With digital disruption and technology ruling different aspects of our lives. Right from the time we wake up in the morning to throughout the day’s work and till the time we go to bed, every facet of our lives has turned digital.
One of the prominent instances is when we say bye to traditional TV sets and more to smart TVs. We’re now embracing Connected TV, resulting in increasing the market; want to know how it creates ripples in the ad tech industry? This article can give you a quick glimpse of the Connected TV market and more.
Connected TV (CTV) advertising was the fastest growing significant sector of the US digital ad spending market. The CTV investment in the US increased by 40% in 2020 and is estimated to reach around $9 billion. CTV ad spending is growing and is forecasted to grow from $17.44 billion to $19.10 billion by the end of 2022.
Connected TV advertising saw great benefits during the COVID spread; it remains one of the fastest advertising channels. During the period, linear TV decreased in importance to advertising as cord-cutting accelerated and programmatic CTV inventory became more available than ever before. Viewers are moving towards the CTV.
What is Linear TV?
It’s a traditional system where viewers are allowed to watch a scheduled TV program when it is broadcasted on its original channel. DVR is used to record the program and watch it later. Linear TV boasts the largest market; moreover, its reach is fragmented due to the competitive TV landscape.
What is Connected TV (CTV)?
CTV is a device that connects or is embedded in a TV to support video content streaming. Connected TV is an integration of web 2.0 and the internet that is featured in the new-generation TV sets. In simple words, connected TV can be supported by a different device designed in a way that is compatible with multimedia.
With CTV, viewers can access streaming services from video streaming platforms like Netflix and YouTube. They can even search for digital content on the web, including movies, images, etc. Connecting to the internet, they encompass set-top boxes, smart TVs, gaming consoles like PlayStation, and Xbox, streaming devices such as Chromecast, etc. Different CTV types include Roku, Amazon Fire TV, Apple TV, and more.
What is Over-the-Top (OTT)?
OTT is simply a delivery of video content from the web. Users do not have to subscribe to a satellite or traditional cable provider to access streaming content; they can watch this content on different devices, including smartphones, tablets, desktops/laptops, etc. The streaming content is delivered in a VOD or other format. Different types of OTT services include Hulu, Amazon Prime, and Netflix.
Top flicks are stealing the spotlight when it comes to the South OTT boom. Mass network and media also have launched their OTT services like NBC’s Peacock, Disney+, etc. The rise of OTT and CTV has resulted in the phenomenon called “cord-cutting”. It’s one of the growing trends as more customers are canceling satellite subscriptions and traditional cable in favor of using these streaming or VOD formats.
By 2020, the households not paying for traditional TV services in the US alone are forecasted to reach 31.2 million. As of 2019, more than 24.6 million households have cut the cord; this number is projected to increase in the following years and reach around 46.6 million in 2024.
Connected TV Vs. OTT and PTV
Connected TVs subsidize addressable TV advertising possibilities. They thrive on modern tech and represent the tech-based foundations of Programmatic TV (PVT) support. On the other hand, TVs connected with OTT are the same as internet TV consumption but don’t require TV streaming or cable subscription devices. They help to reach the connected TV ad market using the Over-the-Top apps found in the app stores. However, the users would need an internet connection to enjoy the services.
PTV(Programmatic TV) is a simple concept that broadcasts Connected TV ads to the audience enjoying the advantages of algorithmic ad purchasing. PTV encompasses tech-based automation of buying, planning, optimizing, and measuring traditional TV programming. Algorithmic buying is facilitated by programmatic software that is adapted for brands as well as exists as a programmatic advertising platform.
Programmatic TV is an important element for the individualization of advertising approaches. With this new concept, ads can be served virtually on a device that has an internet connection. It assists in focused and targeted advertising as brands can show different ads to specific target groups or households.
In simple terms, users watch different ads while viewing the show as per their age, income levels, interests, etc. Roku’s streaming benefits in the United States are around 41% of the market share America translates to the streaming world, which leads to a 31% share.
The shift from plug-ins and dongles to smart screens has provided momentum to Samsung, LG, and Android-powered CTVs. What is important about these is streaming market shares which are not what number of devices are sold but how these streaming platforms generate per user after the devices are unboxed.
Connected TV: Performance Metrics to Track the Same!
Connected TV is digital programmatic advertising; however, it comprises a TV commercial as an ad unit compared to a banner ad. It utilizes all digital measurements, and thus comes with the promise of accuracy and precision. This attribute is what delivers CTVs an edge over linear TVs.
Connected TV ads are sold and purchased in invitation-only private marketplaces. This leads to participants and increased rates; the advertisers can reach premium inventory in addressable TV programmatic auctions. When we measure the effectiveness of the Connected TV ad approach, the clicks are not doable options.
Descriptive performance metrics like cost per mile, video completion rate, and costs per completed view should be considered. Measuring Connected TV provides insights that allow advertisers to run ads and get the number as to how many individuals saw the ads along with the exact digit. It gives advertisers an in-depth breakdown of the completion rates, equipping details about how many viewers saw the ad from the beginning to the end, how many people dropped out, etc.
Most advertisers these days ask for a 360-degree measurement and analysis of the customer journey so that they can measure the influence of CTV campaigns as well as modify their approaches accordingly. This is where new tools of campaign management and CTV measurement step into the picture!
All the modern solutions help advertisers have quick access to data about the ad campaign’s success, the action viewers’ adobe after watching the ads, and understand the performance of advertising efforts spread across multiple channels. The primary idea is to discover a platform that can assist deliver accountable, reliable outcomes and efficient CTV measurement.
Landscape of the Connected TV Market in India
One of the growing markets in India is Connected TV. India’s smart TV and OTT market are projected to register at a 5% CAGR between 2021 and 2026. High-speed internet has become affordable, and viewers and audiences that prefer good and original content prefer smart TV over other TV systems. The increasing admiration for OTT streaming in streaming content is impacting the smart TV market in a better manner in India.
The shifting preference of viewers towards online and unique content as a result of the growing proliferation of high-speed internet in different parts of India is offering an impetus to market growth.
Substantial investment flows through video streaming media brands such as Amazon Prime, Hotstar, Netflix, etc., led to the growth in Pay TV subscribers. The OTT streaming market in India is predicted to account for 5 billion by 2023. India is forewarned to become one of the top 10 global OTT markets to reach 823 million by 2022.
The affordability of availability of global content, smart televisions, and rising data penetration is the primary factors pushing the growth of internet-enabled TV sets. These will play a prominent position in returning the traditional variants in the times to come. India has also opted for smart TV; Connected TV is predicted to be the game-changing trend for the industry and viewers.
Modern customers are tech-savvy as people prefer online content. They come with targeted and high-end communication, and disposable incomes and demand are useful. In an attempt to tap the increased Connected TV market, advertisers offer relevant and engaging experiences to the target consumers, thus relying on Connected TV advertising.
Connected TV Promise Future of AdTech Industry
2021 was a transformative period, there has been a great shift in how customers connect digitally, and there has been a surge in connected TV screens. Viewers of today are spending time on CTV and OTT content; this will continue to do so in the future ahead, and ad revenues will consequently and eventually spike in this segment.
The CTV market is growing at a notable pace; it seems to have a promising future ahead. Garnering advertiser attention and interest, it becomes essential for the AdTech industry to harness the power of digital advertising. They can be advertised on live streaming software or OTT platforms to reach their targeted audience innovatively.
With the growth in the CTV market, CTV ads are also expected to flourish with time. This trend is evolving the future of the AdTech industry in time to come; thus, the future seems progressive for the industry. They can even use video streaming platforms like Netflix or any other to advertise and upload video content with ease.