Many advertisers realize the massive potential of over-the-top (OTT) advertising. Still, they need to catch up on the rising relevance of programmatic approaches to enhancing OTT advertising success. Without programmatic, OTT’s targeting capabilities limit its potential, but with it, your brand will have the unbeatable advantage it needs to succeed. That claim, taken by itself, may seem too good to be true. However, research contradicts this. Pixalate predicts that programmatic OTT/CTV advertising can now reach 72% of U.S. households, up from 59% in Q1 2020. Most programmatic OTT/CTV ads (49%) go to Roku devices, which backs up eMarketer’s prediction that OTT/CTV programmatic ad spending grew by up to 52.9% in 2021.

The prevalence of CTVs is increasing as the epidemic spreads. It’s like purchasing TV ads online, but cheaper. Audiences can do everything they do on a smartphone. Then, with a smart TV, you can watch YouTube, access online theaters, browse the Internet, and listen to music through Apple Music applications, all on a much larger screen.

Currently, 39% of individuals regularly use CTV to view videos, and 82% of households own at least one internet-enabled television set (smart TV or linked TV). Therefore, CTV has evolved into an effective marketing method that requires immediate attention. Hence, in this article, we’ll talk about the top 5 advantages of programmatic advertising for OTT campaigns. However, let’s first understand what this entails. 

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What is over-the-top programmable marketing?

To simplify, over-the-top (or OTT) content distribution occurs when a user’s movie or television program requests are met by a service that bypasses traditional distribution channels. Advertisers may target these cord-cutters through streaming platform ads via over-the-top (OTT) advertising.

The term “programmatic advertising” refers to computerized systems to buy digital advertising space that is very particular to the target market’s demographics and is carried out by algorithms tailored to the advertiser’s objectives. It is a replacement for the time-consuming and in-person techniques of negotiating and making demands, and it takes place in a matter of milliseconds.

They provide an advantage over almost every other tactic available today. Programmatic over-the-top (OTT) advertising is the automated and individually tailored process of trading digital ad space between advertisers and publishers through streaming services and connected TV (CTV) devices like smart TVs using real-time bidding.

This is the end result. Thanks to adaptable features, you may reach more people in less time, have more meaningful interactions with sellers, and get greater results from your prior efforts.

What is Connected TV (CTV)?

The term “connected television” (CTV) appears in the media buyer’s dictionary in connection with internet-enabled televisions (such as smart TVs) and streaming devices.

The CTV ecosystem consists of the following components:

  • The term “smart TV” refers to sets with an operating system that allows for web browsing and various streaming services. Only Internet-connected smart TVs will be eligible for CTV status.
  • A set-top-box, sometimes known as a streaming stick, is a piece of hardware that may be plugged into a TV to have access to
  • Video game console selection – these units support playing and streaming media.

What are the characteristics of programmed CTV?

Definition of “Programmatic” in Advertising Programmatic purchasing and programmatic advertising are two more names for this practice. Essentially, you are trading advertising space.

With the same foundation as other programmatic ad formats, programmatic CTV ads are put on the platforms of media firms (streaming services). This kind of commercial production is appropriate for TV and Internet-enabled gadgets. The primary advantage of programmatic CTV over direct media purchasing is the time savings it provides.

Instruments for measuring programmed CTV

If you would like to measure the success of your connected TV advertising campaign, there are better metrics to use than clicks. Clickthrough rates can be calculated only on mobile devices that allow users to stream video. Which metrics for CTV campaigns perform best, then?

The success of a CTV ad may be measured in terms of the company’s cost per completed view (CPCV), video completion rate (VCR), and CPM (cost per mile or cost for every 1000 views). The lower the cost-per-completed-view, the more money advertisers will save.

Targeting many devices

With CTV, you can expand your potential audience to include more gadgets. According to the statistics, 90% of people use their mobile devices while watching television. Businesses must implement a “double-check” system. It’s the practice of showing commercials to a certain demographic of CTV viewers before showing the same commercials to the same demographic on mobile devices.

As a result of this improvement, advertisers can gauge CTV’s effectiveness more precisely. A programmable DSP may be used to target a wide range of devices. 

SEE ALSO: The Most Exciting Digital Marketing Trends for 2022

5 advantages of programmatic advertising for OTT & CTV campaigns

What distinguishes CTV advertisements from OTT advertisements?

Over-the-top (or OTT) refers to transmitting media over the internet. This technology makes it possible to view videos on any gadget (computer, smart TV, tablet, or smartphone). Users of CTV devices may watch TV while also seeing OTT and CTV advertisements. Among the many over-the-top (OTT) video providers, Netflix, Hulu, Amazon Prime, & Disney+ are the most well-known.

Ads for CTV and OTT may now be bought and delivered programmatically using the Demand Side platform. So, how are over-the-top (OTT) advertisements different from those on cable television (CTV)? Marketers may reach consumers who don’t have a TV in their homes through OTT (over the top) since the term refers to the method of content delivery rather than the viewing device.

