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Unleashing the Power of Connected TV: A Comprehensive Guide to Boosting ROI

Connected TV (CTV) has emerged as a dominant force in the advertising landscape, captivating audiences with its immersive content experience. However, despite its rising popularity, many marketers still underutilize the full potential of CTV, missing out on significant returns on their investments. In this comprehensive guide, we will explore effective strategies and tactics to help marketers boost their ROI in the CTV realm

Connected TV (CTV) has seen significant growth in recent years, but a new report reveals that many marketers are not fully capitalizing on its potential. According to a study by Analytic Partners (AP), CTV accounts for only 7% of total marketing spend, despite offering a 30% higher return on investment (ROI) compared to other channels. The study suggests that this underutilization is due to marketers’ false beliefs about the difficulty of attributing and measuring CTV’s impact. While many digital channels provide immediate performance metrics, CTV’s influence on consumer purchasing decisions lasts longer and has a greater impact.

CTV is transforming the living room television experience and providing marketers with a data-rich platform for advertising. By 2026, it is estimated that 1.1 billion households worldwide will own a smart TV, offering brands a vast audience and data-driven advertising opportunities. As brands leverage data to align their marketing touchpoints, CTV’s potential will be realized, allowing them to build awareness and drive outcomes. The inclusion of a direct response element in CTV will ensure that its true ROI impact is recognized.

Currently, CTV is primarily used for branding purposes, with over 70% of marketers focusing on awareness and views as measures of success. However, performance metrics are gaining traction, with almost half of marketers citing engagement as a key performance indicator (KPI). Despite this, only a minority of marketers are actively utilizing outcome-based metrics such as return on advertising spend (ROAS).

The demand for performance metrics in CTV is driven by new advertisers who find traditional linear TV too expensive. By leveraging technology that allows customer relationship management (CRM) data to be extended into TV, smaller direct-to-consumer (D2C) brands are taking advantage of digital targeting parameters that go beyond linear TV capabilities. This shift is making CTV an exciting and valuable environment for performance-oriented advertisers.

To support these advertisers, TV hardware manufacturers are starting to offer outcome-based ad buys. For example, LG recently announced plans to provide brands with a guaranteed level of performance from their CTV advertising, backed by third-party verification to deliver transparency and confidence. This represents an opportunity for brands to focus on delivering ROI by using media that drives results.

QR codes are also experiencing a resurgence in CTV advertising, boosted by the familiarity consumers gained with them during the pandemic. With 79% of people having their phone or another device in their hands during ad breaks, using QR codes on CTV seems to be a logical choice. New dynamic QR codes designed specifically for CTV are emerging, and it is predicted that the number of US smartphone users scanning a QR code will rise to 99.5 million by 2025. When brands offer additional digital signals indicating engagement, interest, and attention, CTV becomes further integrated into the consumer’s journey.

However, not everyone is convinced that QR codes are the future of CTV advertising. Some predict low hit rates as living rooms are not conducive to photographing the big screen. Despite this, most believe that CTV ads will incorporate QR codes, although nearly half of them believe that something better is needed.

Integrating CTV into the overall marketing channel mix is crucial for marketers. With the demise of third-party cookies, relying on trustworthy data sources and collecting first-party user data becomes paramount. However, it is not just about first-party data; activating second- and third-party audience data is critical to access audiences that linear TV cannot reach across all screens.

Marketers are increasingly looking to shift from viewing CTV as a separate medium to one that can be seamlessly integrated into their omnichannel marketing strategy. This integration allows for more effective campaigns and offers opportunities for leveraging universal IDs to match audiences to viewer data. By closing this loop, omnichannel strategies become more targeted and personalized, maximizing the impact of CTV advertising.

One of the challenges marketers face with CTV is the measurement and attribution of its impact on consumer behavior. Traditional methods of measuring TV ad effectiveness, such as surveys and panel data, may not provide accurate insights into the performance of CTV campaigns. However, advancements in technology and data analytics are enabling more sophisticated measurement capabilities.

Advanced analytics platforms and tools are emerging to help marketers accurately attribute conversions and measure the ROI of CTV advertising. These solutions leverage data integrations, machine learning algorithms, and probabilistic modeling to connect CTV ad exposures with consumer actions, such as website visits, app downloads, and purchases. By understanding the full customer journey and attributing conversions to CTV ads, marketers can gain valuable insights into campaign performance and optimize their strategies accordingly.

Another area of focus for marketers is targeting and personalization in CTV advertising. With the ability to gather data on viewer demographics, interests, and behavior, CTV offers a wealth of targeting options to deliver relevant and personalized ads to specific audiences. Marketers can leverage this data to create audience segments and tailor their ad creative, messaging, and even ad sequencing to resonate with different viewer groups. By delivering highly targeted and personalized ads, marketers can enhance engagement, increase conversion rates, and drive better overall campaign performance.

In addition to targeting and personalization, interactive and immersive ad experiences are gaining traction in the CTV space. With features such as interactive overlays, shoppable ads, and interactive games, marketers can engage viewers in a more interactive and participatory way. These interactive elements not only capture viewers’ attention but also provide opportunities for direct engagement and conversion. By incorporating interactive elements into CTV ads, marketers can create memorable experiences that drive brand awareness, consideration, and action.

As CTV continues to evolve, marketers must stay informed about the latest trends and best practices to effectively leverage this channel. Collaborating with CTV platform providers, ad tech partners, and data analytics experts can help marketers navigate the complexities of CTV advertising and unlock its full potential. By embracing CTV as a valuable component of their marketing mix, marketers can reach a growing audience, deliver targeted and personalized experiences, and achieve measurable results.

In conclusion, the underutilization of CTV by marketers presents a significant opportunity for those willing to embrace this channel. With its higher ROI, data-rich environment, and growing audience, CTV holds immense potential for brands to connect with consumers and drive business outcomes. By adopting advanced measurement and attribution techniques, embracing targeting and personalization, and exploring interactive ad experiences, marketers can optimize their CTV advertising strategies and maximize their impact in the evolving media landscape. As the CTV ecosystem continues to mature, it is essential for marketers to adapt and integrate CTV into their omnichannel marketing strategies to stay ahead in the competitive digital advertising landscape.

Pesach Lattin
Pesach Lattin
Pesach "Pace" Lattin is one of the top experts in interactive advertising, affiliate marketing. Pesach Lattin is known for his dedication to ethics in marketing, and focus on compliance and fraud in the industry, and has written numerous articles for publications from MediaPost, ClickZ, ADOTAS and his own blogs.

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