Creating a Winning CTV Strategy: An Introduction

With small kids and a full-time job, my morning routine can vary widely. However, I’m embarrassingly predictable in some ways: I wake up, raise the shades, and — here goes — grab my phone. It’s the third thing I do in my day, sometimes even second on the days I prefer seeing the glow of content stream from my phone versus the sun.

It wasn’t always like this, however. Not that long ago, I’d wait until I was dressed and had coffee in-hand before turning on the TV to connect with the world — or even open a newspaper! Today, our instant connection to news and information — plus our friends and family — is now second nature. So, it’s no surprise the same trend is permeating how we consume content.

Odds are the last time you tuned into that new detective show or your favorite sitcom, you didn’t pick up the good old TV Guide off of the coffee table and plan to be on the sofa by 8 pm. You probably used Connected TV (CTV). CTV refers to devices, like smart TVs and gaming consoles, connected to the internet that allow you to stream digital content — dare I say it — instantly! 

The streaming market as a whole is growing at hyperspeed as more viewers cut the cord and seek ways to engage with their preferred content across multiple devices. In fact, studies show a greater uptake among households, enabling stronger audience reach than traditional TV. And the advertising spend is following suit. CTV ad spend grew from less than $10 billion in 2020 to $20.7 billion last year and is projected to exceed $40 billion by 2027.

Much like my trusty iPhone by my nightstand, CTV cannot be ignored. Audience behavior is already there; streaming TV is the go-to. You could arguably say the hardest part is already done. So, publishers, streamers, and advertisers should get acquainted with the core elements of CTV, if they haven’t already. 

That’s where we step in. Our team here at Wurl is launching a dedicated blog series to walk you through the essentials to help you build, deploy, and uplevel your own CTV strategies – from distribution to monetization and marketing.

In the first installment of this series, we’ll start by explaining the nuts and bolts of CTV before highlighting its benefits and challenges. From there, we’ll give you an overview of what to expect from the series in the weeks to come — and how staying tuned in will help you finetune your CTV strategy, grow your brand as a streamer or publisher, and connect you with prime audiences. 

To kick it off — if you’re new to the CTV market — here’s your secret decoder ring of core terms. We’ll refer to these a lot, so keep ‘em close!:

• Linear TV vs CTV: Linear TV refers to traditional TV, which broadcasts content on a predetermined — “linear” — schedule. While CTV includes linear-style content (namely, Free Ad-supported Streaming TV, or “FAST”), unlike linear, it also includes video on demand (VOD) content. 
• OTT vs CTV: OTT (Over-The-Top) is the delivery of content directly from the internet on various devices (including tablets, smartphones, computers, and TVs) by services and providers (think Netflix, Hulu, Disney+). CTV refers to devices like smart TVs, gaming consoles, and other connected devices like Apple TVs and Amazon Fire Sticks that allow users to stream content. 

Understanding the CTV landscape

How does CTV work?

Connected TV is the magic that happens when you connect your smart TV to the internet and — voila — you have channels! These channels can be, as mentioned in our core terms section, linear, VOD, free ad-supported, or behind a paywall for premium content. No matter which format you choose, it’s TV you get by connecting to the internet instead of broadcast or satellite. Gone are the days of dishes and set-top boxes.

These channels can be accessed by viewers in a few ways: it might be through your TV, itself (like LG channels when you connect your LG TV), through an external device (like your Apple TV box), or through an app installed on one of your devices (like Freevee). The channels are usually sent to that platform from a number of technology providers who originate and send linear and VOD streams of content based on a schedule created by publishers directly to those platforms. The flow looks kind of like this:

These channels can vary from library content strung together in a 24/7 linear experience, to live event coverage and news.

A few things that are key to think about when building a CTV strategy from the ground up are that:

• It’s dynamic (can be manipulated fairly quickly)
• It involves much lower costs for the publisher (no fancy satellite equipment needed)
• It lends itself well to targeted ad strategies (you really know who is in your audience!)

How do CTV ads reach viewers?

There are three primary ways to monetize your content: through AVOD, SVOD, and FAST channels.

• Advertising-based Video on Demand (AVOD) refers to TV content that monetizes itself through ads (for example, Peacock).
• Subscription-based Video on Demand (SVOD), on the other hand, refers to content that’s accessible via a monthly fee, and usually without the inclusion of ads (like Netflix and Hulu). However, more SVODs like Netflix and Max are introducing more ads to improve their business approaches.
• Last but not least, FAST combines the best of traditional TV’s linear programming format with the technological capabilities characteristic of streaming. Ads appear during scheduled breaks, like with traditional TV, but are better personalized to audiences. Examples of FAST channels can be found on platforms like Tubi and Pluto TV. 

