While linear TV spend still far outdistances CTV/OTT, many of these ad-tech suppliers, publishers, platforms and other industry players — who, admittedly, have considerable skin in the game — do argue that the trend is tilting toward the net-driven platforms.
David Cohen, CEO, IAB: “Outside of sports, all signs point to us living in a streaming world. This does face an upper limit, however: Households will not be able to afford to subscribe to it all — which is actually a great thing for advertisers. Free ad-supported TV (FAST) will be a major factor in streaming’s future.”
Ivan Markman, chief business officer, Verizon Media: “Fierce competition and the explosion in consumer engagement opportunities have made CTV the epicenter of ad sales. Next year, we’ll see major brands radically alter their ad spend from the TV upfront in favor of more flexibility and greater investment in streaming and CTV. One side effect: Managing CTV campaigns has become more of a challenge, and buyers will need more clarity.
For buyers to take full advantage of opportunities like deeper integration of native formats, dynamic ads, AR, audio and more, they’ll need to be able to access inventory programmatically, alongside other media types, including desktop, mobile, DOOH, audio, XR and beyond. Technology platforms will also have to make it easier to plan, buy and manage TV inventory types alongside one another.
While ad-tech makes omnichannel purchasing possible, most planning and buying is still done channel by channel. It’s time for agencies to embrace more efficiency and collaboration. 2021 could be the year when siloed buying and planning teams are unified and operate in an omnichannel way.”
Sarah Warner Harms, group vice president, buy-side sales, Xandr: “While accelerated by the pandemic, we see the rapid shift in video viewing habits as a long-term trend that will only build in 2021. To continue to meet the needs of consumers and achieve business results, buyers will have four core areas of focus: direct paths to premium supply, a need for transparent context, effective reach across screens and standardized measurement.”
Holly Rae, vice president, product, TV platform, Xandr: “As the industry continues to home in on the importance of a converged platform offering, the first step is making data-driven linear transactions easier to execute, and with greater consistency, across the marketplace. In 2021, this transformation will evolve further, as targeting beyond age and gender become even more important and brands, agencies and holding companies continue to invest in data-driven solutions.”
Frost Prioleau, co-founder and CEO, Simpli.fi: “Agility became one of the most important pages in a marketer’s playbook this year, and that will continue in 2021 and long past the COVID-19 pandemic.
In the past, linear TV advertising was typically associated with the ‘set it and forget it’ budget approach, leaving little wiggle room for changes, and saddling advertisers with limitations — especially when it came to targeting. But this year, advertisers moved away from the rigidity of linear TV advertising, and challenged linear and other traditional media to provide the same flexibility offered by digital platforms.
In addition to precise targeting and rapidly increasing scale, agility is one of the reasons that CTV advertising saw such strong growth in 2020. In 2021, advertisers will continue to invest in CTV and other digital platforms — not only to reach homebound consumers, but to combine the flexibility and precise targeting capabilities of digital with the impactful storytelling of linear.
Savvy performance marketers, who were early adopters of CTV advertising, will also shift more of their budgets toward this channel. As they lean into their digital strategies and allocate budgets for this nontraditional, ecommerce-focused holiday season, CTV advertising is playing a significant role — setting the tone as the industry moves into 2021 and beyond.
These marketers have been seeing strong ROI — whether it’s in-store foot traffic or website conversions — through CTV’s targeting and attribution capabilities. CTV can also reach specific audiences that are likely to convert at lower effective CPMs than the cable TV spots used by many performance marketers, driving performance and a higher ROI.
We also see CTV democratizing TV advertising for brands and agencies of all sizes. CTV allows for lower campaign spend minimums than traditional linear, and reduces waste by targeting specific households in an advertiser’s surrounding area or nationwide. It also provides direct attribution to website conversions and increased foot traffic to an advertiser’s location — providing accurate performance reporting even on small budget campaigns.”
