Connected TV and streaming services have been on the public’s radar for quite some time. However, it wasn’t until 2020 that this trend exploded. Many Americans canceled their cable subscription services, most saying they won’t go back. In response to the recent pandemic, data shows that OTT video streaming increased by 400% — and average revenue per subscriber is still growing.
Favoring connected TV and streaming services, this movement has led to significant business opportunities, especially in terms of marketing and customer acquisition. Research shows that 59% of ad buyers planned to increase spending on connected TV and OTT in the second half of 2020. Brands planned to increase CTV/OTT budgets by 32%, and agencies were looking to increase spending by 46%. This means that if you’re not considering the power of CTV/OTT ads this year, you risk being left behind.
There are many reasons to take the leap, including greater customer acquisition.
If your goal is to get more customers this year, here’s what you need to know.
Research Supporting the Benefits of Connected TV for Advertising Is Overwhelming
Since 2020, research shows that the “streaming generation” has shifted toward a connected TV culture. COVID compressed years of marketing innovation and disruption into a few short months, and things are unlikely to go back to the way they once were.
Here are some findings from the white paper, The Future of TV Report: The CTV Tipping Point:
- 15% of consumers canceled their cable subscription during the pandemic. However, advertisers could reach over 84 million households via connected TV and streaming services.
- 79% of people who stopped paying for cable said that they are unlikely to subscribe again.
- Ad revenues dropped 14% year-over-year across all types of media, yet ad revenue from CTV/OTT saw an increase of 17%.
- 89% of marketers reported connected TV is more effective, or is equally effective, as tools offered through linear TV.
- CTV is leading to ad creativity, with 59% of TV media buyers making shorter ads a priority.
- 37% of ad buyers plan to hire new talent fluent in CTV, and 55% said they plan to take steps to ensure that their team can navigate both channels (linear and CTV).
- 95% of marketers said that CTV achieved desired key performance indicators.
This has created opportunities for business owners and marketers based on the benefits of CTV advertising. This report found that:
- Advertising may be a different experience on CTV platforms compared to traditional TV. Approximately 57% of viewers say that they would be “open” to lowering their subscription cost on paid platforms if they were to see ads every other episode while watching a show.
- Another 40% said they would prefer ads that were tailored to their interests.
- Only 14% said they would pay a premium for an ad-free experience, while 71% preferred a free or lower-cost ad-supported model.
The Benefits of Connected TV Advertising
A report by Emerging Alliances found that direct-to-consumer shoppers spend the majority of their weekly TV time watching streaming services — equating to 13 hours. This is 20% higher than cable and 70% higher than social. Incredibly, 82% of these shoppers take action after they see a CTV/OTT ad, showcasing the effectiveness of this strategy.
Although you may have largely relied on marketing through social media platforms until this point, CTV/OTT is now offering the perfect blend of digital marketing capabilities with the viewing experience of television. If your goal is to make your connected TV audience into new customers, it’s important to understand the value of targeted advertising.
The key here is to embrace data-driven advertising. Unlike traditional TV advertising, connected TV and OTT allow you to target an audience with much greater certainty. This audience-first strategy offers the benefit of more precise and measurable outcomes.
With CTV, you know exactly who is viewing your ads. This helps you stay on-trend with consumer behavior.
Other benefits include:
- Budget-friendly — Thanks to precise targeting, connected CTV advertising is cost-effective! Since you can reach your target demographic, this will allow you to stretch your budget.
- Improved viewability — Not only are CTV viewers often more engaged because of the on-demand experience, but this approach allows you to track how many target users actually saw your ad. This will allow you to optimize, focusing on brand awareness and customer acquisition.
- Ad format experimentation — Want to see what call-to-actions work best for your current goals? Split test with CTV advertising.
- Data-driven targeting — Use first- and third-party data to reach your most valuable audience in terms of conversion rates.
How to Make Connected TV and OTT Generate New Customers for Your Brand
When creating your CTV campaign, the planning process will be like any other advertising strategy.
You need to set marketing objectives and define your goals. In this case, your core goal will be to generate new customers. Based on that goal, you need to create an action plan, which includes the following steps.
Step one: Define your target audience
When planning your CTV ads, you need to know who your target audience is. When identifying who your audience is, consider the following categories.
- Demographics, including age, income, and location.
- Interests, including their personal goals, family life, and recreational activities.
- Purchasing behavior, focusing on the information your audience likes to have before they make a purchase. This will help you improve your message when aiming to generate new customers.
