Connected TV: The New Face of Television Advertising

We at RadiumOne have long scratched our heads at the efficacy of generic television commercials. TV ads have always taken the shotgun approach, making wide-swath generalizations about who’s watching a given program and then playing commercials that might or might not appeal to that audience.

With the rise of multi-channel marketing, which tends to be highly trackable, it was inevitable that the television industry would eventually see the light in terms of needing an updated solution for advertising.

That’s where Connected TV (CTV) ad solutions are really beginning to shine. But what is this strange new beast in the advertising world, and is it really better than previous options?

Cutting the Cord = Better Targeting Opps for You

Cable is about to become a thing of the past. In fact, by the end of 2019, it is estimated that over 50% of households will have smart TVs, rendering the need for traditional cable services moot. Instead, TV consumers are picking and choosing what to watch through subscription-based services like Netflix, Hulu, and Amazon Prime, and they’re watching them on smart TVs or using set top boxes like Roku. No longer are they limited by what’s playing right now, or even what they’ve TiVo’d: viewers can watch virtually anything any time through streaming internet-based services.

And cable service providers are no dummies; they might have been slow on the uptake, but many, including AT&T and Charter, are now offering “over-the-top” streaming services to ride the wave of on-demand TV content. They’re making money on internet services, encouraging customers to upgrade so that their program streams quickly and without hiccups.

If you’ve relied on the standard 30-second commercial for decades, get ready for your world to be rocked.

The Prevalence of Customization and Choice

Today’s consumer is in control like never before. She’s able to ignore pop-up ads online if she wants to, send unwanted emails to Spam, and choose exactly the television program that appeals to her. So where does that leave advertisers who previously relied on that old-school model of generic commercials, assuming a captive audience?

In a great place, actually. Programmatic advertising is about to get huge, and here’s why: smart TVs and streaming services are data-smart, meaning that advertisers can get very granular in understanding their audience’s interests and behaviors. With that kind of information available, it becomes completely possible to customize ads and deliver the most relevant commercials and offers to a given demographic.

Not only that, but measuring results now, compared to the old days, is like wearing prescription glasses when your vision has always been cloudy. Your perception of how well your ad campaigns are doing has now become laser-sharp.

It’s early days for CTV ads, but here’s an example of how it works (and you may have seen it in action yourself): many of the content providers, such as Amazon Prime Video, are using targeted ads already. If you want to stream an Amazon Original program, chances are you’ll see a preview of another Original program just before your show starts. Amazon already knows you like Show A, so they are betting you might also like Show B.

While subscribers pay a monthly fee for services like Netflix, other streaming services, like Crackle, are free and ad-supported, opening the doors wide open for advertisers to elbow their way in.

Multiple Devices? No Problem

We know that people aren’t just tuning into their favorite programs on smart or connected TVs; they’re also streaming on their phones or tablets, or even computers. The great thing about CTV advertising is that it doesn’t matter what device someone is on; that advertising will follow (and you’ll get the data about which device a viewer saw your ad on). Try doing that with a standard television commercial!

Inventory is Open; Are You Ready?

In a few years, CTV ads will be the norm, but for now, they’re cutting edge. Ad networks are working to connect advertisers with the most opportunistic spots in an effort to show them high conversion rates and better ROI. Jumping on the bandwagon now, before everyone else does, will establish you as a leader in innovation, not a follower of the pack.