Did you know advertising on YouTube Connected TV (CTV) can lead to a 28% reduced CPM? The excitement around CTV is undeniably growing, but this doesn’t spell the end for linear TV advertising. Linear TV still commands a 48% share of ad spend when compared to CTV, social video, and online video combined.
However, this share is gradually declining. This raises an important question for media buying agencies: What path should they take? Should media buyers continue to specialize in linear TV advertising, or will media buying teams merge as CTV becomes a dominant force in digital marketing?
Are Advertisers Leaving Linear TV Behind and Moving to CTV?
Recent reports show a significant shift in advertising trends, with 63% of U.S. marketers leading their 2024 upfront buys with CTV advertising, compared to only 36% with linear TV. Additionally, 95% of advertisers plan to maintain or increase their ad spend in programmatic media buying for CTV ads in 2024. This shift is driven by several compelling reasons:
Flexibility in Ad Length and Format
Digital TV advertising platforms like Google and YouTube TV offer media buyers flexibility in ad length and format. For example, bumper ads are only 6 seconds long, perfect for brief brand messages that don’t disrupt the viewer’s experience. If a longer narrative is needed, ads can run up to 60 seconds.
Cost Efficiency and Targeting
Linear TV ad buying is based on ratings or estimated viewership. For instance, securing an ad spot during a prime-time show like a sporting event or the evening news often requires paying a fixed or higher price in bulk.
Rather than competing for ad spots during live sports coverage on linear TV, we focused on engaging the same sports audiences on YouTube. This improved cost efficiency significantly: a 13% increase in CPM for Non-Skippable ads and a 40% reduction in CPV for the brand’s Skippable ads.
Real-Time Adjustments
When advertising on linear TV channels, advertisers typically agree to specific stipulations concerning the placement and duration of their advertisements. The schedule is generally fixed, and adjustments like moving to a different time slot or show require prior notification and approval.
In contrast, advertising on Connected TV platforms such as YouTube and Google TV offers greater flexibility to media buyers. They can modify bids and schedules in real-time to optimize the performance and efficiency of video ads. This agility, enabled by performance data, allows for a more responsive and effective advertising strategy.
Knowing these advantages for media buyers, advocating for a complete shift toward Connected TV ads is tempting. However, we must emphasize the enduring relevance of linear TV advertising, and thus, should not be abandoned:
Synergistic Impact
- When digital advertising is complemented with TV advertisements, purchase intent experiences a 15% boost. In today’s market, digital and TV advertising complement each other, offering brands seeking promotion an effective strategy for achieving desired results.
- eMarketer’s report indicates that the average time spent on TV remains comparable to that spent on digital video advertising. This suggests that both linear TV and digital advertising remain powerful strategies. Combined, these strategies are superior to relying solely on a single advertising approach.
Check out our case study with a Quick-Service Restaurant (QSR) brand, where we achieved a 96% Video Completion Rate through a combined strategy. Further, we utilized CTV advertising due to its proven effectiveness as a medium, resulting in a 25% increase in efficiency.
High View-Through Rates
- Ads on linear TV channels consistently attain a high view-through rate (VTR) of over 90%, primarily because they do not have a skippable feature, unlike digital TV ad formats like YouTube TV.
- However, it’s worth noting that a significant portion, approximately 40% of the audience, frequently uses a second screen while watching TV. This presents an opportunity to leverage the advantages of digital advertising, especially on Connected TV.
- By capitalizing on CTV’s capabilities, advertisers can reach the same audience that engages with linear TV ads while offering interactive and personalized experiences.
Political Advertising Trends
- In the 2022 United States elections, digital political advertising was predicted to play a significant role, but traditional channels such as linear and connected TV advertising ultimately captured the majority of ad spend, accounting for over 50%.
- Looking ahead to 2024, forecasts indicate that linear and CTV ads will continue to dominate most political advertising spending, overshadowing social media platforms. While programmatic media buying is expected to grow, traditional advertising through linear TV remains a powerful force in political campaigns.
Given your newfound knowledge, what is your next course of action? While linear TV advertising will always have a place in the media landscape, are media buying agencies ready to embrace the hybrid advertising model that combines traditional and digital strategies?
Here’s our verdict:
Train your team specializing in linear TV advertising in digital TV advertising skills to keep them up to date. Embracing Connected TV, Google TV, YouTube TV, and other digital TV platforms broaden their opportunities beyond a single media buying strategy. This transformation increases their flexibility and empowers them with expanded capabilities, making them well-equipped to navigate traditional and digital advertising.
Why Media Buying Teams Should Focus on Learning Both Linear and Connected TV Advertising
We’ve emphasized it and’ll do so again: linear TV advertising remains prevalent. However, media buying agencies must also recognize the growing influence of digital advertising. Therefore, we affirm that as linear TV and connected TV solidify their roles as cornerstones of TV advertising strategies, your media buying teams should integrate both traditional and digital advertising expertise to maximize client outcomes:
Omnichannel marketing strategies are increasingly favored among marketers for their diverse approach across multiple platforms. Along with CTV, here are other preferred mediums by advertisers when placing ads on various platforms:
- social media (86%)
- display advertising (78%)
- mobile video (77%)
- desktop video (67%)
- linear TV (54%)
While we previously mentioned linear TV’s impressive view-through rates, 57% of media buyers affirm that Connected TV ads are more effective in driving website traffic and sales conversions. Furthermore, YouTube CTV ads exhibit a 14% higher view-through rate than mobile devices, suggesting a combination of linear and connected TV as an effective advertising strategy.
One compelling feature of CTV ads, particularly on YouTube TV, is the “Send to phone” option. This clickable button allows viewers to send the ad to their mobile devices, enabling them to engage further, visit the advertiser’s website, or purchase directly from their phones. This feature enhances the user experience and provides a convenient way for viewers to interact with CTV ads and take immediate action.
The steady decline of linear TV usage is becoming increasingly evident, albeit gradual. In 2023, viewership of traditional broadcast platforms reached an all-time low of just 49.6%, signifying a significant shift in audience behavior.
This decline coincided with the rise of digital TV advertising, as evidenced by the number of connected TV users. This trend will continue and intensify through 2025, indicating a fundamental change in how audiences consume television content.
Media buying teams now face the challenge of converting these shifting audiences into CTV ad viewers and potential consumers. If digital TV advertising is uncharted territory for your team, Strike Social is here to help.
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Through successful historical insights and cutting-edge technology, Strike Social delivers enterprise-level solutions tailored to enhance campaign performance on YouTube and Connected TV. Our strategies emphasize scalability and precise audience targeting, ensuring brands achieve heightened efficiency with reduced costs.
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Growing Your Customer Base with YouTube CTV Advertising
While mobile advertising remains relevant, adapting new formats like YouTube Connected TV (CTV) is important for broadening your brand’s reach. After all, having a diverse advertising strategy with multiple channels only enhances your chances of retaining and attracting new customers. Understanding the behavior of YouTube Connected TV audiences and determining effective strategies to convert viewers into consumers can be challenging. Yet, it presents significant opportunities for further exploration and potential growth.
Partnering with a dedicated social media advertising agency can provide valuable guidance and support. Our experienced team can help you develop a YouTube CTV advertising strategy that aligns with your other digital advertising efforts. We offer a personalized demo of our technology, specifically designed to assist you in achieving greater success with CTV advertising. Reach out to our team and take that step towards smarter advertising.
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