For CTV Ads To Succeed, Think New, Not Old

The television industry is in the midst of a slow-yet-inevitable migration from linear delivery to digital… one that will dramatically change the current landscape for advertisers, programmers and viewers alike.

For advertisers, this shift to digital is opening up new and better ways of targeting audiences, delivering ads to them and measuring the results. But taking advantage of this new environment also requires a new way of thinking. 

In short… think digital. The digital TV advertising opportunity more closely resembles today’s Internet advertising model than it does yesterday’s broadcast TV model. TV advertising is no longer solely a top-of-funnel effort, and as such brands need to stop thinking of it in this way. It’s evolving to a full-funnel, highly targeted opportunity that brands of all sizes can participate in on equal footing… if approached correctly. 

For years television was positioned as a mass reach vehicle — big national advertisers would buy network prime time spots in order to reach as many people as possible with the same message at the same time.

Brands could target very broad audience segments based on Nielsen’s demographic categories (e.g., women 18-49) which meant an advertiser would just buy the entire audience during dayparts that seemed to have greater appeal with that demo. Any additional audiences reached outside of that target were just gravy. 

Local broadcast TV appealed to both local and national advertisers for the same reason. It was an opportunity to reach a mass audience in a specific geographic region with a message targeted for consumers in that region. But again, the underlying philosophy was to reach as many viewers as possible, albeit on a local level.

In the digital TV world, that mindset has to change. A new ecosystem of digital-first programmers has sprung up, allowing advertisers to use digital-style targeting to reach targeted audiences both nationally and locally. 

Advertising in this new ecosystem, which has been given the umbrella name “CTV” (connected TV)  is still new. While there is still much that needs to be ironed out, there is also much excitement about the possibilities it offers.

Brands can use CTV to reach audiences based on their own first party data or on third party data from credible sources. They can also use CTV to get incremental reach by targeting those viewers they are missing on linear TV, either because those viewers have cut the cord or because they are just watching less linear TV. Better still, they can reach these viewers on both a national or local basis. 

Finally, CTV offers advertisers far more advanced measurement options. Thanks to ACR data from smart TVs, advertisers can know, on a second-by-second basis, who was watching their ads, how many watched to completion and what actions they took afterwards.

Consider this example — a small skincare brand recently used CTV advertising as a full-funnel marketing tactic to support the launch of a new product. The CTV ad was highly targeted both by user preferences and in locations where the product was available in participating Neiman Marcus stores. 

In addition to driving awareness of the product in a highly targeted way, the ad also facilitated conversion to sales, tracking results through both a QR code that directed customers to an online e-commerce site and geo-targeted traffic to participating stores. The result—150,000 shopping sessions and 3.4x sales in the key markets advertised. 

Campaigns like this highlight the capabilities of CTV, allowing brands to drive new customer awareness, acquisition and sales at the same time. This is a huge step forward for the TV advertising industry, one that will help it compete with its real opponent—the Internet. 

Digital companies like Meta and Alphabet can track every user, every view and every click, giving advertisers a precise view of where their ad dollars are going and the impact they have. 

As TV shifts to digital, programmers and agencies can now provide this same level of granularity, helping advertisers understand the value of their investment in a medium whose ad messages pack far more of an emotional punch than those on digital platforms. 

To be clear, broadcast TV advertising focused on reach and awareness isn’t going away. TV’s transformation to digital will take many years to complete and we can expect to see viewers straddling both linear and digital platforms for years to come. 

But it is no longer the only game in town. There’s broadcast TV and there’s digital TV. It’s important for programmers and advertisers to be able to understand and take advantage of both platforms and the interplay between them.

Just remember, while they both use the word “TV” that’s where the similarity ends. It’s focusing on the “digital” identifier, and all the features and capabilities it carries with it, that will spell the success or failure of these efforts.