4 CTV Advertising Sure Bets for 2023
Author: John Vilade, Head of Sales, Premion.
Amidst signals of a recession and a general pullback of advertising spending, the state of Connected TV (CTV) advertising is healthy, resilient and the growth accelerator of media right now. While advertisers are bracing for an unpredictable 2023, they’re focused on making their ad dollars work smarter and harder and prioritizing the CTV channel, which will further propel the ad-supported streaming boom and usher in a period of even greater comfort and reliance for marketers with CTV.
In fact, while consensus growth indicators have the ad market at only +5% annual growth rate, CTV ad spending is projected to grow nearly 3 times that rate at 14.4% in 2023, according to a new IAB 2023 Outlook Survey. Moreover, across all advertising channels, digital video, inclusive of CTV, is poised to capture the biggest share of total spend in 2023. The IAB’s forecast also finds that acquiring new customers (61%), brand equity (43%) and improving media efficiency (35%) are top goals for media investment in 2023 — all attributes that make CTV extremely compelling.
In the year ahead, marketers will be under increased budget scrutiny and thus will put a greater emphasis on performance-based media plans and measurability — with a large plurality of advertisers already embracing the data-driven capabilities of CTV for both brand awareness and trackable, outcome-based marketing goals. Dollars simply must work harder.
Here are my four predictions for CTV advertising growth and usage in 2023:
Heightened Brand Safety Focus to Drive More Ad Dollars to CTV: The recent brand safety concerns on Twitter will continue to give advertisers pause on investing more on social media platforms — and we can expect more media investment to flow to CTV. That said, not all CTV content is equal. To protect brand reputation and ensure that ads are running in brand-safe, fraud-free content, advertisers should look for the TAG Brand Safety and Certified Against Fraud Seals of approval to ensure they’re working with a providers that operate to a set of rigorous guiding brand safety and invalid traffic (IVT) fighting principles. This is the best safeguard for transparent accountability and brand safety protection.
Accelerated Usage of CTV Brand Lift Studies: Beyond looking at reach and frequency as primary success metrics, advertisers are tying CTV viewership to direct business results — by matching exposure to CTV ads with sales generated by a streaming TV campaign. Additionally, marketers can go deeper to understand the true impact of their CTV campaigns on viewer perceptions with brand lift studies, such as which messaging is resonating best with which audience.
We expect more marketers to conduct CTV brand lift studies as many are already seeing positive results with ad recall, favorability, brand awareness and purchase intent. For example, advertisers can gain insights on whether their messaging is working, and they can learn about their audiences and how they perceive their brand so they can optimize their targeting or creative. For instance, a brand can learn which ad creative is driving the most impact, or they may uncover that their campaign is resonating more with Gen Zs than Millennials, or within a specific geography. Brand lift metrics aren’t used enough in CTV, but are about to get more deserved limelight in 2023.
Mainstreaming of Persona-based CTV Targeting : Advertisers are already tapping into a broader array of CTV targeting capabilities beyond just location, interests and behaviors. They’re tailoring targeting strategies aligned to precise brand goals — from driving brand awareness with demographic or contextual targeting to reaching in-market shoppers with intender targeting.
In 2023, look for more advertisers to adopt more sophisticated persona-based targeting approaches to reach consumers whose lifestyles align well with their brands or services. For instance, advertisers can work with some CTV providers that use an audience-first targeting approach that leverages audience personas, based not only on direct interests but also adjacent interests and behaviors, such as budget-conscious shoppers, young professionals or outdoor adventurers. This gives advertisers additional relevant layers of targeting to capture potential customers missed by a narrower targeting approach.
More Ad Localization and Personalization: In the midst of a highly saturated and bifurcated “national” marketplace, local relevance will remain a top advertiser priority — and advertisers are demanding more localization to tailor their creative to different audiences in different markets in their CTV campaigns. Beyond this, the use of new dynamic creative capabilities is creating more personalization and relevancy for CTV ads.
By using dynamic creative, CTV ads can be transformed to deliver messaging unique to each individual household with localized and interactive enhancements. For instance, a hotel brand can embed a scannable QR code into a CTV ad that enables a viewer to browse their different properties, make a reservation and find directions to the nearest location. Aside from making ads more personalized, this adds more ad relevance to drive advertiser KPIs with specific localized and personalized call to actions. Window shopping with an “open door to the store” has arrived in the living room through the CTV experience, and it’s not going away. Bet on 2023 to catapult this development to an entirely new level.
Advertisers are clearly betting on the streaming future. In just a few short years, CTV has emerged as a priority and invaluable channel for advertisers to achieve their brand goals — whether it’s brand building or reaching precise audiences with outcomes-based performance. Partnering with brand-safe, premium providers that can deliver powerful data-rich digital targeting, proven measurability and personalization are sure bets for CTV advertisers in 2023.
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