Accelerated by the pandemic, TV consumption is changing and continues to decline due to fragmentation in the space. Traditional TV consumption on a single TV is quickly transitioning to increased on-demand streaming across multiple devices.
Changing technology, paired with evolved TV watching, requires pharma marketers to modify their traditional approach to TV investment. Pharma has invested heavily in TV due to its reach capabilities, but now with Connected TV advertising (CTV), marketers can be even more savvy by reaching highly qualified audiences on TV more efficiently to drive brand impact.
What is Connected TV (CTV)?
- Connected TV/Over-the-Top (OTT) advertising allows marketers to deliver their TV spot within streamed programming (I.e., Hulu, Sling, Roku, FireTV etc.).
- Traditional TV/Addressable Linear are TV spots delivered via a broadcast through a cable or satellite company.
The State of TV Watching
TV consumption is changing and continues to decline as more options become available to engage with content. According to a recent MoffettNathanson study, traditional TV is down to 61% of occupied households in the US. By 2024, the number of traditional TV homes will be equal to the number of streaming only homes.
Not only are the number of connected devices per household growing, but so is the amount of time people are consuming content via CTVs. Over the last decade, CTV consumption has increased from 1.7 hours to 7 hours!
The trends are only projected to continue growing, with 82% of homes in the US already owning at least 1 CTV and 95M expected to cut the cord by 2023 according to eMarketer. Based on this growth, projected CTV ad spend is slated to hit $19B this year.
Why Should Pharma Consider CTV
Given the shifts in TV viewing, with projections soon to be 50/50 between traditional vs. CTVs, Connected TV advertising investment is something pharma marketers can no longer ignore. It allows a continued presence in TV, but where consumers are engaged more efficiently.
CTV has many of the perks of digital tactics, such as advanced targeting, optimizations and impact measurement. These benefits are:
“CTV will be coronated as the preeminent digital channel for healthcare advertising” Deep Intent1
- Reach: Audiences are increasingly migrating to CTV as more users and households migrate to the “cord cutting” world. 57% of reach achieved from streaming last year was incremental to linear TV buys (Deep Intent)1, meaning customers are being reached via CTV that wouldn’t have been by just marketing in linear.
- Targeting: Third party audiences can be leveraged in CTV, which allows for a more targeted experience. A Deep Intent study shows that CTV is more effective at reaching relevant audiences, with 82% higher on-target reach and 50% higher audience quality1.
- Efficiencies: The cost to reach a qualified audience is much more efficient than linear TV
- Engaging: CTV ads are also reported to be highly engaging by consumers, with much attributed to the fact that they are not skippable in most programming. 90% surveyed in an IAS study mentioned “there are features of the CTV ad experience that make it better than linear TV”.
- Measurable: CTV allows for KPI monitoring for ongoing optimization for increased impact.
CTV Proving to Be More Efficient and Impactful
As more brands embrace CTV as part of their strategy, they are seeing compelling results. CTV is promising higher audience quality and ROI when compared to Linear TV and in some cases, their digital channel counterparts.
In a recent study by Deep Intent, CTV audience quality was proven to be 50% better than TV, 12% better than display and 10% better than online video. Additionally, the ROI for CTV was between 10 and 50% higher than Linear TV.
Evolution Road clients have also seen CTV reaching a qualified audience more efficiently than Linear TV, leading to similar or better business impact and ROI. The targets were more likely to be diagnosed and cost almost $2 less than the “Traditional DDLTV” segment.
Embracing CTV as Part of the Digital Strategy: How to Prepare Now
Pharma marketers should evaluate how CTV fits within their overall marketing investments.
Here’s how you can approach CTV:
- Aligned Digital Objectives: Ensure that your digital strategies and objectives are clearly defined, to determine what role CTV should play in the overall marketing mix
- Clearly Defined Channel Plan: Have a clear definition as to the role each channel plays in achieving your digital goals. The role that CTV plays could be different than what linear TV or other video tactics have played in the past.
- Evaluate Opportunities: Determine how to leverage advanced targeting within CTV.
- Test & Learn: Construct a measurement plan that ensures you are capturing the data required to test, learn and optimize.
1Deep Intent study, Going Beyond Linear. March 2022.