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BizReport : Advertising : July 05, 2017

Expert: Connected TV trends to watch

It is important to know that OTT includes TV content streamed to any screen including TV's, PC's and mobile devices, and that Connected TV refers to OTT watched on at-home TV's, which accounts for 70%+ of OTT view time.

by Kristina Knight

Kristina: You say connected TV will save television - why?

Andre Swanston, CEO, Tru Optik: Digital surpassed TV in ad spending in the US last year for 2 main reasons: better targeting and better measurement. OTT and CTV moves TV advertising beyond demographics, allowing advertisers to target audiences on things like purchase behavior, media consumption habits, and lifestyle. And they can do this with the same precision, scale, and flexibility they have become accustomed to in digital. CTV combines the high-engagement premium content of TV with the advanced targeting, messaging, and measurement capabilities of digital to provide a 'best of both worlds' medium for advertisers. That will not just save TV, it will take it to a new level.

Kristina: What impact are connected TVs having now?

Andre: The strategic impact is enormous. Every ad agency, TV network, and brand advertiser knows the future of television is OTT. So you see dramatic change across the entire spectrum of TV, starting with how consumers watch TV -- 75% of US homes now watch connected TV at least some of the time, a 3X increase in less than 5 years. Broadcast and cable networks are aggressively launching digital channels to establish an OTT presence, even if it speeds up the erosion of linear TV audiences. All of this is creating a sort of linear TV economic bubble. Linear TV is still in demand among advertisers as a reach vehicle, but with declining audiences and increasing CPM's, the value equation soon won't add up.

Kristina: How do you expect this to change over the next 3-5 years?

Andre: Right now there are several of types of "advanced TV' available to advertisers. Some established TV networks are allowing advertisers to define targets using data other than demographics. That's an improvement, but they're still selling shows, not audiences. So if you're a car brand, now you can buy commercial time on a show that is 5X more likely to be watched by people in the market for a luxury car. But if only 2% of consumers are in the market for a luxury car, 90% of your dollars are still wasted.

Tags: advertising, connected TV trends, ecommerce, OTT trends, TruOptik

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