to match customer preferences.
Targetable
In many cases, advertisers use detailed user personas in their campaigns. The challenge of reaching males between the ages of 20 and 35 who are interested in sports is daunting. A large chunk of the advertising money may be spent on a prime-time 20-second TV spot, or it could be divided to reach the target population point-wise and programmatically, individually for each viewer, independent of location or time of day.
Like other programmatic media buys — such as display, native, and audio — CTV makes use of streamlined campaign setup and pinpointed targeting. So, much like other programmatic programmes, you can measure how well it’s doing in relation to your goals and metrics even while it’s live. CTV commercials utilise streaming data, allowing for cross-platform user tracking. Advertisers can follow a potential consumer throughout the internet once they’ve seen your ad on their Smart TV.
When companies advertise on TV using CTV targeting measures, they gain access to several additional advantages. Targeting the right people with remarketing advertisements can generate a tonne of new customers for your company.
Measurable
Along with accurate targeting, CTV also provides more precise measurement and attribution, which is another way in which it differentiates itself further from linear television. You are given the ability to unlock data through the use of CTV, which is a significant improvement over the benefits of advertising on television. You have the ability to take the initiative to learn who is interacting with and viewing your advertisements. After that, you can optimise and retarget your efforts in accordance with the new information you have. Retargeting people based on their impressions or participation with other ads is another option available to you when using CTV.
Utilising the full potential of audience targeting on CTV presents a wealth of opportunities for optimisation. If you have access to a more in-depth degree of client data, you will have the ability to make the most of the impact that your advertising budgets have. In comparison to linear TV advertising, this is one of the most significant advantages of connected TV advertising.
When using standard TV commercials, you have to wait for performance data for weeks and often even months. Once your advertisement has run its course, it is too late to make any improvements, whether they be revisions to the targeting or other campaign optimisations . Viewing numbers and making adjustments on the go are both possible with CTV, thanks to its real-time targeting and reporting capabilities.
Advertisers on CTV are able to measure the success of their campaigns not only in terms of offline behaviour but also in terms of website visits and online purchases. The ability to track the impact of your CTV campaigns with digital metrics, such as video completion rates, and offline results, such as an increase in footfall traffic or in-store sales, is one of the great benefits of CTV advertising. Another one of the great benefits of CTV advertising is the ability to track the impact of your CTV campaigns with traditional metrics.
Metrics measured on CTV
It is possible to deduce viewing habits and preferences based on data collected on specific programmes and genres via CTV advertising, which opens up new potential for optimisation as well as audience understanding and targeting.
The standard measurements that any CTV video partner will typically supply will typically encompass a wide range of reporting parameters as well as viewing dimensions.
Reporting metrics:
- Impressions
- CPM
- Video completions
- Frequency
- Total reach
- Unique (household de-duplicated) reach
Viewing dimensions:
- Platform
- Program
- Viewing device
- Time of viewing
- Type of viewer (eg. light, medium, or heavy viewer based on daily viewing habits)
Advertisers have the ability to maximise their effectiveness across inventory, audiences, placements, and creativity when using CTV campaign flights. Advertisers will often optimise toward and set CTV KPIs based on the following. However, this will vary depending on the goal of the campaign, such as:
- Video completion rate
- Cost per view
- Cost per thousand
- Cost per action (when calls to action are utilised)
Final thoughts on Connected TV ads
CTV is gaining popularity among advertisers as a result of the several advantages it possesses in this day and age of digital technology. To begin, an increasing number of people are moving to this technique in order to watch television. In addition to its fast-growing audience, it possesses excellent pricing structures, opportunities for customisation, and the capacity to accurately target particular groups.
But the best of all? In the future, marketers will have access to a centralised hub that will allow them to track, measure, and attribute the performance of all of their promotional campaigns. Through the use of connected TV advertising, businesses are able to monitor the ways in which all of their digital channels are collaborating to ensure the success of their omnichannel advertising strategy.
Keen on seeing what TV advertising can bring to your brand? Get in touch with an experienced advertising agency who’ll be able to help you get the job done!