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The Inevitable Future — All TV Will Be CTV

A man using his phone while watching TV
(Image credit: Maskot via Getty Images)

Years ago, Reed Hastings predicted that the migration from traditional broadcast to streaming would happen at an annual rate of six percent. 

This was at odds with both supporters and proponents of streaming formats. Streaming bulls adhered to the Silicon Valley myth that TV was already falling apart due to a “massive wave of cord cutting.” 

Yet most brands continued to pour money into traditional linear as it was still the only way for them to reach and create emotional connections with tens of millions of consumers at once.

TV Goes Digital

Turns out Hastings' prediction was pretty accurate. As more viewers turn to streaming or “connected TV" (CTV for short) they are finding a much broader array of options, from subscription apps to free ad-supported streaming TV (FAST) apps. 

This presents a tricky situation for marketers who have difficulty straddling both CTV and linear TV. While both formats are valuable, particularly when used in tandem, the pathways to buy, plan, and measure across both platforms can be hard to navigate. 

Part of the problem is the question of responsibility. The structural systems set up even three years ago on the buy and sell side include digital teams, TV teams and offshoots like advanced TV. Now, this bifurcation has resulted in imaginary fences and organizational obstacles to work through. 

We hear it from brands all the time — they just want a cohesive, holistic TV investment strategy. Not a complicated terrain that pigeon holes them, or excuses why they can’t have the widest reach AND the smartest audience buying strategy. 

Fortunately, there’s a solution on the horizon that will allow advertisers to take advantage of both streaming and linear TV without fragmentation — the smart TV.

The Smart TV Revolution

Travis Hockersmith

Guest blog author Travis Hockersmith is VP Platform+ at Vizio. (Image credit: Vizio)

Smart TV penetration is expected to reach 70% of TV households by the end of 2021

And this rapid adoption of smart TVs presents a huge opportunity to unify the entire landscape to one where all TV will be connected. At its core, this means every ad will be a CTV ad — with all the targeting, tracking, and optimizing promises across linear, broadcast, apps, AVOD services, you name it.

That’s right, every ad that hits the glass of a connected TV can and will be addressable.

This will be a win-win-win for everyone. Consumers will get a more customized experience. Advertisers will see better performance on their campaigns. Programmers will be able to deliver a more personalized approach to consumers that generates more engagement.

What’s It Going to Take?

Nearly everyone in the ad industry is bullish on a future where TV advertising is this dynamic, where software makes selling more efficient, and where algorithms deliver ads with the same kind of precision we enjoy on Instagram.

But there’s a reason addressable TV has never gotten much past a $3 billion category, despite the promise. It’s clunky, opaque, and designed only for experts. 

Advertisers like simple, fluid, and liquid markets. After all, anybody can buy ads on Facebook or Google, which is a big reason why anybody and everybody does.

But the technology to solve this is already here. We really can't use the "clunky" excuse anymore. With the rise of smart TVs, pretty much every form of television viewing is now connected to the internet, whether a person is "streaming" or not. And with ACR technology, companies can actually "see" when ad breaks are coming and swap out ads with something more targeted. 

Yet media owners remain at best cautious, and at worst reluctant, to commit fully to the format. This is somewhat understandable, for two reasons. First, many are still stinging from the commoditization of their inventory shortly after they first leaned into automation for the programmatic display market. Now we’re talking about higher CPMs for the most impactful advertising medium there is, where they already have infrastructure built and content deployed. 

Second, and perhaps more impactful, is that no common currency for measuring effectiveness of advertising across screens and platforms. Sure, it’s all measurable. But cross-platform benchmarks and standards are needed to provide the proper context.

But the CTV infrastructure is already maturing rapidly, with solutions for things like creative versioning and deduplication already in place. Media owners have also seen what a data driven approach does for consumers who get more value from data driven platforms — Netflix, Facebook, Spotify, Amazon all have data driven backbones.

Of course, nothing lights a fire like brands demanding change. I’m confident that as big marketers get a taste of what CTV can really offer, and how it will improve their business, they’ll keep pushing for more. 

And all TV will just become CTV. ■

Travis Hockersmith

Travis Hockersmith is VP of Platform+ at Vizio.  As VP of Platform+, he currently leads operations for Vizio's rapidly growing platform business which includes Vizio Ads and Inscape.