Back to the future: Harnessing the potential of CTV
Steve Martin, MD international data and TV at LiveRamp stands at the cross-roads for Connected TV in the UK and advises marketers on accessing the space
Digital marketing has witnessed a decade of fast-moving innovation and technological advances. The explosion of our online activity - from social media to online shopping – has created an ecosystem whereby digital marketing can now take place across every device: laptop, mobile and TV, for example.
Our access to - and the availability of - data has skyrocketed, as have our digital capabilities. Because of this progress, there is also an assumption that the technology and strategies we employ today are far more advanced, complex and sophisticated than they have ever been in the past.
While it could be said that technological progress has encouraged some marketers to favour reach and scale over relevance and precision, there are solutions available today that can potentially enable them to achieve both scale and precision targeting, without sacrificing one or the other.
To this point, the rise of Connected TV is creating the perfect environment to hone the practice of combining scale and precision into one.
CTV is at a crossroads in the UK and requires a new strategy from marketers entering the space.
On the one hand, it is still a relatively new market - probably lagging 18 months to two years behind the U.S in terms of market maturity. At this time of economic uncertainty, it can be tempting for marketers to stick with what they know, cautious of investing in CTV for the first time.
On the contrary, CTV is an opportunity too good to ignore - it is on an impressive trajectory and has the potential to make a serious impact.
According to recent research by Unruly, 82% of the UK population now have access to CTV through at least one connected device.
CTV is particularly interesting to marketers because of its ability to transform the last bastion of above-the-line advertising spend – television – into a hugely measurable and addressable channel.
The potential of TV is exciting. The longevity of TV as a marketing medium is an attractive facet to traditional marketers who are not fully engaged with digital, whilst the scale of reach, not only in number but the level of engagement of viewers, mean that investment in the space will be met with high ROI.
It may not be obvious but CTV has some real similarities to direct mail; the cost per “impression” is relatively high, the unit of targeting is often the household, there is scope for rich creative, and there is the possibility of doing robust testing versus control lift measurement at the individual level.
Successful strategies in CTV may well end-up looking very similar to those that prevailed in direct mail - highly targeted, using sophisticated analytical techniques, and robustly measured.
This doesn’t mean we shouldn’t capture some of the successful strategies from digital in terms of buying process and creative innovation - it is just to say that a blend is probably what is right for CTV.
Reframing the use of CTV as your “TV Sandbox” can be a helpful mindset.
Many marketers are currently somewhat frustrated by the scale and cost of the CTV channel. They don’t believe it is possible to make it commercially viable.
This might be understandable given how young the UK market is, but if we look to the U.S, the debate around commercial viability has already been settled - the CTV market has matured significantly and should be a sign of the positive opportunities to come over here.
Marketers should focus more on the unique measurability of CTV within the TV ecosystem.
For the first time, it is possible to link viewing data at scale with robust outcome data such as sales, and also to set-up proper test-and-control groups at a household level.
This makes CTV the perfect place to learn about what works in TV more generally in terms of creative, placement and audience.
Miles Pritchard, managing partner at OMD, has some thoughts on how this might work. He says: “There are challenges at the moment for advertisers looking to scale their advertising initiatives - third-party cookies are on the way out and authenticated users are at a premium. Brands need to think laterally about how broader activation can be achieved by applying CRM insights and segmentation.
“For instance, customer insights can be generated through traditional CRM processes such as factor analysis, clustering, LTV (lifetime value), and audience modelling. From here we can overlay additional data sets such as census, demographic composition and housing price. Finally, we can put these insights into action through contextual signals in the bid request (digital) and postal code, day-parting and the likes for other offline channels.”
These learnings can then be applied to linear TV strategies where they can currently have greater economic impact.
It doesn’t hurt that by treating CTV as a testing environment, marketers will naturally be learning about a channel which is likely to become increasingly important over the next few years.
To make progress in CTV, it may be a case of going “back to the future” and looking to the strategies that dominated CRM 15 years ago.
It makes sense to see CTV as a learning environment that can influence broader TV strategies, as well as preparing to make the most of a fast-growing and exciting channel.
Marketers can make the most of the opportunities ahead by investing now, dedicating a solid percentage of budgeting to exploring CTV - for example 10% - , and seeking to become leaders in the new market.