Illustration by Sarah Kim / Getty / The Current
CTV has transformed television advertising from a branding channel into one that works at all stages of the marketing funnel.
TV has long been the most effective brand-building advertising channel. But the emergence of connected television (CTV) is changing how marketers think about TV ad campaigns.
That’s because the digitization of television allows brands to merge the brand-building of traditional television with precision targeting, calls to action (CTAs), and conversion tracking of direct response marketing. As a result, brands are using CTV at not only the top of the marketing funnel, but also all its lower stages.
Hulu is a leader in direct response advertising on CTV, having incorporated call-to-action buttons over the past several years into its ad product offerings. In 2019, Hulu rolled out an ad unit with mattress manufacturer SleepNumber that allowed users to hit a button on-screen and have more information about the campaign sent to the email address associated with the Hulu account. More recently, the streaming platform incorporated QR codes into ads, prompting viewers to scan the code with their smartphone and receive a special offer.
With these call-to-action buttons, marketers can identify consumers who are actively interested in the campaign and retarget them based on email or phone data.
Disrupting the traditional TV advertising experience
CTV’s direct response characteristics have made it an enticing channel for brands that cannot otherwise afford TV advertising. For decades, television was the leading advertising channel for achieving reach and building brand affinity. With that came hefty price tags for television commercials, so ads were typically reserved for car, consumer packaged goods (CPG), and travel brands with sizable budgets.
With CTV, however, marketers can drive results more efficiently and track the return on ad spend more precisely, enabling smaller contender brands to afford the medium. It’s telling that when Hulu launched its QR code ads, it did so with direct-to-consumer brands SmileDirectClub and The RealReal.
Casey Null, director of strategy at ad agency Wondersauce, says CTV presents a huge opportunity, especially for brands priced out of linear, but cautions against brands taking a one-size-fits-all approach to CTV. CTV is a relatively new channel for most marketers, and brands and agencies are still discovering what works best in CTV, especially compared to linear TV advertising. “Viewers are still largely unfamiliar with what to expect from the CTV experience, so we’re designing ads to feel native to the specific formats and CTAs we now have at our disposal,” Null says.
Wondersauce has incorporated click-to-shop ads into some of its retail clients’ CTV campaigns; for instance, encouraging viewers to peruse the advertised products from their phones. The agency also advises brands to experiment with nontraditional advertising techniques, such as having a period of extended silence in the ad to hopefully direct viewers away from the little screen (their phones), and back to the big screen (the TV).
“TV advertising relies heavily on capturing and holding the viewer’s attention, a task that’s become even more difficult as a majority of viewers spend more time on their phones,” Null says. “We’re taking a nontraditional approach to CTV that aims to disrupt the passive viewing experience.”
Direct-to-consumer (DTC) brands are an obvious fit for using QR codes and calls to action in CTV ads, but CTV can serve as a performance marketing channel for retail brands as well, according to Eddie Dingels, CTO at mobile ad network GroundTruth.
Using location data culled from its mobile publishing partners, GroundTruth tracks foot traffic to retail and restaurant locations, and uses that data to judge the effectiveness of its clients’ CTV campaigns. Specifically, GroundTruth will compare CTV ad exposure to foot traffic data to see if a CTV campaign drove consumers into stores.
“One of the hard things with CTV is proving its efficacy. Everyone in CTV is talking about upper-funnel awareness, but the industry wants to validate that you got the right message to the right audience at the right time,” Dingels says. “This is a good metric for those in that space.”
Subscribe to The Current
Each week, The Current gives you a rundown of the biggest stories and latest trends from the world of data-driven marketing, including topics like Connected TV and the future of identity — all delivered directly to your inbox.
Explore how advertisers are embracing new opportunities on the world’s most influential advertising medium.