Special Edition: CTV advertising’s effectiveness dilemma

Welcome to a special edition of Change the Channel.

Today we’re bringing you part of the recently published piece “Why Your Streaming TV Strategy Might Be Failing, and How to Fix It.”

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Why your CTV ads might be struggling

39% of total TV viewing time now takes place on streaming TV. 4 in 5 US households have a video subscription service. And over half have a smart TV they use regularly.?

So it’s no surprise that 84% of global marketers said they would include streaming in their 2023 media mixes. Or that CTV ad spend will reach $25 billion by the end of the year. Promised the accountability of digital combined with the prestige and visibility of TV, marketers have eagerly tested streaming.?

But if the promise of streaming is true, why are performance marketers failing on the channel??

The Hidden Costs of Streaming

The biggest roadblock for performance marketers exploring streaming TV is simply cost.?

CPMs on streaming platforms are significantly higher than what can be achieved with linear TV. But that’s not all. Intertwined with the base cost of inventory are numerous fees, from third-party targeting costs to ad exchange fees to reporting fees.

Each added layer of cost drives up the overall price brands pay for media and makes it harder to drive ROI through streaming campaigns.?

The Problem with Precision

Targeting on streaming platforms isn't just about getting your ad in front of viewers; it's about getting it in front of the right viewers. One of the channel’s greatest draws is how it provides access to the same targeting methods digital advertisers use to reach ideal customers. But with streaming, there are multiple reasons a hyper-targeted approach could be short-sighted and even harm campaign results. This issue starts with the fact that granular targeting equals higher costs but becomes most problematic when reviewing the level of inaccuracy typically involved. In other words: advertisers pay more to reach the wrong people.

Measurement Missteps

Accurate measurement has always been a challenge for TV advertisers. Streaming was supposed to be the solution—greater visibility into the exact impact of every impression.?

But severe audience fragmentation means that’s far from reality. While the streaming industry is making strides toward a comprehensive approach to measurement, for now, it remains unstandardized. Plus, 8-10% of streaming impressions are delivered when a TV set is turned off. And a study by GroupM and iSpot found publishers overcount impressions between 2.5% and 15% across all CTV streaming activity.?

What’s the solution?

Navigating the world of streaming isn't only about acknowledging its challenges. And it’s definitely not about giving up—streaming has incredible potential that’s worth pursuing. But it does require harnessing strategies and technology to capitalize on that potential.

Download the free white paper below for four ways marketers can solve CTV’s challenges to drive accountable results. It’s time to turn streaming TV’s promise into reality.

Get the full report.