45% of Digital Political Ad Spend in 2024 Will Go to CTV
by Frankie Karrer
2 Min Read
With the strike throwing a wrench in streaming plans for 2024, many platforms are finding new ways to entice viewers to their services — and teaming up in the process.
5 Min Read
Every year, the last few weeks of Q4 are full of speculation on what’s to come for any given industry. And for streaming, the vibe we can expect for 2024 is now becoming apparent: the only thing that’s certain is that nothing is certain. But for streaming services, that chaos might just be a ladder.
With the strikes over and the industry poised for a comeback, it’s now a question of how fast content providers can get their TV shows and movies finished and released on their platforms. Despite the fact that there’s enough streaming content already available out there for viewers to watch for decades, one of the best ways to draw in new viewers (or to reclaim viewers who have dropped off) is by enticing them with some fresh stuff to watch. So as viewers wait for the content they were promised, streaming platforms will have to find new ways to appeal to those who aren’t willing to sit tight and stay subscribed.
In fact, like the pandemic — which fast-tracked the rise of Connected TV — we have a feeling the coming year will bring upheaval to the industry status quo. Which is why your CTV advertising strategy for 2024 will need to be able to rise above the chaos (but more on that later).
One of the ways streaming services are fighting to attract viewers in such a tumultuous era of television? Bundles.
Verizon recently announced that they’re launching a new bundle for their subscribers, which will give them access to ad-supported content on Netflix and Max for only $10 a month. And for just $10 more, those same subscribers could add Hulu, Disney+ and ESPN+. That’s 5 services for the same price as the highest, ad-free tier of Netflix’s own offerings.
And if you’re a Disney+ user, you may have already noticed a big change to their platform. After buying out the rest of Comcast’s stake in Hulu last month, the streaming service had the opportunity to make good on their plans to combine the two services. And last week, users were suddenly able to access Hulu content through their Disney+ platforms — a united front that creates a combined library with one-third of the 100 most popular titles in the US.
Not wanting to be left out of the race for allies, Apple TV+ and Paramount+ are also in discussions to establish a partnership, according to the WSJ. For these two streamers — who have considerably less of a presence in the market than some of their larger counterparts — this alliance could mean a chance to stand out in the streaming wars like never before.
Ironically, these allegiances mirror the old days of cable TV bundles while still giving smaller platforms the opportunity to challenge the champ of CTV — Netflix — for market share. But with consumers saying they want to pay less for all these subscriptions, and streamers wanting viewers to stop jumping ship in favor of the cheaper, rising stars that are FASTs, it might be just the move to keep everyone happy.
Ultimately, when streamers play the game of bundles, they win or they shutter. And 2024 will likely be the year we start to see the impact these partnerships have on their bottom lines.
All of this upheaval is coming at what is already a tipping point for TV advertising as a whole. A recent report from GroupM has revealed that CTV ad revenue will grow by 13.2% globally this year, reaching $29.2 billion. This will bring the channel that much closer to passing linear and generating more than half of all TV revenue — a turnover that GroupM expects will occur as early as 2026.
Unfortunately, that likely won’t be enough to completely offset the losses of the TV industry at large, which dropped by 17.9% this year, thanks to linear’s losses. And with linear TV revenue dropping off and the percentage of ad-free CTV viewing growing to 30% over the next four years, Group M anticipates that available TV advertising hours could drop by as much as 17% by 2028.
All this really means, though, is that CTV advertising is about to become very valuable real estate. Consumers having less interaction with advertisers (on TV, at least) will mean their tolerance for imprecision will be much lower, and every ad will need to count. But for consumers, better, more intentional ads can only be a good thing — and happy ad watchers become happy consumers.
What does this mean for advertisers? Well, it depends on how all of these bundles shape up.
Ad-supported bundles like Verizon’s should mean a chance to solve some of the aforementioned inventory problems. But we still have yet to hear whether all of the bundles will feature ad-supported tiers. (We have a feeling the Apple TV+ and Paramount+ partnership will be ad-free, thanks to the former’s current lack of ads.)
Nailing your audience targeting is essential to weathering whatever comes of the ad inventory shake-up. Consumers are already more inclined to pay attention to ads that are accurately targeted to them, and when inventory is harder to come by, targeting can make or break the success of your campaigns. That’s why working with an advertising partner like MNTN Performance TV that takes an audience-first approach to Connected TV is essential in a time of flux. Besides, a performance-driven platform and robust measurement capabilities can ensure you’re getting the best bang for your buck in any climate.
Ultimately, most of these bundles and inventory problems are still up in the air, and we have yet to see how they’ll impact the TV industry at large. But for advertisers looking to get ahead of the game, working with the right Connected TV partner can help you be prepared for anything.
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