It’s no surprise that consumers across the world are cutting the cord to cable due to the increased popularity of streaming services and the accessibility of OTT and CTV. In fact, in July 2022, the leading streaming services drew more viewers than cable TV for the first time and it’s expected that in 2023, cord-cutters will outnumber cord-nevers, those who have never paid for a traditional cable plan. It’s clear that more and more consumers are looking for flexibility and a better viewing experience while watching their favorite shows – luckily streaming platforms can provide both.
In this article, we’ll dive into everything you need to know about Connected TV (CTV) including what it is, how marketers can benefit, and top CTV statistics.
What is Connected TV?
CTV stands for “connected TV” and includes televisions that are used to stream content over the internet. This can include both smart TVs as well as devices that hook up to TVs like Firesticks, Roku, Apple TV, etc. It is important to note that CTV and OTT, while similar, are not the same. OTT refers to any content that can be streamed from devices like TVs, phones, tablets, etc., while CTV is specific to TVs that connect to the internet.
Some examples of CTV devices include:
- Smart TVs – Smart TVs have streaming capabilities (apps) built into their system
- Gaming Consoles – Gaming consoles like Xbox, Playstation, and others also give users the ability to connect to the internet and apps to stream television
- Other Media Streaming Devices – Other media streaming devices can hook into a television, essentially turning a TV into a Smart TV where users can watch their favorite shows via app. Examples include: Amazon Fire Sticks, Apple TV, Roku, and more
How Marketers Benefit from CTV Advertising
Consumers aren’t the only ones flocking to CTV in droves. Marketers have seen the opportunity that CTV is presenting from an advertising perspective as well. CTV advertising can solve a host of common marketing challenges and benefit both marketers and consumers. Let’s briefly dive into a few benefits of CTV advertising.
Easily Target Consumers With CTV Ads
With CTV advertising marketers have the opportunity to precisely target consumers like never before. While privacy is a top concern for marketers in the current climate, the TV screen is becoming one of the most targetable devices in an advertiser’s toolkit. Considering TV has never had cookies or IDFA to begin with, their deprecation doesn’t affect TV targeting in the same way.
Today, most streaming platforms allow marketers to target against interests and behaviors, demographics, location, and custom audiences (based on first and third-party data sources). These vast targeting capabilities ensure marketers can reach their intended audience through their CTV campaign efforts. As a bonus, if you embrace a cross-channel approach to CTV advertising, you can target and retarget the same audience across multiple channels and screens.
Brand targeting and relevance are more important than ever considering:
- 40% of viewers will stop watching CTV if there are too many ads, but they are willing to watch up to 5.8 ads if they are relevant to the viewer (Source)
- 86% of consumers are willing to see ads on CTV, especially if they are relevant to them (Source)
- CTV now reaches two out of three US viewers, and daily CTV usage has grown by over 100% since 2017, per Nielsen research (Source)
CTV Advertising Increases Brand Awareness
Marketers who have incorporated CTV advertising into their strategy have seen positive results, including an increase in overall brand awareness. A brand lift study, conducted by Kantar, found that CTV ads boost brand awareness by 19%. An Innovid and Digiday report also found that 59% of advertisers said investing in CTV advertising raised their brand awareness. If you’re looking to increase your brand awareness in the market, you might want to consider adding CTV advertising to your strategy.
Measure the Success of CTV Ads
There is a huge myth in the streaming world that non-click-based media is impossible to track – making it difficult or impossible to measure TV ads. This notion is simply false and with a variety of metrics to analyze, it’s completely possible, and necessary, to track the success of your CTV campaigns. In our current day and age, we have the ability to measure results in real time in order to adjust targets and optimize campaigns as needed.
But do CTV campaigns actually work? What types of consumers are likely to engage in these marketing efforts? Let’s take a look at the numbers.
Audience Statistics for CTV
The growing popularity of CTV is simply undeniable. In fact, 87% of U.S. adults own a connected TV, and 46% watch daily. But who exactly are the consumers watching CTV? Let’s take a deeper look at the demographics.
Demographics of CTV Viewers
CTV streamers come in a variety of ages and backgrounds. Let’s examine some common demographics for CTV users.
- Most CTV viewers are between the ages of 18 and 34 years old (Source)
- Four in 10 US senior citizens are CTV users—whereas CTV usage is about double that, more than 80%, among those ages 25 to 54 (Source)
- Even boomers prefer streaming to cable, with 40% spending most of their video viewing time with those digital services (Source)
Millennial and Gen-Z CTV Viewership
Millennials and Gen-Z have embraced CTV at extremely high rates. Let’s take a look at this demographic and how they contribute to overall streaming numbers.
- The number of CTV users came in at more than 110 million among Gen Z and Millennials (Source)
- One in four Gen Z Roku users discover new products or brands from TV streaming ads and 35% say they have purchased a product or brand as a direct result of seeing streaming ads (Source)
- The number of millennial connected TV users in the United States is expected to hit 62.6 million by 2025 (Source)
CTV Audiences Outside of the USA
The popularity of streaming is a worldwide phenomenon, not just limited to U.S. consumers. Let’s examine CTV audiences outside of the USA.
- About two-thirds of the UK population watches digital video on a CTV (Source)
- CTV users in the US were from predominantly older age groups, while in the UK, users from the 25-44 age group were leading (Source)
- CTVs are now on an upward curve in India, with 12-14 Million monthly active CTV users (Source)
- More than 50% of advertisers and nearly 100% of agencies in Europe cite CTV/addressable as a key growth area for digital video over the next 12 months (Source)
Marketing Spend Statistics for CTV Advertising
As the adoption of CTV grows worldwide, marketers have shifted significant efforts and large budgets of advertising spend into the streaming sphere, and for good reason.
- The CTV market is expected to grow 14.4% in 2023 and will grow faster than the overall advertisement market (Source)
- Connected TVs drew 33% of streaming video ad budgets in Q2 2022, up from 28% a year earlier. For standard ads, CTV accounted for 53% of spend in Q2 2022 (Source).
- In 2019, Roku, Hulu, and YouTube made up 45.9% of the US CTV ad market. Now, they’re down to about one-third (Source)
- In 2022, CTV advertising spending in the United States was valued at 21.16 billion (Source)
- 76% of video buyers considered CTV a “must buy” in their media planning budgets (Source)
- eMarketer now predicts CTV ad spending will exceed $26 billion in 2023 (Source)
Interested in learning more about CTV or additional forms of video and streaming advertising? Visit our Performance Streaming services page, download our Ultimate Guide to Performance Streaming, or contact us today to chat with an expert.