Connected, addressable, smart – these terms, combined with the abbreviation TV, all belong to the world of Advanced TV. This in turn describes nothing other than TV – the medium, not the abbreviation – connected to the Internet. In the following lines, you will learn what exactly Advanced TV means, why it is so interesting for the Advertising industry, and what the challenges are.

Think about your consumption habits with moving image content. Like many others, you may also use a streaming platform such as Netflix, Disney+, Rakuten, and others. These platforms have become an indispensable part of our everyday lives. This is demonstrated by Goldbach’s DACH study on the use and distribution of Connected TV, which has been conducted for the sixth time.

Connected TV enjoys great popularity

Of 3,500 people surveyed in Switzerland, Germany and Austria, 79% stated that they were familiar with Connected TV (CTV) (Figure 1). 61% also use its additional functions, such as the streaming platforms mentioned above. According to the study, an average of 2.2 people per household use these offers (Figure 2) for 2 hours 21 minutes per day.

Figure 1: Awareness and overall use of additional CTV functions

Figure 2: Average number of people in front of the TV

In general, Advanced TV seems to be standard in more and more households. 70% of all respondents stated that they own at least one Internet-enabled TV set (Figure 3).

Figure 3: High penetration of Internet-enabled TV devices

Another point from the study that is relevant to Advertising concerns Advertising perception and acceptance. Almost half of those surveyed (46%) stated that they had consciously noticed Advertising in the context of the additional functions (Figure 4). Exactly half said that they absolutely accept the Advertising in this usage situation of their Smart TV.

Figure 4: Advertising perception on Connected TV

The best of both worlds

However, it is not only the consistently high level of awareness that makes Advanced TV interesting for the Advertising industry. The combination of TV and Online, which combines the strengths of both channels, is also an important factor. On the one hand, we have TV, which, according to the IGEM-Digimonitor of 2022, is the most popular medium in Switzerland with 5.9 million viewers (91% of the population) and is known for quickly building Reach. On the other hand, Online, where Advertising messages can (so far) be precisely addressed to computers, laptops, tablets or cell phones and performance can be measured very precisely. This combination is giving rise to new products such as Connected TV Spots, which means that Online Advertising has also been played out on the big screen for several years.

Challenges in the Advanced TV market

In addition to the great potential for the Advertising industry, Advanced TV is also facing challenges. Goldbach is aware of this and is already in the process of finding suitable solutions (points 1 and 2). Other challenges, on the other hand, are more statements that are not (or no longer) true (points 3 and 4):

1. 83% of users switch to their cell phones when Advertising is on.
With streaming offers, the Advertising interruption is shorter than with classic Advertising blocks on TV. In addition, the mid-rolls are announced. This reduces the loss of attention and viewers are more likely to stay in front of the screen. If they do switch to their smartphone, they can also be reached there, as spots can be booked not only on one device, but on all available devices.
Source: Study “The New Life Of The Living Room” by RTL AdConnect & smartclip

2. Data-driven targeting cannot be used in CTV, as is possible with Online bookings, so the Advertising is not personalized.
In fact, cookies on a smart TV cannot be set and used in the same way as on mobile devices, for example. Nevertheless, users can be individually addressed and picked up in the right context thanks to environment, time or geo-targeting.

3. AVoD (Advertising Video on Demand) is not used as much.
As described above, many people use streaming platforms. Contrary to expectations, the offering is divided into almost 50% Advertising-free and Advertising-financed offerings. However, according to the Magnite study “CTV Is For Everyone,” a full 85% of CTV users watch Advertising-funded content. Also exciting: according to the Goldbach study, two-thirds of users of paid apps would accept Advertising if they received the content for free instead.
Source: Study “CTV Is For Everyone” by Magnite, 2021

4. Users are annoyed by Advertising
According to the study “The New Life Of The Living Room,” this is not the case with AVoD. 55% are not bothered by Advertising and have taken concrete actions after seeing an Advertising spot. CTV Advertising is also highly effective: According to Magnite, 65% are receptive to Advertising in streaming environments, especially if it is personalized and tailored to them.
Sources: Study “The New Life Of The Living Room” by RTL AdConnect & smartclip, Study “CTV Is For Everyone” by Magnite, 2021

It is therefore fair to say that Advanced TV offers enormous potential for the Advertising industry, despite the challenges mentioned. Finally, another example of Advertising that is made possible by the combination of TV and Online: In Advanced TV, advertisers can run both Video spots on AVoD platforms and Display Ads via linear CTV content. This is personalized and via the usual digital booking channels.