CTV in the UK: Things worth knowing.

I get asked a lot about the CTV ad market in the UK. I get asked by AdTech vendors looking to launch in Europe from the US, VC's doing their due diligence on their next European CTV investment, ad agencies trying to figure out how they should be applying programmatic buying practices to the biggest screen in the household, and from streaming publishers, who are often trying to better understand how they can optimise their ad breaks to capture more advertising budgets...

However, the one question I get asked the most..."Is there really enough inventory scale to support CTV advertising in the UK?"

My answer is always and unequivocally yes!

In this post, I try to provide a high level overview of everything you need to be aware of when it comes to the growing CTV ad market in the UK.

Ok, let's tune in....

Household penetration of smart TV sets in the United Kingdom from 2014 to 2022 according to?Statista.

Smart TV ownership will continue to rise in the UK also as the cost of devices continues decrease. Now let's look at the where the CTV ad budgets have been spent, these figures are from the recent?IAB UK Compass Report.

Broadcaster Video on Demand (BVOD) & AVOD continues to grow as TV viewers dial down their SVOD subscriptions.

If you look holistically at both ‘SVOD’ and ‘BVOD’, the UK is currently dominated by eight major services, from the five largest traditional UK broadcasters (BBC, ITV, Channel 4, Channel 5, Sky) and the three largest international SVOD platforms, Amazon, Netflix & Disney+.

When it comes to AVOD growth in the UK, a lot of this has been driven by YouTube over recent years. However, more and more AVOD and FAST services have been launching and increasingly becoming available to UK TV audiences.

This segment of services is growing quickly, driven by better search features on smart TVs (search on TVs will soon be as intuitive as desktop and mobile, as app 'discovery' becomes the next battle ground for TV OEMs over the next several years) and the big ad campaigns being run by AVOD Apps to educate TV audiences about their availability in the UK.

This is a picture I took at one of Londons busiest train stations recently. Look around the next time you are in a major city, AVOD & FAST services are spending BIG to educate TV audiences that they can watch premium content for free...

Ok, so what is being forecasted when it comes to UK CTV Ad Spend?

This is a good recap of the IAB UK?Compass Report?from from John McCarthy at The Drum.

And this is the slide from the IAB UK Compass Report talking to each possible outcome for CTV growth in the UK over the next several years....?￡2.31bn by 2026!!

Ok, what about the UK Broadcasters, are they leaning into programmatic?

In short yes, but each have built unique guard rails when it comes to programmatic to ensure they are fully in control. Many have seen some of the challenges faced by digital publishers in the early days of programmatic and have put frameworks in place to ensure they can fully protect their brands, viewers streaming experiences and advertisers ROI.

Let's take a closer look at how several of the UK's biggest commercial broadcasters are innovating and adopting programmatic platforms such as SSPs and DSPs (or building their own tech) to help monetise their ad breaks that are increasingly being delivered via the household IP, rather than the TV ariels & satellite dishes of yesteryear.

This is a great Q&A with Kate Waters, Director of Client Strategy & Planning, ITV talking about?Planet V?and how ITV is innovating when it comes to programmatic yield management & ad targeting for their TV advertisers.

It is also worth highlighting how committed ITV are to providing content to their viewers in a way that audiences increasingly want to engage with it via their recent launch of?ITVX, a free to air streaming platform. ITV said that ITVX?lifted streaming hours by 55%?in its first month of service compared to the same period last year, and while demand was helped by the soccer World Cup in December, excluding it, streaming was still up 29% year-on-year. ITVs commitment to data driven TV advertising is also illustrated in their recent increased investment in the data 'Clean Room' company?InfoSum.

In this Q&A with?BeetTV?Verica Djurdjevic, Chief Revenue Officer, Channel 4 provides some really interesting insights around how C4 have approached the changing habits of TV viewers, while ensuring they stay at the cutting edge of programmatic innovation when it comes to their ad break and yield management.

Back in 2021, it was reported that Channel 4 would lean into programmatic and open up access in a controlled way to several pre selected DSPs to target their streaming inventory via deals (PMPs & PG) surfaced in the Freewheel SSP.