Daniel Elad, chief strategy officer, The Viewpoint: “We should see more cross-device measurement solutions in the CTV space next year, thanks to the Unified ID 2.0 initiative bringing a standard identifier to the ad industry. Also, some measurement tools — QR scan codes, for instance — will migrate to CTV from 'performance' ad units.
In addition, as both the buy and sell sides seek greater transparency and profit, the overcrowded CTV programmatic ecosystem will boost the necessity for supply- and demand-path optimization. Specifically, by leveraging more direct deals and operating through PMPs, publishers will increase their inventory efficiency, DSPs will reduce their queries per second and costs, and brands will get more transparency and control over their ad dollars.”
Andre Swanston, CEO, Tru Optik: “If there’s one takeaway from 2020, it’s that free OTT services exploded as consumers were forced into lockdown and will continue to grow as we head into 2021. All major media companies have launched an OTT streaming service and will make ad-supported tiers the foundation of their monetization strategy, as consumers look to supplement pay connected TV with free options.
Free ad-supported TV (FAST) will become the de facto standard of how consumers watch content. Because of this, there will greater demand for targeted advertising leveraging first-party and third-party data, which will make identity resolution graphs more critical than ever.”
Tal Chalozin, chief technology officer, co-founder, Innovid: “The growth of CTV adoption and time spent isn’t done yet. We anticipate a big boom this holiday season, when more consumers purchase connected TV devices.
By the time the pandemic is over, people who switched to streaming due to a lack of sports won’t need to switch back, because streaming providers and the leagues will have negotiated content deals. For example, Peacock will stream tons of sports, including the next Olympics.
Because of this consumer shift, we’ll see advertisers continue to invest in CTV. The strategy behind buying prime-time TV hasn’t changed: Advertisers still want to associate the brand with premium content and reach big audiences. But advertisers will now purchase CTV inventory to achieve those goals. This has already started: From January through November, we saw a 58% YoY increase in impression growth in CTV, with 87% YoY impression growth in November alone.
CTV programmatic buying has also accelerated. A year ago, the percentage of CTV media bought programmatically was in the mid-teens; now, it’s nearing the mid-twenties. Innovid has seen a 207% YoY increase in impression growth in programmatic-based inventory. In 2021, programmatic buying on CTV will become the norm. It will be data-driven, audience-based and use technology and automation.
Marketers will continue to focus their ad spend on showing action-based outcomes like website traffic, add to cart, absolute shopping and app downloads, and continue to move away from KPIs like reach and completion rate. The main problem is that marketers must know identity across media, sites and devices for that to work. To address this, we will see big progress in creating a uniform standard for CTV identification in 2021.
Right now, streamers are relying on content to drive subscriptions. But there’s a limit to the original content that streamers can create, and in 2021, people will start to question whether they need so many streaming subscriptions. At some point, the economics won’t work. Streamers are going to hit that inflection point sometime next year. We’re moving toward an era in which distribution will be more important than content. People will buy devices to serve their needs, because they’ll watch what’s available. When that happens, device manufacturers will be the new distributors and will have the upper hand in negotiating content and distribution.”
Jeroen Wijerling, co-founder, chief Innovation officer, JW Player: “After the rapid growth of the past year, OTT is primed to overtake linear TV viewership in 2021. Even beyond the big five — Netflix, Hulu, Disney+, HBO and Amazon Prime Video — OTT will be the primary way that TV brands of all sizes will reach their audiences next year. TV brands with niche content and loyal followers are particularly well positioned to grow their audiences through standalone OTT apps. To keep up with demand, media companies will need frictionless, scalable workflows to publish content and optimize it with analytics.”
Jon Skogmo founder and CEO, Jukin Media: “Multiple signs — including big jumps in year-over-year streaming viewership and ad revenue — point to a lasting shift to CTV as more consumers embrace it and brands continue to move more ad dollars its way. Low-cost and free streaming services have become an even more attractive option for budget-conscious consumers. We believe 2021 will see more content optimization by channel. To optimize performance, creators must understand the specific audience for each platform and tailor content based on length and mobile formats for different viewer experiences.”