The Year of Ad-Supported Streaming
Just in case you haven’t noticed, digital video is everywhere — and reaches about half the entire population. According to eMarketer, 3.78 billion people will watch digital video content in 2024. And this year, ad-supported streaming tiers and platforms are taking over, creating an incredible opportunity for advertisers to reach their target audiences.
With this in mind, marketers are reevaluating their television marketing strategies to reach their audience where they’re already watching their favorite content. Here, we’re going to explore why 2024 is set to be the year of ad-supported streaming and how you can make the most of it with Connected TV (CTV) advertising.
The State of Streaming
With a 13.2% global growth rate in 2023, it’s safe to say the CTV industry is still going strong. As the cost of streaming rises and the industry continues to fragment, users are taking advantage of ad-supported streaming to keep costs lower — and we’re expecting advertising-based video on demand (AVOD) to continue soaring in 2024.
More platforms, including Netflix, Spotify, and Amazon, are adding ad-supported options, and free, ad-supported streaming television (FAST) platforms are more popular than ever before. One survey found nearly half of US households — 47% — tune into FAST platforms every week, and most of these viewers also believe FASTs deliver great value.
Plus, growth for sports is expected to continue as the major players make their way to streaming services. One survey expects 126.8 million people to watch digital live sports in the US by 2027.
Streaming Ads Are Here To Stay
Since CTV has ad solutions for both B2B and B2C brands that can weather many of the television industry’s challenges, many marketing teams are allocating more of their budget to CTV and OTT platforms. As MNTN explains, “As a result [of more ad placements], eMarketer predicts that Connected TV ad spend will have a massive 21.2% surge up to $25.09 billion, outshining the rest of the media market.”
This increase — combined with the performance marketing features of the platform — has made CTV increasingly important in marketing strategies. MNTN Research found that 76% of advertisers said CTV is either moderately or very significant to their advertising campaigns.
CTV Ad Best Practices
As the ad-supported streaming arena becomes more competitive, it’s essential to follow best practices.
Understand Your Audience
Once you understand your audience, you can craft your strategy around their likes, dislikes, and streaming habits. Knowing whether your audience is a bit ad-adverse (ad-verse?) or loves commercial breaks can help you steer your video production in the right direction. An audience-first strategy allows you to connect with viewers more effectively, driving more engagement while remaining within your budget.
Test Multiple Ad Variations
You’ve probably had some feelings about ad fatigue lately. Believe it or not, your audience has, too. According to MNTN Research, “67% of consumers want a variety of different storytelling approaches to avoid ad fatigue.” To keep both yourself and your audience happy, you’ll need to test multiple variations of your ad creative.
Through multivariate testing and analysis, you can understand which elements of your video creative resonate most with your audience. Do they prefer a certain CTA or a certain video style? Once you have enough data to analyze, you can see which particular elements and combinations of those elements connect best with your viewers.
Optimize Your Strategy
With essential information about your audience and the ad creative they prefer, you can optimize your strategy to make the most of these insights. For example, if you find out that your audience prefers live action content over animation ads, you’ll want to make your next production live action. Even small changes can make significant impacts, so keep an eye on each individual element of your content strategy.
As you spend more time airing ads on streaming platforms, you’ll be able to optimize your campaign to meet the needs of your business and audience, which will then drive more engagement. And if you’re just getting started, you can use insights from other platforms — like social media video ads — to give yourself a starting point.
Staying Ahead in the Year of Ad-Supported Streaming
As 2024 unfurls, ad-supported streaming is going to evolve. While you’ll want to keep an ad-supported streaming strategy (say that five times fast) in place, it’s also important to leave room for flexibility. By staying ahead of the streaming curve with the latest information and maintaining an adaptable strategy, your brand can make the most of your budget and other resources to create an impactful CTV strategy.
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