Step two: Decide where you want to display your ads
You want to go where your audience is. Consumers seek brands they’re familiar with when it comes time to buy, which is why you want to advertise where prospective customers will find you. Based on your target audience, would you benefit from advertising on CNN or Discovery+? What about Apple TV or Roku?
Baskin Robbins is an example of when traditional TV ads and CTV ads complement one another. This beloved company displayed an ad on linear TV and Roku (CTV). Data shows that 86% of the viewers on Roku who saw the ad did not see it on linear TV, leading to a 10.6% incremental reach.
Step three: Stay mindful of key metrics
As you record and analyze your data, continue to optimize your approach. Depending on your ongoing goals, launch multiple campaigns, targeting different types of consumers. Set performance benchmarks and then split test your top two creatives.
Adjust and tweak your campaigns according to the data you collect.
Recommended reading: How to Develop Creative Advertising That Motivates Customers to Try and Buy
Step four: Work with an advertising agency that will ensure the greatest ROI
Partnering with a credible advertising agency can help you save money by maximizing the value of your advertising budget. This step is especially important if you have no experience in CTV advertising. Now is the time to take advantage of this opportunity, so work with a team that will help you get the most out of your advertising campaigns.
DX Media Direct Can Help You Achieve Your Goals
If you’re new to CTV advertising or simply require expert support, DX Media has over 25 years of experience helping brands achieve growth.
We specialize in the four key components of any successful CTV campaign, including:
- Data science
- An experienced CTV/OTT media buying team
- Volume discounts
Ready to take your upcoming CTV campaign to the next level? We can help you develop a winning strategy to generate more customers!
We offer a free, no-obligation consultation, so contact us today!
You Can. Here’s How:
Once again, Google is throwing a curveball to the ad/MarTech world. If the ever-changing search algorithms weren’t difficult enough to deal with, businesses and marketers now face life without cookies. The search engine giant announced earlier this year that beginning in May 2021, the use of third-party cookies on websites will no longer be allowed. What does this mean for businesses?
Official Release: Death of Third-Party Cookies Coming Soon
Google’s plan to gradually eliminate the use of third-party cookies and reduce the possibilities of primary cookies has earned the nickname “Cookie Apocalypse.”
The announcement that Chrome browsers will render all third-party cookies obsolete by 2022 has shaken the marketing world. Digital marketers saw it coming but hoped it wouldn’t become a reality for at least another five years. Much to their dismay, the countdown to the Cookie Apocalypse has begun, leaving them less than a year to adapt and rethink marketing strategies or risk vanishing into oblivion.
Safari and Firefox have already effectively done away with cookies, and for marketers and data analysts, this means over one-third of that data has already disappeared. This has made it more challenging to run ad campaigns and measure their effectiveness.
An apocalypse might sound melodramatic as a name for this event, but we’re talking about more than the “look-outside-and-see-an-orange-sky” type. Apocalypse comes from the Greek words apo (un-) and kaluptien (to cover). To put this into context: the loss of third-party cookies is a form of revelation. In this new era, we’ll “uncover” or find out what was wrong with marketing and see who will come out on top.
What We’ve Learned So Far
The evolution of online advertising in the mid-1990s and early 2000s was like the wild west days of marketing. The internet was vast and mostly untamed. For publishers and advertisers to get the right ads in front of the right people and in the right context, they needed more and more data. This need became increasingly overwhelming for advertisers and consumers alike as the right to privacy became muddled.
To overcome this problem, governing bodies enacted stricter privacy regulations to protect consumers. The two most notable examples are the EU General Data Protection Regulation and the California Consumer Privacy Act.
At their end, browsers like Chrome and Firefox and operating system producers like Apple’s iOS have used privacy policies to attract consumers fed up with the way their data was appropriated without their consent.
Tighter privacy laws combined with consumer preferences took us to the point where browsers started limiting advertisers’ access to third-party cookies. Mozilla Firefox and Apple Safari started the move, and Google Chrome is now set to join them. For those in the advertising and ad tech business, this change threatens their very livelihood. But problems were already brewing.
The number of data points and sources grew exponentially over the years. This growth has made marketing more and more complex and has created many problems for marketers. Not only is it overwhelming to process that amount of data, but it is also an expensive strain on resources. The inability to properly manage all this information led to privacy issues. It even resulted in fines for some offenders.
