Retail media and connected TV (CTV) are like peanut butter and chocolate, Danielle DeLauro, executive vice president at the Video Advertising Bureau, said at Advertising Week New York last week. “Together, there’s nothing better.”
We also see retail media as key to the future of TV advertising.
- Retail media and CTV are two of the fastest-growing ad categories we track.
- US retail media ad spend will increase by 22.5% next year for a total of $55.31 billion, according to our forecast.
- US CTV ad spend will increase by 16.8% next year for a total of $29.29 billion, according to our forecast.
What retail media gets from CTV
Time: CTV allows retailers to reach consumers where they are already spending time, said Ami Lathia, director of off-platform ad products at Roundel.
People are spending an increasing amount of time with CTV, according to our forecast. Next year, people in the US will average over 2 hours watching CTV each day.
Engagement: The platform has proven to foster engagement, and attention is high, according to Lathia.
Targeting: CTV offers precise targeting and measurement in a way that linear does not, Lathia added. And retail media data can be used to advertise even more precisely.
That means less waste for advertisers. Demographic targeting can result in ads reaching people who are not potential buyers, like a diaper brand advertising to consumers ages 18 to 49, rather than to people who have purchased diapers or maternity clothes, or who have joined a baby shower registry, said Ellen Mulryan, senior director of retail media partnerships at The Trade Desk.
Shoppability: CTV ads are shoppable in a way that linear TV commercials are not, while being entertaining in a way that search ads are not. This helps achieve an important goal: “Everything should be shoppable all the time,” according to Amie Owen, US head of commerce at UM Worldwide.
Innovation: CTV allows for innovative and interactive creative, which performs better than standard, static content, said Dan Mouradian, vice president of global client solutions at Innovid. For example, product carousels lead to incremental time spent with ads, according to Mouradian.
Dynamicism: Measurement data from CTV campaigns can allow for changes of when and where ads are served and for retargeting by retailers while a campaign is in flight. “If I could have my wish, it would be to have measurement influence not the next campaign, but the next impression,” said Mouradian.
Looking forward: Platforms need to work with retailers on an improved buying strategy. “I’d love to see brands start to figure out how to incorporate retail data into their upfront buys for CTV,” said Mulryan.
