Traditional TV is on the decline. The times of having the whole family gathered around the TV in the evenings is becoming a distant memory due to the rise of streaming and connected TV (CTV).
When we say connected TV, we’re referring to any television set that can connect to the internet to stream video content, offering access to a wide range of online services beyond traditional broadcast or cable. This includes both smart TVs with built-in internet capabilities and standard TVs connected to external devices like streaming sticks or gaming consoles.
Last year, Warner Bros Discovery announced a $9bn (£7bn) writedown in the value of its TV networks. This pushed the US entertainment group to a quarterly net loss of $10bn (£7.9bn) and shares dropped by 12%.
People are moving away from high-cost TV packages in favour of low-cost streaming services or even relying solely on short-form video players like YouTube and TikTok.
So, what is the solution for advertisers that previously relied on getting their adverts seen during that family gathering around the TV time?
Companies are now looking to CTV advertising methods as a way to reach this new generation of ‘cord-cutters’.
The Stats:
- Only 56% of Americans say they watch TV via cable or satellite, down from 76% in 2015.
- 71% of those who don’t use cable or satellite say it’s because they can access the content they want online.
- 61% report that they had a cable or satellite subscription in the past.
- 39% say they have never been subscribers.
Who and What are Cord-Cutters?
Cord-cutting refers to the pattern of viewers, referred to as cord-cutters, cancelling their subscriptions to multichannel television services available over cable or satellite and instead opting for media available over the internet. This content tends to be either free or significantly cheaper than the same/similar content provided via cable. In 2022, cord-cutting became the majority when the market share of satellite and cable subscribers dropped to 48%. In the US, cord-cutters are thought to comprise of 72% of households by the end of 2025.
We also have the cord-nevers, those who have never used commercial cable or satellite for television service, relying on internet sources from the start.
Embracing CTV Advertising
CTV advertising doesn’t struggle with the limitations that traditional TV advertising does. CTV allows brands to tailor messaging and display personalised ads to niche audiences.
Advertisers and marketers can access key data such as viewer preferences and habits that provide deeper insights into their buyer persona. Based on this data, the ads and the viewing experience are personalised to increase engagement, whereas traditional TV advertising would display the same ad to all the viewers watching a show.
The Benefits of CTV Advertising:
- Engaged User Base: Adverting to an engaged user base increases effectiveness as viewers show a greater likelihood to engage and interact with the ads.
- Precise Targeting: The ability to ensure precise targeting and serve personalised boosts engagement and conversion rate as the ads appeal to the viewer’s interests.
- Detailed Metrics: More detailed metrics to track and measure campaign performance, optimise on the go, and improve ROI.
How a CTV Media Buying Agency Can Help
Working with a connected TV media buying agency can help you by accessing a variety of data types to target your ideal customer. Some of the data a media buying agency can help you acquire and use in your campaigns includes:
- Demographic Data: Information about a viewer’s age, gender, location, household size, and income can help advertisers target specific demographic groups.
- Geographic Data: Geographic data allows advertisers to target viewers based on their location, enabling local, regional, or national targeting.
- Behavioural Data: Behavioural data includes viewers past actions and interactions on the CTV platform, such as content consumption, search queries, and app usage. It helps identify users interests and preferences.
- Contextual Data: Contextual data takes into account the content being watched. Advertisers can target viewers based on the genre, topic, or keywords related to the content.
- First-Party data: Advertisers can use their own first party data, such as customer data from their CRM systems, to create custom audience segments for targeting.
- Third-Party Data: Third-party data sources provide additional insights from external data providers. This data can include interests, shopping behaviours, and more.
- Social Media Data: Data form viewers social media profiles and interactions can be used to target audiences with similar interests and behaviours.
Partnering with a CTV advertising agency means benefits such as:
- Cost Efficiency: Agencies optimise ad spend to ensure you get maximum ROI
- Expertise in Ad Creation: Agencies specialise in creating high-quality, engaging ads that resonate with viewers.
- Access to the Latest Technology: Agencies will leverage the latest tools to measure campaign performance and adjust strategies in real time.
- Data Privacy and Compliance: Agencies can help brands navigate the evolving landscape of data privacy and ensure compliance with regulations while still achieving effective targeting.
CTV is the way forward for advertisers and businesses. With the number of cord-cutter households continuously on the rise, if your business hasn’t already gotten started in the world of connected TV advertising, now is the time to do so.
At The Media Planning & Buying Agency, we’re able to get your ads placed on the screens that your target audience are actually watching with measurable impact. To get started, click here to send us a brief or click here to download our credentials.
