CTV’s under-tapped opportunities for marketers

By Janina Abou Al Ward
Senior Product Marketing Manager
April 6, 2022

From audience size to time spent to advertising spend, connected television (CTV) currently tops nearly every industry list of advertising growth trends for 2022. And no doubt, from an advertiser’s perspective, CTV is an opportunity that brands large and small can no longer ignore if they want to stay relevant in today’s evolving media landscape. However, as with all marketing channels, not every CTV advertising opportunity is created equal.

By all measures, CTV usage has increased considerably over the past year. As noted in Verve Group’s 2022 media strategy guide, which details the audience and media buying trends seen over the past year, our own CTV exchange saw a tremendous surge in average impressions by device, indicating that CTV usership has increased significantly throughout the year. In fact, as of November 2021, average CTV impressions were up 440 percent year over year on our exchange, even though device counts remained stable. 

For advertisers these days, the question is no longer whether to advertise on CTV. It’s how to advertise on CTV. While CTV is no longer considered to be an emerging channel, specific content categories are still under-leveraged. For the right brands with the right approach, the ROI opportunity is tremendous. Let’s take a look at some of the category insights that advertisers can put to work in their CTV media plans immediately. 

Understanding CTV Advertising Dynamics by Category

When it comes to assessing CTV advertising opportunities, the dynamics vary greatly depending on the category. In this regard, there are two core factors to consider for a given category: the average CPM on inventory in a category and the aggregate amount of ad spend going into that category. Where a given category sits on those two axes says a lot about the corresponding opportunity for advertisers.

CTV content categories

Highly competitive categories with premium household audiences: CTV content categories that offer high-value inventory with high CPMs are in great demand. On the Smaato (a Verve Group company) CTV exchange, these highly competitive categories with premium household audiences include the news category as well as food and drink. Increased prices and aggressive competition aren’t reasons to avoid given advertising categories, of course. The reason these categories are in demand is because the value of their audiences has been demonstrated time and again. The high CPMs and spend are also reflective of the fact that these verticals have a high frequency of consumption from high-quality audiences.

Categories with a clear opportunity for marketers to bid and win: On the flip side, when a category attracts strong ad spend while maintaining low CPMs, advertisers have a clear opportunity to bid and win in these categories. At present, we see these interesting dynamics at play in the technology category. The value of these audiences tends to be high, and so does the availability of inventory—a win-win for the right advertisers. 

Categories with an opportunity to experiment with low budgets: CTV categories that don’t attract a high volume of aggregate spend and maintain low CPMs offer advertisers an opportunity to experiment with small budgets, which can open CTV advertising to brands that might not otherwise consider it. Categories like health and fitness, movies and even weather offer this easy entry point for brands. For the right brands with the right messages, the chance to achieve an outsized impact through these CTV categories can be a gamechanger that enables the brands to deepen their activities in the channel over time. 

Categories that leave room to compete for premium inventory: And finally, there are a handful of CTV inventory categories that, despite low aggregate spend, maintain relatively high CPMs. We see this dynamic at play in categories like auto, music and sports, all of which currently leave room for advertisers looking to compete for premium inventory. 

Depending on a brand’s target audience, the above dynamics can lend themselves to tremendous opportunities for advertisers looking to get in on the growing CTV opportunity. The key is to understand the implications of the forces at play for any given category and ensure they align with a brand’s specific audiences, budgets and objectives. And above all, as advertisers wade into CTV, they need to ensure they have plans in place for measurement and attribution so that their buys within these categories can be optimized on an ongoing basis. 

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