The upfronts and discussions about TV have become all about convergence issues — mix, budgeting and, more than ever, measurement and “currencies.”
This week, Innovid released a report offering direct input on such issues via surveys of 100 high-level executives, including 50 brand advertisers, 14 marketing ops execs, and 11 media/publisher executives. The respondents, 78% of whom had titles of VP marketing or above, were drawn from senior executives who are members of the Ascendant Network’s digital and retail communities.
With samples so small, there’s no claim that responses are representative of buyers or sellers as a whole. (Sample sizes are provided in charts.) Still, the report offers some interesting directional insights.
Reflecting the still-fragmented ecosystem, approaches to converged TV measurement vary widely. Thirty percent of these marketers reported using native measurement for each channel, 25% using a mix of internal and third-party partners, 18% each said they either use in-house measurement teams/tools or a single measurement partner across linear, CTV and digital video channels, and 3% use tools offered by networks/publishers.
Practices regarding the metrics used for the various channels are also divergent, with 45% reporting that KPIs are aligned consistently across linear, CTV and digital video, 30% using different metrics for each, and 20% struggling for uniformity.
However, there was some consensus among these marketers about being focused on high-level criteria such as brand lift and sales lift, and on asking publishers to focus on online and offline outcomes, as well as incremental reach, in providing metrics.
Forty-three percent of these marketers deemed a single currency to be extremely important, but 35% said it is just one of many factors influencing overall video/TV media buying, and 20% said it’s not affecting how they currently plan and buy.
On the other hand, asked about their plans for converged TV in 2023 (chart top of page), 68% said they would either slightly or significantly prioritize cross-platform measurement.
On the sell side, these publishers — 85% of which sell digital video, with the 57% that sell linear also selling CTV — reported that their ad inventory sales are about half driven by content and half by audience data. Publishers said online data, first-party data and third-party audience segmentation data are the types most-used by advertisers.
Nearly half (43%) of the sellers said they offer a single third-party measurement tool showing campaigns’ impact across video/TV delivery platforms, 28% offer their own tools, and the rest either use multiple tools or do not offer measurement themselves. Sellers agree that these varying capabilities are "the biggest barrier to getting advertisers to invest more across different TV platforms,” according to the report.
Budgets and Buying Decision Factors
Digital video still dominates budgets for all but the biggest brands, but connected TV (CTV) is indeed growing share. The largest brands reported still spending about 35% of their overall video budgets on linear TV, 30% on digital video, and 18% on connected TV (CTV). But among other brands, CTV and linear are in a dead heat — tied at an average 18% among the small organizations and 16% among the mid-sized ones.
CTV is largely used to fill audience reach and targeting gaps between linear and digital video, but its scalability is improving.
“There is scale in linear, but the momentum is shifting to CTV as the audience of cord cutters and cord-nevers continues to accelerate,” said a VP for an online retailer. “Combined with growing sophistication of the marketing stack, granular attribution, and creative testing capabilities, CTV allows companies to scale their growth while elevating their brand.”
Marketers ranked audience targeting, reach and outcomes as the top three drivers of converged TV buying decisions:
Seventy percent of brand-side respondents reported having increased CTV’s share of their overall TV budgets either slightly or significantly.
Several said investment in cable has been most affected, because using CTV’s online, first- and third-party data is now a better option for targeting niche audiences, and CTV targets viewers programmatically as they watch, instead of relying on programming content context.
“Over the past four to five years, the linear ratings challenge became significant,” observed a financial services’ firm’s head of media. “That’s when we realized we had to start to diversify our video mix in a more substantial way.As Roku and others became scalable solutions, we started to shift more and more of our linear spend to these partners to align with viewership trends.”
“First thing I do in every upfront cycle is work from a fresh budget and identify what tactics will best optimize reach,” said an SVP of video investment for an agency holding company. “Budgets for CTV are coming from a redistribution of allocations… from digital budgets, as well as from and social budgets.”
Converged TV buying is increasingly programmatic and centralized. While large brands still rely heavily on buying TV/video in advance via the upfronts/Newfronts, buying TV as needed via programmatic has become the dominant method by far for the smaller companies surveyed, and is also the most-used method for mid-sized companies.
“The budget for CTV originally came from our upper-funnel media budgets in digital,” said an EVP, marketing intelligence and consumer engagement for a beauty brand. “Most of it came from direct publisher buys. In those cases, we blended display, video and custom content on endemic sites. But we are not doing Newfronts for CTV; we are purchasing it programmatically.”
In addition, 80% of all of these marketer respondents reported buying converged TV media through a centralized team — supporting other research and anecdotal evidence indicating an evolution away from traditionally fragmented buying practices.
Next time, a look at marketers’ changing views and practices in the creative arena.
So, 17 "buy side" respondents felt that a single "currency" was very important but 14 said that having a single "currency" was one of many factors they considered and 8 said, in effect, that it has no bearing on how they plan or buy. Hmm? What interests me is what the one guy or gal whose answer was classified as "other" said. I wonder if he or she has a better answer?