Sizing up the CTV opportunity in retail media

Connected TV (CTV) is now an integral part of retail media. Media networks can offer rich third-party data, while CTV platforms have advanced targeting capabilities and an engaged audience. But just how big is the opportunity?

• About 1 in 10 US digital ad dollars will go to CTV this year, a total of $33.35 billion, per our forecasts.
• Of that, 15.0% will come from retail media, up from 11.9% last year. And that figure will rise in years to come.

Retail media CTV ad spend is growing about three times faster than retail media search is.

• That said, CTV spend remains considerably smaller than search in retail media, at $4.99 billion compared to $39.64 billion, per our forecast.
• CTV is growing within retail media as more inventory becomes available via industry moves like Amazon Prime Video ads or Walmart’s acquisition of Vizio.

The growth is also confirmation of an ongoing trend: Retail media advertising has moved up the funnel, evolving past performance marketing into brand marketing with elite targeting capabilities.

CTV audiences rival retailer traffic.

• Almost 7 in 10 people in the US are CTV viewers, per our forecast.
• About the same amount of people are Prime subscribers, our forecast shows.

But CTV advertising has not caught up with the massive amount of time people are spending with streamers.

• Netflix, Disney+, Max, Tubi, and Paramount all have a time spent share that exceeds ad revenues.
• In order to boost revenues without inundating users with ads, streamers will continue to partner with retail media networks to improve ad targeting and attribution capabilities.

The trend toward CTV will be especially pronounced as retail media turns into commerce media.

• Retailers far outrank financial service, travel, and ride-sharing platforms in terms of traffic, according to Comscore.
• As these non-retail industries invest in ad networks, they’ll need partnerships with other industries like CTV to provide inventory that will actually reach consumers.

This was originally featured in the Retail Media Weekly newsletter. For more marketing insights, statistics, and trends, subscribe here.