How much does CTV advertising cost?

CTV advertising offers more flexibility and cost efficiency than advertising on TV traditionally has. The TV advertising cost for linear can be steep for advertisers, with big budget commitments required up front. CTV advertising, however, can be purchased on a monthly basis. 

Linear TV gives advertisers two options: “spots” or “network.” You can buy airtime — or, a TV “spot” — for a commercial on a cable system at a specific time of day and/or before a certain program. These ads are purchased from cable providers and only appear to their subscribers (you can also go through an advertising agency that works with cable providers). With spots, you can either go local and have ads shown in specific cities or geographic areas, or go national with large networks like ABC or CBS. With “network,” you buy airtime directly from a national cable channel like NBC or TNT. These are usually more expensive than TV spots. 

With CTV, not only can you buy traditional commercial-style placements, you can also buy display banners, pop-up ads, and interactive ads that allow viewers to take direct action with their phones or remotes. These ads show up before, during, alongside, or after content. You can buy CTV ads from smart TV manufacturers like Samsung, streaming stick manufacturers like Roku, and video streaming services, themselves. 

Pricing for traditional TV advertising revolves around Gross Rating Points (GRP), or the percentage of a target demographic that an ad reaches multiplied by the number of times they’ve seen the ad. But, the ability to measure the impact of your campaign based on GRP throws in a lot of guesswork (you can’t really get crucial insight into information like viewership location, for example). For CTV advertising — which can be highly targeted to audiences you want to reach and comes with detailed analytics and viewer insights — pricing is determined by the Cost per thousand (CPM), or the cost for showing an ad 1,000 times. 

Overall, you’d be hard-pressed to measure the success of your linear TV ads and see if the pricing’s worth it. There’s little guarantee that your target audience will watch your commercials (you can only really target based on ratings and times of day) and also no way to track conversions. With CTV advertising, however, you can calculate return on ad spend (ROAS), cost per completed view of your ads (CPCV), site visits, and much, much more. Not only can an advertiser monitor their campaign’s success — they can also measure their brand awareness and customer lifetime value. 

What are the benefits of CTV advertising?

CTV advertising strategies serve targeted ads to audiences with a device and internet connection — viewers that traditional TV is unable to access.

• For streamers and publishers: This offers better reach and raises the potential for getting more viewers to convert (e.g. download your streaming app). On top of that, with 48% of viewers saying these ads help them discover new content, new streamers and publishers looking to grow their channels — or more established ones looking to expand into new markets — stand to greatly benefit from advertising across CTV.
• For brand advertisers:  CTV advertising enables them to expand brand reach beyond retail environments to the places where their customers are already consuming vast amounts of content.  

Here’s a closer look at CTV advertising’s benefits:

• Personalization: You can connect your content to the right audiences with precise audience segmentation. Ad delivery is tailored to consumer behavior, interests, demographic insights, and other customer viewing preferences and choices through tools like AI.
• Measurement: Tracking lower-funnel metrics and KPIs — such as Impressions, Viewability, Completion Rate, Click-Through Rate, Return on Ad Spend (ROAS), and Site Visits — happens hassle-free, in real-time.
• Cost: Because measurement and personalization with CTV marketing is more efficient and flexible — and without the steep costs and unknowability associated with traditional — it’s easier to connect the dots. You can maximize ROAS and shrewdly allocate funds to improve ads or redirect them to other facets of a more holistic campaign rollout. 
• Resonance: CTV marketing powerfully complements your team’s media mix so you can find people who will resonate with your content. Let’s say you’re a new FAST channel: your CTV digital marketing campaign will reach a plethora of the right eyeballs when you use CTV marketing together with mobile and web advertising to market content. 

Craft a winning CTV strategy with Wurl

Although CTV market share will continue to grow and CTV marketing offers powerful opportunities for streamers, publishers, and brand advertisers alike, it is still a new industry with many growing pains. The most pressing of these is the increasing number of platforms and channels entering the market, making it more and more difficult to attract, retain, and even reach audiences.

This series will cover current industry challenges and uncover the steps you need to build your CTV brand. In future posts, we’ll dig into how to get started, distribution, CTV ad monetization, performance marketing, and more. 

Throughout, we’ll also outline how our key offerings at Wurl can help empower your strategies and deliver impressive results. We offer AdPool (which monetizes every ad impression), ContentDiscovery (which attracts, engages, and retains viewers at a massive scale), and Global FAST Pass (which globalizes and monetizes your CTV content). 

Be on the lookout for our next blog post, where we’ll lay out the foundations for bringing a solid CTV strategy to life. And, in the meantime, stop looking at your phone!