More than half (56%) of marketer and agency executives say they plan to increase ad spend on connected TV (CTV) in the next 12 months, 42% will keep CTV budgets the same, and just 2% will decrease them, according to the first CTV Landscape report from Advertiser Perceptions.
The firm interviewed 306 advertisers (half marketers, half agencies) in May.
On average, buyers expect to dedicate one-third of their budgets to CTV.
“Advertisers are betting on CTV to solve fundamental marketplace challenges — from building reach in a fragmented market to offering addressability as other direct-to-consumer targeting options fade,” Erin Firneno, VP Business Intelligence at Advertiser Perceptions said in a summary of the results.
Three in 10 say they’ll increase their overall media budgets to enable greater CTV spend, and the rest plan to shift dollars from TV or digital video.
Advertisers perceive YouTube (including YouTube ads for CTV apps/screens and YouTube TV) and Hulu to be the CTV market leaders, with Amazon Advertising (including IMDb TV and Fire TV) third and Roku fourth. All four leaders had 20-point-plus leads over the rest of the field.
At the same time, 58% of advertisers think that mid-tier publishers are essential to keep overall CTV campaign costs down, and 54% believe they can achieve reach goals by bundling mid-tier options. But six in 10 say they encounter greater brand safety and/or fraud concerns with mid-tier publishers.
Programmatic buying and demand-side platforms (DSPs) are increasingly important to CTV buying.
At present, 70% report buying CTV ads from device manufacturers, 64% from advertising video-on-demand (AVOD) platforms and 63% from virtual multichannel video programming distributors (vMVPDs). But over the next 12 months, that will shift to 71% with AVOD, 70% with device manufacturers and 62% with vMVPDs, according to the survey.
Fully 92% report buying some CTV ads programmatically in the past 12 months. The most-cited benefits are better pricing, easier campaign optimization, easier to achieve scale and ability to activate video campaigns from a single platform. The most-cited challenges are lack of transparency as to which publishers air the ads, less control over the ad buy, brand safety concerns, and lack of transparency in ad-tech fees.
The survey also confirmed that agencies, due to their roots in linear TV, are less likely than marketers to view digital video as the most important media type and more likely to have purchased linear in the past 12 months and to use linear budgets to fund CTV.