Big data and the introduction of machine learning are a tremendous help to marketers, but the impending loss of third-party cookies reveals one major flaw in the recipe. The heavy reliance on third-party marketing strategies over the past few decades has resulted in companies losing touch with their customers and losing control over customer data.
Once Chrome puts an end to third-party cookies, online advertising will more resemble a blunt instrument than the finely honed scalpel it is now because companies won’t own the data. Yes, new third-party cookie alternatives will fill the gap as time goes on. However, marketers will need to try harder and work smarter to find target customers.
The ride will be challenging for a while. Still, the death of cookies allows marketing organizations to re-establish relationships with customers and create new strategies for handling consumer data.
Surviving the Cookie Apocalypse
Three entities emerge as the big winners after the crush of third-party cookies: large first-party data environments, the public, and companies with first-party data collection strategies.
1. Large First-Party Data Environments
The third-party cookie apocalypse puts those companies with the most first-party data in an enviable position. The largest environments—such as Apple, Google, and Facebook—already have so much information on their customers and consumers that they don’t need to rely on third-party data. People come to them.
Undoubtedly, these companies struggle continually to gain and keep consumers’ trust, but that doesn’t stop millions and millions of users from flocking to these products and services. Consumers have come to depend so heavily on these establishments that they consider the companies indispensable to their daily lives.
Without third-party cookies, the privileged position of these companies is even more valuable than before. Now is the time for smaller players to dig in their heels, maybe join forces and devise a more viable, sustainable future for themselves and their businesses.
In the meantime, advertisers will likely have to work closely with these Big Boys.
2. The Public
This one may be considered a double-edged sword. On the one hand, many consumers will like the idea of not being tracked anonymously across the internet—not having their browsing habits followed and stored in a database somewhere. On the other hand, disallowing cookies does not mean the end of data collection. Some form of tracking will happen, probably with consent.
And in the immediate aftermath of third-party cookie loss, online ads may be laughably inappropriate instead of uncannily specific, like they are now.
It will take a while to see how privacy issues shake out, especially considering the effects of stringent privacy regulations. Privacy is an area where consumers most certainly come out on top regarding their relationships with brands. The more companies struggle to gain control over their data, the more they will need to entice consumers to voluntarily provide the sensitive information brands desperately need to understand consumer buying trends.
Enticements could range from sign-up and sign-in (identifiers and authentications giving permissions) to incentives to opt-in to different forms of data sharing. No matter what method they choose, companies will need to try harder to get close to consumers.
3. Companies with First-Party Data Collection Strategies
The third winner in this new post-cookie world will be the companies that have invested in first-party data collection and activation. Too many companies have relied solely on third-party data collection to gain new customers. This strategy has put them right on the chopping block now that they have to pivot their advertising campaigns toward first-party data collection methods when hoping to create mirror audiences.
Time is running out, and 2022 is just months away. That doesn’t leave much wiggle room for creating an entirely new data infrastructure. Marketers with well-managed first-party data collection and activation strategies will have an immense advantage over others for adapting to a third-party cookie-free world. They will be in the perfect position to respond quickly to ever-changing privacy regulations and learning the secrets to making Google work.
The companies that aren’t there yet better get a move on or face the consequences of entering the new era unprepared.
What can you do now to prepare for the loss of Third Party Cookies?
One excellent strategy is to begin collecting first-party data through your advertising campaigns on Google, Facebook, and Connected TV. The more data you are able to collect on who responds and buys your product or service the better. Don’t focus on just one advertising type or outlet. Each one has its strengths and weakness. Use an experienced advertising agency or media buyer to help you navigate each outlet and put strategies in place to make sure you are getting a good return on your investment while you are collecting first-party data.
Why is first-party data so important for your future advertising campaigns?
When you collect First-party data you then have the power to build a look-alike audience. So that data helps you market exponentially to customers who have the same wants, needs, buying habits, and media habits. Your first-party data becomes a secret weapon for reaching people just like your current customers. You don’t have to waste dollars and time hoping your advertising is hitting your target market. The data does that for you.
The death of cookies allows marketing organizations to re-establish relationships with customers and create new strategies for handling consumer data.
Now is the time to act for the future of your business
Surviving the cookie apocalypse means learning the secrets to making Google work for you, not against you. With the pandemic dominating the way people work, think and act, it’s understandable that advertisers haven’t given the demise of the cookie their full attention. However, more activities are happening online than ever before. It gives advertisers access to more people, but when the cookie crumbles, this extra internet activity won’t help.
