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Exciting times for Connected TV

Mobile Marketing - Member Content

Will Keggin, Director, Advanced Advertising, UK at LiveRamp, looks at the future of Connected TV.

Connected TV (CTV) is gaining fast traction in the UK not only for consumers, but also for the ad industry, where the fastest growing pool of inventory is now addressable. This inventory offers advertisers greater efficiency in reaching audiences, and provides marketers with identity resolution tools to leverage alongside sales and transaction data, and even dive beyond the ROI of the campaign.

The data is clear on the popularity of the format for consumers. Smart TV ownership has skyrocketed, from ownership in 11 per cent of UK households in 2014, to ownership in nearly 67 per cent of UK households in 2021. And consumption via these Smart TVs continues to escalate year after year; Ofcom’s 2021 report found that total viewing of audio-visual content increased by 47 minutes to 5 hours 40 minutes per person per day in 2020, relative to 2019. 

With 80 per cent of homes in the UK having at least one TV connected to the internet, it’s clear that the ripe opportunity and growth of CTV is intertwined with the increased ownership of Smart TVs. 

The growing addressable inventory also offers all current TV advertisers, and potentially new-to-TV advertisers, greater targeting options to build efficient reach. Advertisers and their agency partners would like to buy against a consistent audience definition across all inventory. Broadcasters would increase the size of the TV market, attract more advertisers and different budget types by offering their clients a safe, easy and consistent way to use their audience definitions on valuable TV inventory. 

As connected TV increases in popularity, the opportunities for TV advertising have transformed, paving the way for targeted CTV advertising. The advantages for the advertising industry are clear. Moreover, getting the most from advertising investment is better achieved with CTV because it is measurable and accountable. 

The prospect of pursuing advertising strategies that have a better and clearer ROI is vital. CTV creates a connective ecosystem that allows brands to link output and see an omnichannel reach across platforms whilst also ensuring broadcasters continue to see the commercial benefits.

Indeed, 67 per cent of UK advertising professionals think CTV is a more effective ad channel than linear TV, showing the opportunities for growth of CTV. Recent research discloses that over 77 per cent of brands would like to invest more in CTV advertising in the next 12 months. The rationale for this investment is split into cost-efficiency (52 per cent), the ability to measure and attribute performance (48 per cent), and because it’s effective for brand campaigns and meets campaign goals (38 per cent). With the perfect storm of people spending more time on their sofas watching TV and the impending end of third-party cookies – the CTV turf is ripe for growth. 

Another advantage is that CTV operates in a cookie-free environment, promising privacy and addressability beyond the next few years. As we near the end of the third-party cookie, marketers are looking towards cookie-free channels of growth such as connected TV that prioritise privacy and addressability. The opportunity for broadcasters, marketers and consumers alike to benefit from this is immense as we head into the new year. 

We’ve already seen this growth trajectory in the US and France – and the UK will not be far behind. But collaboration will be critical in unlocking the potential of omnichannel advertising. 

Brands and media sellers need to be able to safely connect cross-screen data such as advertising impressions for advanced business applications, including closed-loop measurement and collaborative analytics. All parties need to be able to govern their data – but also to collaborate many-to-many as needed.

On the sell-side in particular, TV players will look to cooperate in obtaining access to data and inventory while retaining control of their own. Audience measurement is the starting point, but brands then need to be able to activate their own audience definitions and be able to measure the effectiveness of their TV advertising – not only to brand and reach goals, but to business outcomes – if TV wants to compete for the budgets which continue to migrate to the scaled, global, video platforms. To retain and grow TV investment, greater collaboration is needed between buyers and sellers to make using data safe and easy to use, and make TV a better investment.    

Taking this all into consideration, our prediction is that CTV will continue its explosion in 2022, riding the wave of changing viewer habits and broader advertising industry trends. In this new normal, best-in-class brands will distinguish themselves with their investment and data collaboration with their TV partners.

The most advanced advertisers will continue to demand better measurement and greater transparency from their media investments. We will move beyond audience measurement – who has seen a TV ad and how many times – to outcome-based measurement, link viewing, customer behaviour and sales. With SVOD now challenging traditional TV for time spent and reach for any audience below the age of 45, all brands will be asking for greater data access to break down channel silos and find the most cost-effective way to extend incremental reach for their TV budgets. 

Media buying agency structures and technology will have to evolve to meet advertisers’ demands; we will see internal team silos broken down to deliver on ambitions for true cross-platform video or ‘Total TV’ planning and activation. To deliver on these goals, agencies will need to access the right data sets and ensure they can be applied consistently to their clients’ campaigns in a safe and secure manner. Accessing the right data will require the right technology; some will build, while others will deliver clients’ needs for transparency and portability by leveraging their expertise on third party technology solutions.

For TV platforms and publishers, 2022 will be the biggest year to date for collaboration, with deepening relationships leading to consolidation around inventory marketplaces and even sales teams, with Channel 4 potentially up for sale.  

Finally, the use of data in TV and CTV will rocket, and the most important area to watch may be how CPG data sets from the UK’s largest retail loyalty schemes will be used in the TV space.

 

 

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