CTV for CPG Brands: A New Era of Targeted, Measurable Marketing
By: Jenna Bennett
The barriers that have historically hindered investing in Connected TV (CTV) as part of an omni-channel campaign are beginning to dissipate.
Connected TV (CTV) refers to devices that can stream video content over the internet, typically directly to a television. This includes smart TVs, streaming media players like Roku and Fire TV, gaming consoles like PlayStation / Xbox, and fresh players like Walmart’s purchase of Vizio to create a content delivery to rival Amazon.
A Digiday survey of over 100 brand marketers and agency executives reveals that more than half (52%) say they started to shift media investments to CTV more than a year ago, while 48% are still testing or haven’t started yet. Those who are reticent cite more familiarity with linear TV’s broad reach and familiar marketing mix approach.
What we see through our partnerships with agencies and brands is that once they better understand how to analyze CTV results, they embrace the shift from linear TV and lean into its many advantages and innovations.
CTV targeting: More sophisticated than you might think
CTV offers far more precise targeting than traditional TV, enabling performance marketing across the entire customer journey. By focusing on households versus IP addresses, you can refine your targeting and eliminate wasted spending.
Look for companies like Catalina that use purchase-based insights and AI/machine learning-enhanced algorithms to predict your most likely buyers. This extends your reach beyond current brand and category buyers to all relevant shoppers, ensuring optimal effectiveness. And these real-time purchase insights help you stay ahead of evolving consumer behavior trends.
CTV builds measurable awareness, drives conversions
Like linear TV, you can use CTV to build measurable awareness, but don’t stop there. Unlike linear TV, you can uncover in real-time what’s driving conversion.
We’ve begun to see marketers shifting their focus to more complex metrics to gauge the effectiveness of their CTV campaigns. While IAB Tech Lab released open measurement technology for CTV in 2022, suppliers and app adoption has been slow.
‡This is expected to accelerate as more large platforms like Samsung and LG become part of its measurement tool, bringing total coverage to 40% of the market.§
This will make it easier to identify insights into sales impact and the behaviors of the buyers who were exposed to specific media channels.
CTV creates greater operational scale
With CTV, you can also operate on a much larger scale. CTV is poised to overtake linear TV in 2024, challenging traditional SVOD for attention and ad dollars. It’s estimated 115M US households use connected TVs at least once per month, with that number projected to grow to 121M by 2027.
Free Ad-supported Streaming TV – called FAST – has grown tremendously this year, offering wider audience reach at potentially lower costs. A FASTMaster report revealed there are now about 2,000 unique FAST channels in the US and the market continues to grow month-to-month.‡
FAST channels mimic the traditional channel-based viewing experience by offering pre-programmed content – often consisting of a library of shows and movies. This shift is redefining premium content, allowing brands to not only focus on context but also truly understand who is ingesting specific programming.
As more consumers become frustrated with rising subscription fees and shift to ad-supported platforms, two key benefits emerge: Reach and targeting improves and more inventory drives down costs.♦
Three out of four (73%) of connected TV viewers prefer to watch free ad-supported content versus paying more for ad-free content. More than half (55%) of consumers use at least one free ad-supported streaming TV (FAST) service, such as Pluto TV, The Roku Channel, Tubi, Amazon’s FreeVee, or the free version of Peacock.º
To learn more about how CTV can sharpen your omni-channel strategy, consult with Catalina’s data experts on how to:
- Rebalance your linear and CTV budgets
- Use real-time, purchase-based targeting
- Leverage CTV for reach and frequency control
- Focus on performance vs. awareness
- Capitalize on the shift from paid to free subscriptions
§IAB Tech Lab, 2024
‡TV Tech, US FAST Channels Hit Record Numbers (2024)
♦Futureproofd
ºHub Entertainment Research study