The Pandemic’s Effect on Connected TV (CTV) Advertising
by Katy Treadwell
It’s no secret that one of the biggest impacts on linear TV growth over the past year has been the coronavirus. It has drastically accelerated the transition from traditional TV watching to streaming options, like CTV (Connected TV) & OTT (Over-The-Top).
The differences between CTV and OTT are sometimes hard to follow, but the easiest way to distinguish the two is to think of CTV as any streaming content that you watch on the TV mounted to your wall, while OTT is streaming content that you watch on your phone, laptop, or tablet. The main difference between the two is simply the screen on which the content is delivered.
From the end of 2019 to the end of 2020, Vizio saw a 95% increase in streaming hours on its platform. The accelerant? People were home significantly more during the pandemic. In fact, the first 3 months of the pandemic, Vizio added 150 free streaming channels to its SmartCast platform.
In addition, NBC’s Peacock just launched in July of 2020 and already it has over 33 million subscribers.
At the end of 2020, Roku led the way and had 51 million monthly users, Tubi had 33 million, Sony’s Crackle had 30 million, Pluto had 28.4 million and Xumo had 24 million – all of which are sure to have grown since the last count.
Since this surge, more data has become available and more research has been done to help us better understand the impact of Connected TV and streaming on consumer behavior.
By using Automatic Content Recognition (ACR) data from smart TVs all over the world, we can look at both linear and streaming campaigns at scale to analyze audience reach. So far, data from major companies like Vizio indicates that businesses relying on one or the other (streaming OR linear) are missing up to 50% of their audience. They are also ONLY getting a minimal one, two, or three frequency with linear alone.
What that means for small and large businesses alike is that linear and connected TV work best when they work together.
Here’s the best part: you don’t have to increase your marketing budget to do both. You just need to shift the share of your budget.
Shifting some of your existing linear TV budget to connected TV and OTT can help increase your share and significantly grow your reach among your target audience.
Not every change means raising the budget. It simply means getting your message in the right place for effective reach.
Adam Bergman, VP of National Sales at Vizio, says, “ I don’t think there are many marketers and agencies that you have to convince that streaming is where dollars need to go. I think what every advertiser knows is that they’re just not going to hit the required reach and frequency they need by just being on one platform or the other. They have to be thinking about linear and streaming collectively.”
The digital share of video advertising is growing rapidly, and experienced buyers from ALL industries predict an even bigger shift to digital TV budgets in the coming weeks, months, and years. And while all of this may seem new and kind of daunting, it creates tons of opportunities for brands and businesses, big and small, to breakthrough.
To learn more about CTV/OTT and how to effectively add it to your marketing mix, check out our Alpha Digital solutions and see how you can get started!