Dive Brief:
Marketers said they boosted their spending last year on connected TV (CTV) by 22% to an average of $19.97 million as they sought to reach consumers who spent more time with streaming video platforms, according to survey results that the Interactive Advertising Bureau (IAB) shared with Marketing Dive. CTV growth was faster than the 4% gain for mobile video and 3% for desktop video.
About three quarters (73%) of CTV buyers said they're shifting their spending from broadcast and cable TV, while only a third (35%) of advertisers expect to increase CTV video ad spending this year, the survey found. The highest-growth categories for CTV spending are health and wellness with a 144% gain, followed by finance (+97%), travel (+92%), telecom (+71%) and media and entertainment (+48%).
Audience targeting, which is expected to be a hot topic at this week's NewFronts presentations, was cited by 46% of respondents as a key benefit of connected video platforms, according to the survey of 350 marketing and agency executives conducted by Advertiser Perceptions from March 19 to April 15. CTV provides high-quality content, according 61% of respondents, while 60% rated CTV for delivering a trusted, brand-safe environment.
Dive Insight:
The rapid growth of CTV advertising is poised to continue this year as marketers adapt their media-spending plans to the significant shift in viewing habits, the IAB's survey indicates. The trade group released the results as media companies showcase their programming, audience reach, measurability and other key features at this week's NewFronts sales presentations, which are virtual for the second straight year because of the pandemic.
"This is a bellwether moment in media that reflects the continued acceleration and shift to digital," Eric John, vice president of IAB Media Center, said in a statement. "While we are seeing growth across all digital video, the movement to more audience-based buying approaches has resulted in increased buyer demand for CTV."
Audience addressability is a key theme as marketers seek to improve their targeting and personalize their messaging to households and even individuals who have separate logins to CTV apps. Streaming platforms allow for audience-based media buying that's more focused on consumers that are most likely to buy products, rather than blanketing broader age and demographic groups with the same ads. That targeting relies on first-party audience data, which more than three quarters of advertisers described as important in deciding which video platforms will carry their ads, according to the IAB study.
"This year's study shows us that advertisers are looking to buy video in the ways that people are actually watching it," John said. "We now have the ability to move beyond legacy demo-based approaches to reach the specific audiences that matter most to brands. Publishers that offer more addressability and robust first-party data, while effectively measuring results, will win the day.”
First-party data have become more valuable to marketers as they seek to improve their audience targeting, which is a bigger challenge as technology companies like Google and Apple take steps to give consumers greater control over the way their personal information is shared. Google next year will stop supporting third-party cookies, a common audience tracking technology, in its popular Chrome browser. Apple last week updated its software to ask customers for permission to share their device identifiers with advertisers, a move that's expected to interfere with ad targeting.
