This newsletter comes from the hosts of The Marketing Architects, a research-first show answering your biggest marketing questions. Find us on Apple Podcasts or wherever you listen to podcasts!
This week, we're exploring the evolving world of Connected TV advertising with Chief Media Officer Catherine Walstad. We separate fact from fiction and examine if CTV is living up to its promise or if it's an overpriced, overhyped mess.
—Elena
Average CTV usage in the U.S. will increase to 2 hours, 37 minutes by 2026.
eMarketer projects CTV usage will nearly double from usage in 2020, and 61% of advertisers plan to increase their CTV budgets this year.
Time for a CTV reality check.
Gone are the days of treating Connected TV as a miracle channel with digital-like tracking. Today, marketers understand that while CTV offers unique opportunities, navigating its complexities requires strategy and expertise. Here's what you should know:
- The hype cycle has evolved. We've moved past blind excitement into "maturing optimism." Marketers now understand CTV's strengths and limitations better than during the post-COVID boom.
- CTV is not TV ‘like digital.’ Despite early excitement about digital-like tracking and targeting, CTV is a unique channel. It combines the lean-back viewing experience of TV with some digital capabilities, but expecting it to function exactly like digital leads to disappointment.
- High CPMs come from hidden fees. The "inventory scarcity" excuse masks the real cost drivers for CTV—tech middlemen, targeting fees, and supply chain complexity. Work with partners who have optimized supply paths to control these costs.
- Transparency remains a challenge. Many brands don't know where their ads actually run. Premium inventory often gets bundled with lower-quality placements, leading to misleading performance metrics and wasted spend.
- It's both brand and performance. The debate about CTV's role misses the point. When bought and measured intelligently, CTV delivers both brand building and performance outcomes.
- Linear TV isn't dead. The most effective approach to TV combines linear and CTV. Together, they multiply impact rather than just adding incremental benefits.
“Buyers Say CTV's Transparency Problem Remains a Roadblock to Investment”
This AdExchanger article examines how transparency issues with bundled inventory have damaged marketer confidence in the channel. Many brands discover their premium CTV buys actually include less valuable inventory, but publishers are reluctant to change practices that sell undesirable placements.
Prepare for TV to change.
“Change before you have to."
— Jack Welch, former CEO of General Electric