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Fact or Fiction: Busting Five Myths of CTV Advertising

Over 48 million homes will shift from linear TV to only connected TV (CTV) by 2021, according to eMarketer. As CTV has gained momentum with consumers, advertisers have invested accordingly. CTV ad spend in the US will reach $20.1 billion in 2020, according to Tru Optik — a growth rate of over 50% year-on-year. 

Matt McLaughlin, COO, DoubleVerify

Matt McLaughlin, COO, DoubleVerify (Image credit: DoubleVerify)

As a result, measuring the quality and performance of CTV buys is increasingly critical. To do that effectively, however, it is important to understand and debunk the most common CTV ad myths among buyers. 

Myth 1: CTV and OTT are the Same Thing

First, CTV and over-the-top (OTT) are not the same thing, though they are often referred to as synonymous. CTV is a television or internet-connected device that enables viewers to access content through applications, some of which may come preinstalled on a TV. Unlike linear TV, CTV includes smart TVs, streaming devices like Roku, TiVo, and Apple TV, as well as gaming consoles like PlayStation and Xbox. One of the reasons CTV is so appealing to advertisers is that it already has an incredible audience reach. 

Nick Frizzell, VP of Operations, Inventory Quality, SpotX

Nick Frizzell, VP of Operations, Inventory Quality, SpotX (Image credit: SpotX)

OTT, on the other hand, is video content delivered via the internet rather than through cable or satellite, regardless of the device used. Crackle Plus, Pluto TV, and Sling TV are examples of OTT services. They are apps or websites that provide streaming video content while bypassing linear distribution. OTT delivered through CTV is often full screen, immersive, unskippable, broadcast quality, and available to stream on other devices such as smartphones. A recent IAB study found that 76% of OTT streamers watch ad-supported OTT content and 62% of viewers don't mind seeing ads if they aren't paying anything for the content. This signifies that viewers are leaning into advertising on OTT and absorbing content at high rates, which is attractive to advertisers trying to reach highly-engaged audiences. 

Myth 2: CTV Inventory is Scarce, Especially in Programmatic

Many advertisers believe that programmatic CTV inventory is scarce. However, in actuality, CTV inventory boasts substantial scale. Relying on linear TV alone is a missed opportunity for marketers trying to effectively reach audiences at scale. Comscore finds that 80.5 million watch pay TV, 70 million watch CTV and 21 million watch both. Meanwhile, 48.9 million do not subscribe to linear TV at all -- and that number is only growing. In other words, by incorporating a CTV strategy into their media mix, advertisers can reach the “unreachables.” 

In addition, CTV inventory is diverse and growing. Almost all the premium network broadcasts are available programmatically if they are ad-supported, and premium network inventory is becoming increasingly available in an automated way as we see legacy providers launch their own CTV advertising-based video on demand (AVOD) services. Because this inventory can be transacted programmatically, CTV also delivers the targeting benefits of digital, allowing advertisers to cherry pick their most relevant audiences, rather than buying all households as they would on linear TV.

Myth 3: CTV is Not Measurable

Because CTV is a relatively new platform, many advertisers believe that it isn’t measurable. This common misconception may stem from the fact that different technologies are required for CTV measurement than those used for mobile and desktop. In mobile and desktop environments, there is widespread adoption of ads.txt which is an IAB-approved text file that publishers can use to publicly list the companies they authorize to sell their digital inventory. In contrast, there is a limited but growing adoption of apps-ads.txt (a similar file that designates authorized mobile app inventory sellers) within the CTV landscape. As the mobile and desktop landscape has matured, measurement technology for those devices is now well developed and adopted widely. CTV measurement technology, on the other hand, is nascent and adoption of standardized measurement tools and naming conventions is currently inconsistent. 

Quality measurement is definitely possible on CTV and starts with transparency. Advertisers should demand that programmatic  partners be certified for fraud protection on CTV. They should also partner with third-party verification providers who are able to scale across and independently evaluate this emerging medium.

Myth 4: Fraud Doesn’t Exist Across CTV 

Since CTV is a fairly new but evolving platform for advertisers to reach audiences, many believe that it is free of fraud. Unfortunately, however, that is not the case and in fact, CTV is a target for fraud. It is particularly attractive to fraudsters as a result of high CPMs (cost per thousand impressions or ‘mile’). In addition, CTV demand outstrips supply and advertisers are flocking to buy programmatically, which introduces new risks not present in direct buys. In short, bad actors are following the money.

Within the last 12 months, DoubleVerify has detected more than a thousand fraudulent CTV apps and more than 500,000 fraudulent devices are detected each day. CTV fraud can take many forms. Fraudsters can easily create their own CTV apps and release them to open and closed app stores. Today, hundreds of apps exist with few downloads, but millions of impressions. In other cases, bad actors create a layer of ad tech that app creators unknowingly rely on, leading to fraudulent app traffic. Server-side ad insertion (SSAI) is another example. SSAI technology has some amazing benefits, but the same technology can be used to easily generate fraud at scale. Fraudsters can either create their own SSAI servers or route / license these services to garner ad revenue from fake traffic, making it look legitimate. Having direct relationships between buyers and sellers can drastically reduce fraud in these environments. 

Myth 5: All CTV Inventory is Premium and Created Equal

CTV inventory has become synonymous with premium inventory; however, that is not always the case. This is, in part, because app stores have different regulations. 

While some app stores have closed environments and vigorous processes in place to ensure quality, others have an open infrastructure that enables ‘turnkey’ solutions, allowing anyone to make apps available. Because of varying standards across different app stores, apps that have non-brand safe content can be created and are ripe for ad fraud. Programmatic platforms are combating this by integrating CTV certification programs that force users to demonstrate their ability to prevent fraud. 

It's evident that CTV advertising is a highly effective way to reach audiences at scale with personalized messaging across multiple platforms. But to ensure that CTV campaigns are effective, media buyers need to be equipped with the right information so they can optimize their strategies accordingly and avoid fraud. To get the highest return on investment from CTV, media buyers should be sure to work only with trusted partners that can advise which inventory is authorized and have humans to manually check inventory quality. 

SpotX is the leading video advertising platform shaping digital video and the future of TV globally. The company’s solutions enable media owners to monetize content across all screens and streams while providing advertisers with direct access to brand-safe, premium inventory. 

DoubleVerify is a leading software platform for digital media measurement, data and analytics. DV’s mission is to be the definitive source of transparency and data-driven insights into the quality and effectiveness of digital advertising for the world's largest brands, publishers and digital ad platforms.