78% of marketers plan investments in connected TV ads, study finds

Dive Brief:

Seventy-eight percent of marketers plan to buy connected TV ads over the next 12 months, according to results of a survey commissioned by SteelHouse and conducted by Advertiser Perceptions that were provided to Marketing Dive.
When it comes to marketers' use of video ads, 49% use video frequently, 38% occasionally and 11% use them in all campaigns. Marketers are allocating about 30% of their total advertising budgets to digital video across channels, with 28% directed to social platforms, 26% to in-stream, 20% to traditional local or national TV and 13% to in-unit ads. Connected TV, also referred to as over-the-top (OTT), is capturing 12% of planned spend.
The top KPIs for measuring video inventory were completion rates (49%), impressions and reach (46%) and quality scores, including viewability and fraud (44%). However, marketers and agencies differed on which metrics were most important to them. For marketers, 48% valued impressions and reach, 47% said the same for completion and 44% cited click-throughs. Agencies valued completion at 53%, quality scores at 45% and in-target delivery and GRPs, like comScore and Nielsen, at 45%. Sales attribution was at the top for 28% of both groups.

Dive Insight:

As marketers continue to beef up their investments in digital video, the SteelHouse survey shows how many are seeing connected TVs as the solution for reaching consumers whose viewing habits are shifting from linear to digital platforms. The number of cord-cutters was expected to reach 22.2 million in 2017, a 33.2% increase from 2016, according to eMarketer forecasts.

Connected TV is commanding 58% of marketers' investments in advanced TV channels, according to Advertiser Perceptions' 2018 Video Advertising Convergence Report released this month. Programmatic linear TV, addressable TV, data-enabled linear TV and set-top box VOD are other advanced TV formats that marketers are eyeing. Audience targeting, cross-screen planning and buying and addressability are driving those investments.

Ads running on connected TV can achieve higher than average completion rates, sometimes up to 90%, according to some analysts. While the SteelHouse research shows that completion rates, impressions, reach and quality scores were the top metrics, marketers and agencies aren't always in agreement about which provide the biggest benefit. Better measurement capabilities will likely lead to wider adoption of connected TV.