It’s (still) complicated: Our analyst Paul Verna agreed fragmentation is a pain point for CTV. “As a buyer, you might be buying an ad from a device company, or a TV network, or an aggregator, or a set-top box-maker. Really any number of companies that are in that value chain,” he said.
- Many publishers are still relatively new to CTV, and that doesn’t help the cause. Hopkins said cross-platform and cross-publisher tools will be vital to marketer adoption of CTV.
“The viewers are there [for] CTV, and the advertisers are doing a fast follow,” Hopkins noted about CTV’s positives.
Speaking of positives: In the US, CTV is the fastest-growing ad format we track, with a projected growth of 27.2% in 2023, for a total of $26.92 billion. By contrast, we project US retail media ad spend to increase by 20.5% and US social network ad spend to grow by 8.8% in the next year.
“CTV is a performance medium,” Hopkins said, meaning it doesn’t only inform top-of-funnel impressions. Marketers can look not just at “how many eyeballs you’re reaching,” but also at how CTV drives action.
- That action is encouraged by campaign creativity and especially by shoppable ads. Shopping behaviors of younger people are more malleable, and people under 25 years old account for more than a quarter of CTV users.
- Some 90% of Gen Z adults in the US use the internet and TV at the same time—more than any older generation—so advertisers can count on younger viewers being on two screens at once.
Everyone’s a winner: Ad-supported video content benefits consumers and advertisers alike, according to Hopkins, expanding the availability of streaming content.
- The viewers are already there. Next year, 230.0 million people in the US will use CTV, accounting for 67.8% of the population. By the end of 2026, 7 in 10 people in the US will be CTV users.
- Marketers are meeting TV viewers where they are, which explains why CTV ad spend has grown by more than 50% each year between the start of our forecast period in 2018 and this year.
- In 2023, CTV will account for 16.5% of all US display ad spend.
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