4 Marketing Priorities for Maximizing CTV’s Value in 2024
Author: Tom Cox, President, Premion.
Amid a dynamic economic backdrop, connected TV (CTV) advertising has emerged at the forefront of advertising growth this year. Consumers now have access to more streaming TV options than ever, and virtually every streaming provider has launched an ad-supported streaming option. All signs point to an ad-funded model being the driving force for the streaming future.
Free ad-supported streaming TV (FAST) channels are spearheading this movement. These platforms have become the epicenter of viewership, attracting audiences seeking diverse content options, a trend amplified in a year marked by rising subscription fees. According to Parks Associates, the number of U.S. ad-supported streaming households surged to 41% in this year’s third quarter, up from 31% in Q1.
Advertisers have not only embraced CTV advertising but are also shifting more dollars to the medium. Our 2023 CTV/OTT Advertiser Study revealed that two out of three advertisers using CTV/OTT planned to increase their spending this year. Moreover, a majority (62%) are reallocating funds from their digital, social media or linear TV budgets to fund investments in CTV/OTT advertising.
For 2024, BIA projects that CTV/OTT will be the fastest growing media channel, increasing 39.5% over 2023. Furthermore, Insider Intelligence forecasts U.S. CTV advertising revenues will soar from $25.09 billion in 2023 to $40.90 billion by 2027.
As we brace for an eventful year with the convergence of the 2024 election cycle and the Olympics, here are four takes on the priorities ahead for CTV advertisers in 2024:
1. Don’t overlook brand safety implications with FAST channels. These channels wield massive consumer appeal, particularly for budget-conscious viewers amid rising subscription costs. This user-friendly model is driving broad adoption across generations. Going beyond entertainment, FAST channels are also helping to extend the reach and life of local news.
While the growth of FASTs offers advertisers greater access to CTV inventory, they should consider the brand safety implications, since not all FAST channel inventory is equal, especially in programmatic or open exchange buying approaches.
2. Ad dollars to prioritize outcome-driven performance. With more dollars flowing to CTV, marketers will want to ensure that their media investments drive tangible business results. Advertisers can now correlate CTV ad exposure with sales data to determine the impact on new sales from a streaming TV campaign.
The availability of outcomes-based tools like attribution and brand-lift studies enables CTV advertisers to optimize spending, ensuring that they reach their desired audiences and drive business outcomes. Thus, we expect advertisers to demand greater proof from their providers on ad-spend effectiveness, demonstrating sales conversions through attribution and advanced measurement tools.
3. Coviewing is a valuable metric for proving ad-spend efficacy. While linear buyers have long used viewers per viewing household (VPVH) to measure audience viewership in linear TV, coviewing often goes unnoticed among CTV advertisers. Now, more advertisers are realizing the significance of counting each impression, especially to understand effective CPMs and how coviewing influences engagement.
Consider eCPM, the effective cost-per-thousand impressions, from a publisher’s perspective and revenue generated from it. This can be considered the genuine value of delivered ad units counting the entire audience. Coviewing drives engagement and is closely tied to premium content. Our study found that more than half of CTV/OTT advertisers agree that coviewing is a value-add benefit of CTV/OTT advertising and provides a like-for-like comparison to linear TV.
4. CTV’s vital role for winning elections in 2024. Streaming TV may be crucial for engaging voters in the 2024 election cycle, especially in swing-state contests where geotargeting capabilities are table stakes. Political campaigns that relied on traditional TV must fully embrace CTV to reach diverse voter segments and connect with those who are unreachable through linear TV alone.
In the last midterm cycle, savvy political advertisers were accustomed to harnessing first-party voter files, donor lists and supporter information, alongside third-party data, for precise CTV targeting. Now with dynamic creative capabilities, political campaigns can deliver personalized CTV ads and hyperlocalized content to drive engagement and prompt actions. These might include delivering candidate information via QR codes to a voter’s phone or prompting volunteer sign-ups for phone banks.
For the upcoming 2024 cycle, political campaigns cannot overlook the advanced targeting, efficiencies, waste reduction and significant reach offered by streaming TV.
The trajectory of CTV advertising remains on an upward curve, underscored by its proven effectiveness in driving full-funnel outcomes. With greater access to brand-safe premium inventory, sophisticated audience targeting and advanced measurement, brands and marketers are tapping into the growing CTV opportunities to drive their businesses forward.
As advertisers shift more dollars to streaming TV in the coming year, grasping FAST intricacies, prioritizing brand safety, recognizing the value of coviewing, and harnessing advanced capabilities to drive brand and political outcomes all take center stage. Partnering with trusted providers able to aggregate audiences across platforms becomes essential in unleashing CTV’s unparalleled targetability, measurability and relevance.
About
Premion is a 14-time award-winning, industry-leading CTV/OTT advertising platform. With directly sourced inventory from more than 125 premium publishers, Premion enables advertisers to target and reach engaged streaming audiences at scale in all 210 DMAs. Backed by local OTT experts covering every corner of the U.S., Premion understands unique local characteristics, viewer trends and the power of local relevance that drives outcomes for advertisers.
Tom Cox
Tom is president of Premion and head of corporate development at broadcast company Tegna. He leads Premion, the industry-leading streaming advertising business and directs Tegna’s corporate and business development activities and venture portfolio. Tom has spent 20-plus years in strategy, development and operations leadership roles within digital and traditional media and across company lifecycle stages. He oversees the overall strategic direction, operations and financial performance of Premion, which has scaled quickly as a premium CTV advertising leader. Previously, Tom has held various leadership roles at Fox Digital and AOL Time Warner. Tom is a graduate of Washington and Lee University where he earned degrees in economics and politics.
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