And how are ad agencies thinking about CTV in the UK?

Simon Thomas, Global Director, Audiences Research GroupM does a great job deconstructing the UK TV market in this Q&A and talks about the infliction point of traditional TV, new streaming services and social content that is increasingly being consumed on connected televisions.

Below, Nicolas Grand, SVP, Transformation, Global investment, Omnicom Media Group talks in depth about how advertisers are looking for more robust measurement solutions in CTV and how it is still almost impossible in the UK to manage holistic reach, frequency and attribution across BVOD and the growing number of AVOD & FAST services being consumed by UK TV audiences. He also talks about the increasing role of 'attention' in measuring CTV ad campaigns.

So, what devices are people using to stream TV in Europe then?

This a great visual (last years data) from?Evan Shapiro?that tells us that Samsung TV currently has market share, followed by Amazon Fire & Android TV.

Ok, broadcasters & YouTube aside, who else is there in the UK?

The rise of AVOD in the UK is FAST. The introduction of ad supported tiers on Netflix and Disney+, as well as increased consumer adoption of non traditional broadcaster owned free or low cost AVOD services powered by Apps & TV OEMs such as Roku, Vevo, Rakuten, Discovery, Xite,?Pluto,?Talk TV,?Sports Tribal, Plex,?Freevee,?DAZN,?LG?et al and (FAST) channels such as?Samsung TV Plus, is expected to generate a lot of new, high quality and addressable inventory for programmatic TV ad buyers to target in the UK.

I hosted the below conversation with Katie Coteman from Warner Bros Discovery at Advertising Week Europe and here we discussed the rise of ad supported and ad lite streaming services in the UK.

The introduction of ads on Netflix and Disney+ alone could increase premium AVOD inventory volumes in the UK by between 17-28 percent over the next 2-3 years according to Tim Cross at VideoWeek in this?article.

In the UK, you might hear AVOD mentioned interchangeably with FAST, which stands for ‘free ad-supported streaming TV’. Yes, they are both ad funded and normally free, however, the one big difference is that AVOD is on demand, and FAST delivers content around an electronic programming guide (EPG), so it looks and feels more like the traditional TV experience you may have grown up with (If you are as old as me!), i.e you get home, put the TV on and a show is already playing, you can then flick through the channel guide. This is a great?explainer on how AVOD & FAST differ?if you really want to learn more & get into the weeds.

When I hear people say 'linear' TV is dying in the UK, I often shout back and say no it is not! Linear TV delivery (i.e scheduled TV content) around an EPG is one of the fastest growing areas of CTV, the only thing that is slowly dying out is the traditional delivery method of TV content. As illustrated in this statement from BBC recently.

This recent?Publica?CTV Explainer?episode I hosted with Nik Dewar, European Sales Director of?Samsung Ads?gets into the details of how TV OEMs with FAST and AVOD services are operating in Europe, and more specifically the UK to attract advertiser demand underpinned with scaled first party data.

What about GDPR? How does that work on CTV in the UK?

Although there are no 3rd party cookies in CTV (Its all App based like mobile), ad supported streaming services and TV OEMs still have to adhere to local privacy legislations and if they operate in the UK, that is the GDPR.

When it comes to DSP's, most if not all will request that CTV publishers pass to them bid requests that contain 'consent' so a targeted ad can be returned in their bid response in accordance to the IAB Europes?Transparency & Consent Framework.

This is why more and more TV OEMs & AVOD Apps are?starting to implement Consent Management Platforms (CMP's)?so they can communicate to their viewers directly about how data is being used to inform the ads that they see in CTV ad breaks etc.

The adoption of CMPs by TV OEMs and streaming services is still building momentum. According to the IAB Europe site, 13 vendors are now approved to operate as CTV CMPs V's the 75+ in display. The full?list of CTV CMPs is here.

If you want to better understand how privacy regulations such as the GDPR are shaping programmatic TV advertising practices in the UK, this is a?good discussion?I moderated recently with Bally from?OneTrust, Josephine from?SourcePoint?& Christian from?LiveRamp.

