In the CTV Era, Ad-Supported Content Has A Bright Future

This article is sponsored by Tremor Video. To learn more about the future of ad-supported CTV, read Tremor Video’s Evolving Living Room guide.

TV viewership is on the move – driven by an influx of connected TV (CTV) subscription services that have redefined the way viewers consume and pay for content. While the early transition to on-demand content was led by the comprehensive libraries of Netflix and Amazon, since then the market has become heavily saturated by new paid offerings with expensive original content.

As viewers rush to connected screens and on-demand content in the evolving modern living room, advertisers have tried to follow close behind. However, a growing number of ad-free pay-TV subscriptions have made CTV advertising opportunities difficult to accumulate in meaningful ways.

This has created an inflection point for CTV viewership, as viewers approach their limit for pay-TV subscriptions. The average household is now only willing to pay $38 per month for subscription content – according to a 2018 Magid study. At the same time, Pay-TV subscriptions are experiencing an average annual decline of 4.8%, according to a MoffettNathanson study.

“We’re starting to see that consumers are getting frustrated with being asked to pay for 5-6-7-8 different services,” said Devin Fallon, VP of media insights and analytics at Tremor Video. “When they hit their cap, our best bet is that they are going to begin to supplement the rest of their viewership with ad-supported streaming models that offer a breadth of content that many of the top streaming platforms no longer offer.”

It turns out CTV viewing behavior isn’t that different from linear, and viewers are willing to see ads in order to have free access to the content they want to watch. Seventy-three percent of OTT viewers report they still watch ad-supported content, while 45% watch ad-supported content more than any other streaming video type, according to an IAB study. As a result, ad-supported video-on-demand (AVOD) can deliver advertisers the CTV opportunities they are looking for to drive meaningful engagement with consumers they might be missing through linear and live TV campaigns.

“It’s too soon to tell what the brand loyalty will be like for a single ad-supported platform,” Fallon said. “But what we have already seen is that these platforms are becoming more integrated with TV operating systems to the point where they can help viewers navigate all the different locations to find and view content – from free ad-supported, to rental or subscription access.”

He added, “We are going to see viewers choose the path of least resistance and select the ad-supported option that gives it to them for free.”

What Does This Mean for Advertisers?

For advertisers who choose to capitalize on the ad-supported future of CTV, access to this valuable in-stream inventory – combined with the right creative – can help drive more powerful, effective, wide-reaching campaigns:

  • Higher ad engagement: Increase ad recall and interest with ad-supported inventory. Tremor Video’s in-app pre-roll inventory can deliver a 22% lift in purchase intent. Additionally, the video completion rate is 95% and 73% of viewers can recall AVOD ads without help.
  • Extended audience: Find audiences who don’t view TV content through traditional live linear methods. Ad-supported content can be used to engage cord cutters and also light TV viewers. When paired with its wide array of third-party data partners, Tremor Video’s robust ad inventory can help advertisers focus a campaign specifically for CTV viewers or extend linear TV campaigns to retarget viewers.
  • More precise targeting: Engage better qualified behavioral audiences at scale through the unique advantages of Tremor Video’s strategic data and content partnerships – while leveraging powerful ad placements at both the OEM and app level.
  • Creative that stands out: Take advantage of the less saturated, lower ad-to-content ratio on CTV. In addition, Tremor Video’s content studio can create quality interactive experiences for CTV screens that drive engagement – from in-app to smart TV home screens.
  • Granular attribution: Leverage Tremor Video’s advanced digital measurement capabilities to identify and optimize campaigns to achieve better outcomes – either as a stand-alone CTV campaign or in conjunction with linear TV and digital efforts.

Read “Tremor Video’s Guide to the Evolving Living Roomto learn more about the latest innovations and challenges in the modern living room and see how ad-supported content offers powerful new opportunities to engage, convert and measure.

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