With the shutdown of third-party cookies by the start of 2022, advertisers need to take action now. They need to take a proactive role in considering alternatives and deciding how to move forward. They need a solid plan on how to fill the massive gap that the death of the cookie will leave.
By collaborating with analytics, agencies, and ad tech providers, companies have the unique opportunity to control the planning and operating of digital advertising. They must take over the investment and measurement end of the business once and for all. In the end, this means better performance metrics, more transparency, and enhanced customer experience. It is a true win for all concerned.
Next year may mark the end of an era, but it’s the beginning of an even better way to market to consumers.
Three Steps to Measuring, Managing and Maximizing Your Advertising Performance
There is a saying in advertising that “You cannot manage what you cannot measure.”
Which is absolutely true. The power of refining your advertising campaign’s performance relies on your ability to find underperforming media outlets and renegotiate, refine or remove them. They key is making sure that you are measuring what matters, managing what you can change and maximizing the performance of each campaign, so you can fix broken elements sooner than later.
Step 1: Measure What’s Important to Your Sales Cycle
The first step to maximizing campaign performance is to decide what you will be measuring, how you will measure it and what data you need to make change. There are several key items to consider. If you start with what you know then you can build a baseline for a solid measurement strategy.
“Where do I start?” In today’s digital world it’s easy to get so granular in your data that you end up being impressed with the wrong data or giving parts of your information more weight than you should. So, start with the end in mind. Start with what makes the cash register ring.
It’s also known as your conversion ratio. Begin by answering these key questions:
- How many opportunities do you need to create a sale? This can look different depending on how your business operates.
- If you sell your products or service online, then install Google Analytics and look at how many unique visitors per day, week or month it takes to generate a sale.
- If you are in retail, how many customers must visit your location for you to create a sale?
- If you sell direct, then how many prospects must you talk to on average to create a sale?
This number is your current conversion ratio. Finding your conversion ratio is the first building block to understanding what it takes for your campaign to be successful. Once you have your conversion ratio, then you can place benchmarks on the cost or investment you can afford to make in your marketing to create opportunities.
Now that you have your conversion ratio in place, ask yourself this question: “Is there any way to improve conversions or conversion ratio before I invest more money in advertising or marketing?”
If you need some resources to look at industry standards or competitor information, you can easily find benchmark information online. For Facebook statistics, for example, check out these benchmarks. Online advertising pro Larry Kim wrote in his eye-opening article “Everything You Know About Conversion Rate Optimization is Wrong” that you may be surprised at how low your conversion ratio is compared to the top performers in your industry.
Larry Kim writes:
“If you’re already achieving 3%, 5% or even 10% conversion rates, is that as high as you’re going to go? But what is a good conversion rate? Across industries, the average landing page conversion rate was 2.35%, yet the top 25% are converting at 5.31% or higher. Ideally, you want to break into the top 10% — these are the landing pages with conversion rates of 11.45% or higher.
We recently analyzed thousands of AdWords accounts with a combined $3 billion in annual spend and discovered that some advertisers are converting at rates two or three times the average. Do you want to be average, or do you want your account to perform exponentially better than others in your industry? So what is a good conversion rate? About 1/4 of all accounts have less than 1% conversion rates. The median was 2.35%, but the top 25% of accounts have twice that – 5.31% – or greater. Remember, this isn’t for individual landing pages – these advertisers are accomplishing 11.45% conversion and higher across their entire account.
Clearly, this isn’t some anomaly; this is perfectly attainable. If you’re currently getting 5% conversion rates, you’re outperforming 75% of advertisers … but you still have a ton of room to grow!”
This gives you some insight into online conversion ratios.
What about offline? If you have a retail location, keep track of weekday foot traffic and weekend foot traffic. Measure the number of sales by location by day, accounting for seasonality, bad weather days or any redirection of traffic. For direct sales or if you have an in-house sales team, you can track the number of inquiries each salesperson receives and how many they convert on average into a sale.
Campaigns that we have seen achieve the most success over the years have maintained anywhere between a 6% and 16% conversion ratio. It is rare for an offline campaign to succeed long term if you are able to speak to prospective customers (either face to face or by phone) but experience a 3% or less conversion ratio. The cost per response is simply too high. If your current team can convert at 6% to 20% you have a solid foundation for moving forward with your campaign.
Ok. You’ve established your conversion ratio. You have measurement in place to know daily or weekly how many responses or opportunities it takes to create a sale. You feel good about where you are in your current sale system to maximize every opportunity.