So where are we at on the TV audience measurement debate in UK?

Well, dependant on who you ask, some might say TV should be measured like traditional TV has been measured for years, with panels. However, others will argue that CTV is digital so it should be measured via impression data. As of today, how the future of TV audience measurement should work remains a moot point, I personally believe it has to be a combination of panels & impression data.

Ok, let's take a closer look then at those trying to build a seamless measurement solution for TV ad buyers in the UK....

Since NBCU’s sister company Sky announced back in 2019 that it would bring?CFlight?to the UK, ITV and Channel 4 both signed up to help develop the product, meaning their linear channels and apps are measurable through CFlight. STV, UKTV and Channel 5 are covered by CFlight too, meaning it covers over 98% of UK broadcaster advertising according to VideoWeek.

Barb?reported recently it will expand its reporting to include YouTube and other “fit-for-TV content” on video-sharing platforms. The organisation defines fit-for-TV as content that has editorial input and oversight, meets regulatory compliance, and provides?a safe and suitable environment for advertisers.

UK advertising trade body?ISBA?has announced that Origin, its initiative to build a cross-media measurement platform will undergo final testing towards the end of 2023, before going live in 2024.

One piece of news that got a lot of people excited and talking in CTV circles when it comes to UK TV measurement was the recent announcement that Netflix has signed up to the TV ratings agency Barb, which means its audiences will be measured by an external, independent body for the first time. The move makes Barb the first industry-owned ratings service in the world that Netflix has joined.

Personally, I think this is a really clever move by Neflix, they are proactively leaning into the currency of choice for TV ad buyers in the UK, and this makes it much easier for them to attract traditional TV ad budgets, as well as budgets from digital & social platforms.

When it comes to TV audience measurement in the UK, as you can see, there is a lot of great innovation happening. However, I just hope the industry does not exclude or forget to include the growing number of AVOD and FAST services that UK television audiences now deem as 'TV'.

Hopefully, we can arrive at a point where panels, combined with Automatic Content Recognition (ACR) impression data can be democratised beyond walled gardens to inform the holistic planning & buying of all content streamed via a connected television in the UK.

More below on how ACR data works from the fab team at Digiday.

To summarise…?

Where then will the ad budgets come from in the UK to support this forecasted growth in CTV ad spend? I asked the LI advertising community recently and this is how they responded...

I was asked recently on stage if I felt 2023 would be the year of CTV in the UK, It was a question I enjoyed answering, and one I hope we don't need to answer again in 2024/25/26 etc..

I predict that TV in the UK will become predominantly application based and quickly....We will see smart TV manufacturers making it much easier for audiences to search and discover free streaming services beyond the SVOD Apps that have dominated their TV remotes & home screens.

The AVOD and FAST apps now live in the UK will be building the ad break infrastructure needed to capture traditional TV ad budgets and ad buyers, will increase their budgets in streaming environments due to a growing confidence around ad pod controls, measurement, brand safety, data, privacy compliance, identity & the most crucial component, reaching audiences they will increasingly struggle to target via traditional TV ad buys.

So, the next time you hear somebody say “There is no CTV inventory in the UK market that supports ads" please do challenge their outdated perception...

The key to growing a new CTV ad market in the UK, is education. There are no precedents for the way audiences are now engaging with streaming content, and how data & programmatic technology is being built and used to target TV audiences. So lean in, ask questions, and try to educate those on both the buy & sell sides of addressable TV where you can!

If you are trying to educate yourself further on the UK CTV market, this is a great free guide to download.

And another good guide here on the growing FAST marketing.

Lastly, bravo to the Trade Desk for running this DOOH campaign to coincide with AdWeek in NYC! It did make me smile, looking forward to seeing more tactical campaigns from CTV AdTech companies in the UK this year to help educate those on the buy side..

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*As always, my posts are not indicative of my employers views, these are my personal opinions. If you would like anything corrected or deleted please drop me a DM and I will action that for you ASAP.