Television advertising is moving to digital and this is great news - both for advertisers and viewers. (Photo: Samsung)
When considering the future of media technologies, it is always important to look beyond the hype and assess where audiences are migrating and what options are available to them.
Based on these criteria, one technology stood out above all others as it showed impressive growth throughout the pandemic and beyond.
I am of course talking about the smart televisions, or more precisely, connected televisions (CTV), which entered our lives in the last decade and drastically changed the way people watch television and consume content.
Viewers now have access to thousands of movies and TV shows through streaming services like Amazon Prime, Netflix and Hulu, while analog broadcasts are rapidly disappearing from the world.
This change in user behavior has had a major impact on the advertising world, and as a result, we are now reaching a tipping point in smart TV market penetration, with consumers increasingly using their TV to stream content directly from built-in IP apps and services.
Not only have smart TVs become very common, when it comes to streaming services they also turn out to be the preferred type of screen for viewers.
Across the US, Germany and the UK in 2021, 88% of viewers of streaming services used their TV to access content. As the streaming industry moves towards an IP-based future, smart TVs will take a more central place in the home. Kantar ComTech's 2021 research shows that in
markets In the EU5 (France, Germany, UK, Italy and Spain), 64% of households own a smart TV, and in Brazil, smart TV penetration has doubled in just four years, reaching 57% of homes in the same year. According to Dentsu Group's forecast for 2023, the TV
market Hacham is expected to reach a significant double-digit growth of over 20.2%.
The rise of advertising on smart TV and streaming channels
Traditionally, television advertising was conducted through the fixed broadcast schedule of satellite and cable television channels.
The consumer had no control or influence on the type of ads he sees and had no option to skip them.
Ads were delivered to viewers without any user-level targeting method.
But if until 2021, most streaming services were granted to the customer in exchange for a monthly payment, in June 2021 this situation was reversed, when HBO Max launched for the first time an option for a free subscription supported by advertisements.
The competition was not slow to respond and a short time later we saw similar moves happening at Netflix and Disney+.
Compared to traditional TV commercials or even digital video ads, CTV ads are more cost-effective because they can be targeted to very specific audiences, increasing campaign ROI.
In addition, since CTV ads are displayed directly from the streaming services themselves, they do not require integration or additional set-up time on the part of the advertiser and can run in a short time.
This is sensational news, and the industry has every reason to be excited.
First, because it is a type of restocking in the digital advertising market, which is crying out for additional supply.
With the future of SEO in jeopardy and social media attention dwindling to zero, free-to-air TV provides advertisers with fertile, far less plowed ground to grow their brands.
Even the viewers, who have traditionally been used to watching commercials on television, live with this compromise in peace and are ready to absorb some commercials in exchange for free viewing of their favorite shows and movies.
Although most of the streaming platforms have not yet opened up to the Israeli advertising market, it is only a matter of time until all competitors follow Netflix's lead and also offer their advertising products to Israeli marketers.
So how do you actually advertise on Netflix?
Due to the high demand, the Netflix advertising program is open to only a limited number of advertising agencies in the world, among them the advertising giant Dentsu.
Fortunately, Dentsu's collaboration with Israel's Pareto Solutions, which the companies announced last month, has opened the CTV advertising market to Israelis as well.
Now, Israeli marketers and creatives will be able to leverage the principles of performance-based advertising and apply them to the Netflix content medium.
The performance advertising principles developed on digital platforms, such as accurate measurement of profitability and the creation of segmented and precise creatives that motivate action, continue to be relevant in streaming channels and help advertisers build a brand presence alongside results-oriented business activity.
The technology itself offers an opportunity to combine more interesting offers across a well-defined and easy-to-understand format in terms of context, while combining accumulated insights from analog advertising with the improved targeting tools of online advertising.
Since many streaming services allow users to pause or rewind live broadcasts and even skip commercials, which is not possible with traditional TV commercials, more and more advertisers are choosing to show their ads during the broadcast.
The use of banners that appear on top of the content as advertising space is increasing.
Almost 75% of programs broadcast in the US show ads during the broadcast, with the goal of reaching those viewers who are difficult to reach through conventional advertising. The dynamic ad placements allow each viewer to be shown personalized ads, based on everything we know about them.
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Unprecedented automation and measurement
In addition to being cost-effective and easy to set up, CTV advertising offers a variety of other benefits.
For example, unlike digital ads that rely heavily on cookies for audience targeting purposes, CTV ads use more precise data points such as age, gender, location, etc., making it easier for advertisers to reach their goal - serving relevant messages to the right audiences that will connect with them on an emotional level.
Since most streaming services come with built-in analytics tools that track viewer engagement metrics (like/dislike/shares/comments/views/clicks), marketers can also adjust their campaigns in real-time if necessary and maximize ROI.
With accurate data points for audience targeting, and built-in analytics tools that allow marketers to adjust campaigns in real-time, not only is it a great return on investment, but it also gives brands unprecedented control over where their messages will appear within each episode or program watched - making the -CTV for one of the best channels available today for those looking to get maximum results from their ad placements.
Only verified media buyers can operate within the market, and currently levels of consumer cooperation and openness to using third-party data are high, which means trust, quality and privacy are paramount.
Sooner or later it will be necessary to balance the technological possibilities with what is acceptable to the viewers, or at the very least, present a proper disclosure that the content is adapted.
Displaying ads in too prominent a position or displaying unoptimized advertising content will certainly arouse antagonism among viewers.
Bad habits already familiar to us from the mobile and web realms such as low-quality creatives, video at too high a volume, and an obsession with performance at the expense of the user experience and the brand, will probably continue to challenge the advertising market, and the question is whether we will see this happen at CTV as well or whether the professional level will rise.
Marketing and digital
MarTech
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CTV
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