Back in the pre-COVID times, 2020 was already set to be the year that streaming video finally took over the TV industry. Just days from 2022, the revolution is transitioning into an evolution: Legacy broadcasters like NBC (Peacock), CBS (Paramount+ and Pluto TV) and Fox (Tubi) have launched or acquired their own ad-supported video on demand (AVOD) or hybrid subscription-based video on demand (SVOD)/AVOD outlets in response to the rise of SVOD giants like Netflix, Amazon Prime Video, Hulu and Disney+. The TV advertising ecosystem has moved away from traditional measurement metrics in search of cross-platform solutions so advertisers can follow the viewer and consumer from screen to screen and linear to streaming platform.
As diversity, equity and inclusion issues continue to be top of mind in the ad industry—in fact, "diversity" was the Association of National Advertisers' 2021 word of the year, beating out "cookie-less," "metaverse" and "customer experience. The sell-side ad platform Magnite recently published a study, "CTV Is for Everyone," which examines how as traditional TV viewership has declined in scale, its audience has continued to age and become increasingly homogeneous. In contrast, as the CTV audience has grown, it has captured a more diverse demographic. Katie Evans, Magnite's chief operating officer, shared details of the report at Ad Age Next: Streaming in November.
A reflection of America's diversity
"Our research found that CTV audiences better mirrored the U.S. population across a number of demographic factors including age and race compared with linear TV," says Evans. "It's important that brands start looking at the diversification of their budgets to make sure they're reaching the consumers that they truly want to reach."
According to Magnite's research, the CTV audience mirrors America’s diverse population, whereas the traditional TV audience skews white and older—54% of traditional TV viewers are over 55 years old—and consequently under-delivers against Black, Latino and Asian audiences and 18- to 40-year-olds. The study also finds that CTV households are more likely to be multi-generational than traditional TV households. According to a new study from market research firm Horowitz, Black households are increasingly cutting the cord at a faster rate than others. One consideration that likely shapes how Black Americans watch content is the availability of culturally relevant programming, with 60% of Black consumers saying they watch content that’s specifically geared to Black audiences at least weekly.
More CTV watching, more CTV ad opportunities
The bingeathon that began during the first year of the pandemic lockdown carried over into 2021, but as expected, streaming has dominated viewing habits. "Over the past year, one of the major differences that we saw was that although people watched TV more across the board, CTV viewers reported watching 50% more than traditional TV viewers," says Evans.
SVOD shows undoubtedly seem to dominate the virtual water cooler conversations on social media, but "ad-supported CTV is now watched nearly as much as subscription-supported ad-free content," says Evans. "Viewers are essentially saying they are okay with watching ads in exchange for access to content and a lot of services are offering that choice to consumers." CTV audiences are more willing to share information to receive relevant ads, more likely to pay attention to targeted ads and twice as likely to make a purchase after seeing an ad than traditional TV viewers, according to Magnite's study.
A more trusted environment
A surprising revelation from the research was TV viewers' increasingly negative opinion of social media, regardless of whether they are traditional TV or CTV viewers. As partisan political beliefs have increased among consumers, 37% of CTV viewers say they distrust social media more now than they did a year ago. Despite the push to emphasize brand videos on social, 60% of CTV users who also use social media say they do not watch professionally produced content on those platforms, typically preferring to watch CTV for such content. And only 21% of CTV users are likely to pay attention to a video ad on social media.
"There's a clear difference in mindset when a consumer is watching CTV versus when they're scrolling through social media and that plays into the success of that advertising," says Evans. "CTV provides a more trusted environment for consumers to access engaging content and provides advertisers with a more controlled ecosystem to connect with consumers."
For more insights, download Magnite's report "CTV is for Everyone."