Step 2: Refine What You Can Control
Your second step is to refine the elements of your campaign that you can control. Here is what you can control in your campaign:
- The media mix
- The creative
- The frequency
- The audience you need to reach
- The rate you pay to reach that audience
In regard to the media mix, determine whether the media mix you are using fits the way your company sells. Your company is unique. You have a culture, a system and process for how you sell best. You want to make sure the media you use plays to these strengths. For example:
- If you have a great system for selling online, following your customer from interest to search to checkout but don’t do a great job with inbound calls, then make sure your media mix directs your customers to your online experience. (It’s been said “People want to buy–they just don’t want to be sold.”) If you are strong online, then make sure your site is fast, easy to use, mobile friendly and your advertising cost effectively drives them to that online experience. Your media mix can support your ability to sell and improve your cost per sale. Look at the time of day and days of week you generate the most sales. Advertise then. If you are a digital powerhouse, then of course digital is going to be a great vehicle. However, you may also find that offline media like radio, TV, or outdoor also does a good job for creating that interest to interact with you online.
- Traditional sales processes: Drive interested prospects to your best sales people. Use the power of the media to create inbound leads so your seasoned professionals can spend time doing what they do best. Are you open Monday through Friday 9am to 5pm? Then consider radio as an option if your product or service does not require a visual demonstration. Radio is effective for reaching prospects close to the time of purchase. If your product is visual, then use video or television to show how effective it is.
- Creating quality creative: In regard to your creative, make sure you are visually and audibly speaking in terms your customer understands and in simple ways the customer can easily see what’s in it for them. Have you ever watched a television spot and asked yourself “what that was about?” or seen the ad and questioned “who is this for?” Or worse, have you ever just tuned it out, clicked away or turned it off because you were immediately NOT INTERESTED. These are all signs of bad creative. Don’t fall prey to lazy writing, poor design and feature-focused ads. If you want to see how other companies execute creative, go to www.moat.com for web advertising ideas or www.ispot.tv Make note of ads that motivate you, interest you or capture your attention. Ask yourself why. What about this ad made you want to act or do what the ad was instructing you? What enticed you?
Step 3: Maximizing Campaign Performance
The third step is to make sure you are getting a good value for your advertising. This relates to how much you are paying to reach your target audience with enough frequency to take your prospect from interest to awareness to action. If the advertising campaign you are running is not producing a measurable ROI, then look hard at letting a professional media buyer help you navigate the options you have to make it more effective. There may be several other media options you have simply not discovered yet that could take a losing campaign and turn it into a winner.
Reach out to DX Media Direct if you’d like to learn more about creating more effective advertising campaigns.
The heat is on. As summer rears its head with scorching temperatures across the U.S., a few interesting trends are developing.
According to Business Insider, metropolitan cities in the south as well as the Pacific Coast are seeing population influxes despite the less-than-friendly temperature spikes in these areas during the summer months. Keep these geographical trends in mind when booking, buying and selling media through the third and fourth quarters of sales this year.
Perhaps the hot weather is not as much of a factor when many Americans are inside enjoying central air-conditioning and their favorite shows on television. But advertisers beware: a recent report shows that despite the variety of television stations and shows people watch on a daily basis, when it comes to commercial breaks, viewers check-out of the advertisements and check-in to social media platforms.
To capitalize on viewership during commercial breaks, advertisers are tapping into social media platforms to ensure reaching the maximum amount of viewers. Using social media for advertising purposes has the potential of reaching a more diverse audience as well as allowing for a more interactive experience between brands and consumers.
DX Media Direct
In a recent interview with Buzzfeed’s Chief Revenue Officer, Lee Brown AdWeek asked “What types of videos work best for branded content?” His answers are both insightful and actionable. Why should we listen to Buzzfeed? Because they generated over $100 million dollars last year in revenue. So here goes. Here is what he says works.
1.) Identity. The video connects with the viewer and says “This is so me.” Have you ever seen a post that you identified with? Then that’s a video built to connect with you because it makes you feel like someone understands.
2.) The Emotional Gift. This is a video Lee Brown says makes you laugh out loud and want to share with your friends and family.
3.) Informational. These are research-driven or how-to videos that give the user information they can use. These videos get attention. They can also help you build your brand by helping your target customers learn something that makes their life better.
There you have it. Thinking about producing a video for online attention? Craft it to meet one of these categories and it should deliver.