CTV Market Predictions for 2023: Past the Tipping Point into Full Market Acceptance

Wurl Editorial Team - January 19th 2023

After a breakthrough year in the ad-supported streaming business, Wurl’s leadership team shares their thoughts on what lies ahead.

2023 is poised to be streaming’s biggest year yet. More and more brands are introducing free ad-supported streaming TV (FAST) offerings, with the FAST market expected to reach $4.1 billion this year.

This, coupled with viewers’ increased acceptance of ad-supported streaming, hints that the CTV boom is likely to continue – even in the face of an uncertain economic climate.

“One major positive as we head into 2023 is that TV appears to be recession resistant.”

Sean Doherty, Sr., Wurl CEO & Co-Founder

As the CTV market matures,  Sean Doherty, Sr. predicts how this year will see more viewing options for consumers and more advertising opportunities for brands. “Typically, people watch a lot of entertainment during economic downturns. And while individuals might cut down on vacations or buying things, they’ll always want entertainment,” he explains. “With Hulu, Netflix, and all the major streamers now offering less expensive versions with ads, there are new, scalable ways for brands to reach lean-back consumers. Smart brands and agencies will realize that the streaming screen is where the eyeballs are.”

The rapid growth of FAST, too, represents a sea change in the entire CTV advertising ecosystem. Brands now have the ability to not only efficiently reach more consumers worldwide, but precisely target audiences and measure campaign effectiveness with the right tools.

“In 2023, we’ll likely see brand advertisers move a big percentage of their budgets from traditional brand spend to performance advertising.”

Kris Johns, Wurl SVP, Advertising

The seismic shift in advertising made possible by FAST means the opportunity to monetize content via advertising grows stronger for Content Companies and Streamers.

Ad-supported offerings enable advertisers to connect with highly engaged global audiences – and, while streaming has traditionally been thought of as a brand marketing channel as opposed to a performance channel, new technology is enabling marketers to shift focus to campaigns that are scalable, addressable, and measurable.

This cost-effective approach is even more valuable in today’s choppy economic waters, as Kris Johns explains. “As budgets tighten, the focus on data will increase – we can expect to see an emphasis on analytics and performance with CTV.”

Ad-supported streaming’s success is driven by data, and the need for absolute measurement capabilities here is paramount.

“Standardization of measurement is long overdue and it’s time for a reckoning.”

Sean Doherty, Jr., Wurl COO & Co-Founder

A more consistent approach to viewership data is understood as a requirement for advertisers, media buyers, and programmers to meaningfully transact. We’ve already seen examples this year of industry players aiming to make a unified currency, such as OpenAP’s announcement that it will create a joint industry committee focused on harmonizing viewership data across multiple streaming services.

As Sean Doherty, Jr. explains, it’s been an industry-wide challenge to get there, “Content Companies measure their own viewership: How many people watch this? How long did they watch? How should I value this piece of content? In the same vein, each Streamer has their own reporting dashboard and a Content Company has to go into the dashboard, download the data, or look at the data and compare it to other Streamers’ data.”

Solving for the lack of standardized measurement will ultimately better serve all parties in the streaming ecosystem, Doherty, Jr. predicts: “Of course, there is little overlap in the presentation or data fields: What is considered a user? How do you define what a user is? Did they watch for 30 seconds? These are questions we must answer to create greater efficiencies both for content creators and advertisers buying on top of that content.”

Regardless of the growing pains FAST and the streaming industry as a whole is experiencing, the increasing importance of data is clear.

“2023 will be the year of data.”

Yuval Fisher, Wurl SVP, Technology

The rapid growth of FAST and CTV, as well as data’s critical role in their success, will continue to evolve. Yuval Fisher explains, “In 2021, we saw everyone dabbling in CTV. In 2022, people committed budgets to CTV and realized they could make money with it. Now, as we head into the new year, the focus will be on optimization through really starting to utilize the data that CTV makes available,” he said. “From scheduling and UA data to performance and behavioral data, CTV players will seek out more granular and specific metrics to boost performance and revenues.”

Will these Wurl predictions come true in 2023? Time will tell. But, what’s clear is the way television is consumed has changed significantly in the last decade – and will continue to do so in the coming year. Another certainty: More content will continue to deliver even more opportunities to the CTV industry. And so long as FAST continues to deliver the content that audiences love, good things will happen.