Executive Summary
- CTV media consumption is skyrocketing, particularly during COVID.
- Ad spend is not increasing at a comparable rate.
- The article below details the specific things that the industry needs to do to grow the CTV ad market.
- Please register to attend the upcoming “Prove it to Move it” virtual town hall on Thursday, June 11th at 3 PM EST.
- Take our survey to help IAB refine its thinking about the top CTV challenges and opportunities.
If one believes the adage that it takes just 21 days to make a habit and 90 days to form a lifestyle, then there will be no going back to the old days and ways of linear TV viewing. Recent data—from ad server impressions to syndicated audience analysis—shows that audiences have adopted CTV viewing in droves, especially as shelter-at-home orders began to take hold in March.
Indeed, according to Nielsen during the week of March 16, consumers watched over 156 billion minutes of streaming content — up from 115 billion the prior week and more than double the same week in 2019).
In parallel, the largest pay TV providers lost over 2 million subscribers in Q1 (more than double the approximately 1 million subscribers lost over the same time period in 2019[1]) as the number of cord-cutter and cord-never households continues to grow[2].
These changes bring into focus challenges that traditional TV has faced for years: high cost of bundles relative to SVOD services, competition from a seemingly endless banquet of high-quality, ad-supported OTT services, as well as (another blow from COVID) the loss of live sports that has long served as pay TV’s defense against streaming competition.
The overall shift to CTV has major implications for brands in terms of how they’ll connect with a growing universe of cord-cutters and cord-nevers.
Some of this migration will happen organically as media buys on publishers’ apps appear naturally on the various connected devices in the household. Some will have to be more purposefully planned. But the core question for the industry now is whether we’ll see a rightsizing of spend in the market, with advertisers allocating spend in a way that matches viewing behavior. If not, why not?
In order to understand where we are in this moment, we invited a core group of brands, publishers, and buyers to weigh in about the case for CTV. What are the gaps and what’s needed to move the OTT streaming video space forward?
Our industry respondents agreed that the industry should lean into four areas to shift more spend to CTV:
| Key CTV Areas of Friction for Brands and Agencies | |
|---|---|
| Cross-Platform Video Measurement | How to accurately determine incremental reach and frequency for CTV buys? |
| Transparency | How can buyers understand at a program title level where their CTV ads are running and ensure they are placed in brand safe, verifiable inventory? |
| Mechanisms to manage frequency, audience overlap, and redundant targeting in a fragmented ecosystem | How can advertisers make sure that—when they purchase inventory through programmatic or direct means—they aren’t paying twice for the same impression coming from multiple sources?[3] |
| ROI Justified Pricing | How can buyers feel confident that highly targeted CTV impressions are worth the extra expense of higher CPMs when compared to untargeted linear TV impressions? Or, “is the juice worth the squeeze?” |
Here are some verbatim quotes from our industry respondents.
Are advertisers spending the right amount on CTV versus traditional linear TV?
What’s the most important thing buyers are asking for and looking to achieve with CTV advertising?
What’s the biggest gap in CTV advertising?
What are some of the solutions that exist right now (or coming soon) that make it easier for buyers on CTV?
Optimizing to save clients’ money:
Don’t pay twice for the same impression:
Reaching the “unreachables” (cord-cutters and cord-shavers):
Before the townhall, please share your thoughts about what’s needed most to improve CTV advertising by taking this short survey.
For more information about IAB’s Tele://Vision initiative visit: https://www.iab.com/news/television-initiative/
To receive notice of future IAB Video Center Advanced TV Committee meetings, email [email protected].
If you are in product or engineering, email [email protected] to join the IAB Tech Lab CTV Working Group.
[1] Source: Leichtman Research Group, Major Pay-TV Providers Lost About 2,065,000 Subscribers in 1Q 2020
[2] Source: eMarketer, 2020, (Cord cutters currently estimated at 21.7 % of households and cord-nevers at 16.1% (each estimated to grow to 30% and 16.9% of households by 2023)
[3] A result from supply chain problems like bid duplication and resold inventory.
