Study: Advertisers favor CTV buys with established media outlets over streaming startups

Dive Brief:

  • The biggest advertisers this year plan to spend more on video, favoring the connected TV (CTV) options of established networks over streaming startups, according to survey results that researcher Advertiser Perceptions emailed to Marketing Dive. Most advertisers plan to keep their media allocations consistent this year, spending 40% for upfront and 60% for scatter, the survey found.
  • Concerns about advertising fraud, especially in programmatic auctions, are driving the biggest advertisers to favor linear TV and the growing CTV options established networks. Those advertisers seek the same assurances from CTV that they receive from linear TV, demanding that ads appear on reputable sites (87%), pair with brand-safe content (80%) and run within professionally produced video content (79%), the survey found.
  • The research comes as the advertising industry prepares for upfront presentations by networks following significant turmoil last year for the annual events that saw P&G announce plans to not return.  As the video audience grows more fragmented, measurement has emerged as the biggest concern for advertisers. More than half (58%) said the more impressions they buy outside of linear TV, the harder it is for them to measure reach, frequency and effectiveness of their video advertising. 

Dive Insight:

As millions of U.S. households connect their TVs directly to the internet, marketers are looking for ways to reach consumers who are spending more time streaming content directly from internet platform or watching via a CTV service as video consumption, overall, remains strong. About half (52%) of video advertisers plan to increase their video spend this year, while the remainder will keep it at the same level. Among the advertisers that will boost spending, about three quarters (77%) said their video ad budgets are growing faster than for other media channels. Advertiser Perceptions surveyed 284 advertisers and agencies in November and December, and asked 300 advertisers about their upfront buying plans in January.

However, increased fragmentation in the viewing opportunities for consumers is causing concerns for some advertisers, who want media partners they can trust, such as CTV services from established networks, amid concerns about online fraud. The finding indicates that advertisers and media agencies want the flexibility to allocate their spending among linear TV and digital video channels as viewers seek out their favorite programming among more choices of media outlets.

At the same time, advertisers want CTV to provide some of the same customization capabilities offered by online video. Seventy-five percent of advertisers want to learn more about how media companies plan to balance expanding reach with innovation in personalization and cross-screen measurement, the survey found.

“Big TV networks have really beefed up their CTV opportunities at the right time,” Justin Fromm, executive vice president of business intelligence at Advertiser Perceptions, said in a statement. “They’re becoming safe harbors for the largest advertisers as fraud climbs in the medium. While the major internet platforms will lead in volume of streaming ads, TV network safety is keeping them the gold standard in video as the platforms evolve.”

While viewership of linear TV has declined as streaming has become more popular, 51% of advertisers said linear TV is their top priority, compared with 16% for social media and 15% for video sites. Advertisers that spend $25 million or more a year prefer linear TV, while marketers that spend less describe social media and video sites as more effective. That finding is consistent with the strategy of social media companies like Facebook to provide smaller businesses with more focused targeting by region, demographic group or personal interests.

The Advertiser Perceptions survey comes amid increased consolidation of the CTV advertising landscape. Magnite this month agreed to buy rival SpotX for $1.17 billion in cash and stock, creating the biggest independent CTV and video advertising platform in the programmatic marketplace. ISpot.tv last month acquired Ace Metrix in a deal that combines the providers of complementary measurement services for TV advertising.

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