Traditional television programming is on the decline, with over 2.8 million consumers “cutting the cord” and canceling cable or satellite subscriptions in 2018 alone.
One of the common reasons given for cutting the cord is the availability of streaming media options for connected TVs and mobile devices. While this offers additional options for consumers, it does create issues for advertisers and marketers who make extensive use of traditional television content as an ad medium.
This doesn’t mean that there are no ad opportunities on connected TV streams, of course; although a relatively small number of content providers dominate the streaming media realm, there are a number of other smaller players that largely rely on ad support.
Even the hardware used for connected TVs such as some smart TVs and hardware components like Roku devices often have integrated ad platforms.
Connected TV and Ad Tracking
One problem that many marketers face when trying to transition to the connected TV space is that ad tracking doesn’t work the same for streaming media ads as it does for websites or other digital platforms.
When working on a computer-based platform, cookies or other digital markers are used to track ads and gauge their effectiveness. The connected TV platform doesn’t have cookies, however, and both hardware and software manufacturers tend to limit the user data that marketers can collect.
Of course, there are still ways for marketers to track ad impressions and gauge their effectiveness. Ad tracking can occur through a process known as cross-device targeting, in which vendors are able to uniquely identify devices receiving content and associate them with other devices within that household. Using multiple points of data, these vendors can track impressions across CTVs and other devices and provide useful metrics up to and including ad conversions.
Ad Impressions on the Rise
For the full year 2018, connected TV ad impressions increased by a staggering 193 percent year over year in comparison with 2017.
Perhaps even more impressive, according to Extreme Reach’s Video Advertising Benchmark report, connected TV ad impressions for the fourth quarter of 2018 made up 44 percent of digital video impressions across desktop, mobile, tablet and CTV. For comparison, in Q4 2017, the ad impressions from connected TV made up only 16 percent of impressions across these same platforms.
This rise shows that ad impressions on connected TV platforms are growing at a fairly rapid clip within the OTT sector. This shift is aided by the increased availability of smart TVs and other connected television devices, especially as prices drop and become more affordable to the average consumer.
An increasing number of streaming media channels owned and operated by major entertainment companies such as CBS, Time Warner Media and Disney may also influence these numbers, as high-quality exclusive content will encourage adoption of connected TV hardware even if the channels themselves are not ad-supported.
One point that is interesting to note is that despite the increasing viability of targeting connected TV content, the platform is not currently considered very effective by most marketers.
Nielsen survey data from 2018 found that while 68 percent of respondents viewed search and social media advertising as either very effective or extremely effective marketing channels, only 28 percent ranked connected TV or over-the-top (OTT) channels as very or extremely effective. In fact, 30 percent of respondents didn’t even have a budget allocated to connected TV and streaming media advertising.
With the drastic uptick in year-over-year ad impressions on connected TV platforms, however, it’s only a matter of time before digital marketers start changing their views on streaming media as an advertising channel. Those who view it as a legitimate and even fruitful marketing platform sooner will be more likely to reap the benefits of early adoption later.