Why programmable over-the-top advertising is important

In a nutshell, programmatic OTT advertising is significant because over-the-top (OTT) platforms continue to gain ground over cable TV, and programmatic approaches enable advertisers to make the most of a proven advertising strategy in real-time.

Successful campaigns depend on reaching target audiences when and where they are receptive to the message. When reaching your target audience, OTT is where they are, and programmatic is the most effective method.

Programmatic over-the-top (OTT) advertising is relevant due to the growing popularity of streaming services alone and its potential in other areas. For instance, in light of recent developments in the field of advertising, businesses are expanding their strategies to incorporate CTV, SVOD, and AVOD in an effort to reduce the creative ad fatigue that can result in disinterested customers and to make better use of the advantages offered by non-skippable and semi-frequent commercials, a more constantly participating audience, and more customer information than ever before.

Since the OTT industry is predicted to expand at a CAGR of 29.4% between 2020 and 2027, media buyers may benefit from OTT programmatic advertising by realizing they are purchasing precious space and time with a highly specialized target audience.

What are the advantages of programmatic advertisements for OTT and CTV?

In 2022, 76% of video marketers across all industries rated linked CTV advertising as a must-buy for their media strategies. Marketers have found that various tactics, including premium inventory and audience targeting with substantial user participation, provide the best results. In addition to reducing the price of advertisements, they will be shown in a highly visible location.

In addition to the rise of CTV, advertisers have four key reasons to use programmatic television advertising:

Workflow automation

Marketers have long seen linear TV as a complicated digital advertising setup. Video publishers may streamline and mechanize their programmatic ad operations using CTV. Placement of CTV inventory is possible using the same demand-side platforms (DSPs) and advertising networks used to offer traditional media. It is via these mediums that the advertiser’s message reaches its target demographic.

Viewers are engaged

According to the State of CTV Advertising Report, interactive CTV formats had a 1.1 and 10.3 times greater watching completion rate (88% vs. 3.4%) and engagement rate (3.4 vs. 1%).

Brands must be creative with utilizing the network’s private information to tailor advertising to individual users. Users of CTV are incentivized to view the advertising, increasing your chances of reaching customers and maximizing your income.

5 advantages of programmatic advertising for OTT & CTV campaigns

Precise audience segmentation

Advertisers may use linked TV advertising platforms to monitor a wide variety of user behaviors, including where they are, what they do online, what they search for, what web browsers they use, and more. And then, using psychographic, demographic, and contextual characteristics, programmatic TV advertising may get your brand in front of the right people. Programmatic TV commercials may save you money compared to traditional linear TV ads.

Attract a wide and increasing demographic

An inclusive viewership is ensured through a connected TV. Both the young and the elderly might be exposed to your advertisements. Advertising on programmatic television has the bonus of rapidly expanding. By 2025, there will be 62.6 million millennial viewers.

Uses sophisticated algorithms

As more businesses adapt to the growing popularity of streaming services, the window of opportunity to cash in on these shifts will close. Before most companies in your sector realize what it is, its worth, and its future potential, getting on track will help you not only enjoy the rewards sooner but also reinforce your knowledge and plan. If you wait too long to take action, your competitors may jump on you, leaving you to play catch-up.

Beyond the obvious marketing benefits, the rise of programmatic OTT advertising can be attributed to the increased trust between buyers and sellers that results when ads have more relevance to the target audience than high-frequency ad spam that has little to do with the individual’s actual purchase decision process. Stronger connections between buyers and sellers are built on a foundation of trust.

Programmatic improves over-the-top (OTT) chances by providing a more efficient target audience, a larger audience, faster bidding and purchasing, and a tailored experience to an audience more likely to be receptive to your product or service.

According to MediaRadar, by Q2 2020, 83% of digital marketers will use programmatic ad tech. This is up from 76% one year ago when just a fraction of these firms used programmatic advertising. There is no stopping the rise in that figure.

Because of its potential to win impressions based on location, online/offline habits, and other personal information that makes the ad relevant to the customer, eMarketer predicts that programmatic OTT advertising ad spending will increase by over 60% within the next year. As more of its features are revealed, that proportion can only rise.

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Raise the bar with over-the-top programmatically-driven ads

Getting your message out to the correct people has always been difficult in marketing, and it likely always will be. However, with programmatic OTT advertising, your brand’s skills will receive a much-needed boost. When competing with considerably more efficient automated tools that can do in a second what would take people days to do, old ad purchasing tactics will put a stop to your company’s potential. To stay ahead of the competition and in front of your target audience, you must integrate programmatic and OTT immediately.

Continue reading iTMunch for the latest news and articles related to programmatic advertising. Learn more about our programmatic advertising.

SEE ALSO: 10 reasons why your brand should adopt programmatic advertising NOW!

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