Connected TV ad requests jump 1,640% in 2018, analysis finds

Dive Brief:

Ad requests across connected TV (CTV) devices have increased 1,640% year over year, per new data from independent video supply monetization firm Beachfront, included in a Broadcasting + Cable report. CTV ad requests reached nearly 30 billion in November 2018 compared to 1.7 billion the previous year.
Roku accounted for more than 87% of ad requests on CTV in November 2018, with Amazon’s Fire TV ranking No. 2 in terms of requests, up from fourth place. LG ranked third, followed by Samsung TV, Vizio and Chromecast.
Completion rates (VCR) for connected TV remained at more than 90% on average. VCR was higher on premium apps at more than 95% compared to 85% on long-tail content.

Dive Insight:

The huge jump in connected TV ad requests underscores the value that marketers are placing on high-value video content. The Beachfront report suggests that marketers shouldn’t view connected TV as an extension of digital or repurposed linear TV ads. Ad spend on over-the-top (OTT) TV content, which can be streamed on CTV and other connected devices, is expected to rise 40% to $2 billion in 2018, while spend on linear TV ad content is projected to grow 1%, according to a fall update to Magna’s U.S. ad forecasts for 2018. The increase in spend is linked to higher consumer adoption of smart TVs and set-top boxes. This year, 80% of U.S. households will be reachable via OTT.

Amazon’s Fire TV rising to the second spot in ad requests is the latest evidence of how Amazon is growing its ad business. Fire TV’s user base grew from 16% of streaming media players in 2016 to more than 25% in 2018, according to Beachfront.

Amazon has been beefing up its ad technology to manage ads on Fire TV and expand its capabilities for serving ads across the internet through its publisher network, with apps and publishers using Amazon ad services. The company is now taking a 30% cut of the ads shown to viewers on Fire TV, after previously letting publishers sell their own ads and take all the money. There are also reports that Amazon is building its own video ad serving product for OTT TV, resembling Comcast’s Freewheel and Google’s DoubleClick, that it would license.

Marketers are attracted to connected TV for its ability to offer audience targeting, cross-screen planning and buying, and addressability, with many leveraging data to target ads. Those who are already investing in advanced TV are seeing results. More than 90% of advanced TV cross-screen campaigns saw online sales lift, and a single financial services campaign saw a 462% increase, per a 4INFO analysis.