Taylor Swift first showed up to support her boyfriend Travis Kelce’s team in late September. Together, Taylor and Travis have affectionately been dubbed “Traylor” by fans.

NFL Sunday Games Ad Spend Exceeds $1.5 Billion This Season

Even before the Swift mania, NFL Sunday games were advertising gold for networks and brands. MediaRadar’s data revealed that nearly $1.5 billion was invested by advertisers making appearances during Sunday NFL Football TV programming since the session kicked off in September with CBS, Fox, NBC, and NFL Network. 

The high price of NFL advertising is driven by the huge live audiences that advertisers can’t find elsewhere. NBC’s Sunday Night Football averages over 23 million viewers, making it the most watched primetime show. A 30-second spot costs around $800k, but can top $1 million for big matchups.

At Taylor’s first appearance during the September 24th Chiefs’ matchup against the Bears, over 140 companies invested in ads. Some top brands showcased included Apple’s iPhone, GEICO Insurance, and Ford. The combined spend from these three was over $20mm, 12% of the ad investment during the game. 

How Taylor Swift Impacts NFL Viewership and Brand Interest

While the NFL dominates live TV audiences, one area of growth is female viewership. Women now make up roughly 45% of the NFL’s fanbase. Swift’s high-profile fandom provides further confirmation that football is no longer just for male viewers.

For brands, especially those targeting women, having an icon like Swift enthusiastically watching games makes NFL advertising opportunities more appealing. Ad creative and messaging can be tailored based on her presence and the boost in female viewers she brings. Brands also have an opportunity to snag scatter market ads to capitalize on the expanded audience when Taylor is seen in the stands.

Auto Brands Bet Big on NFL Games and Female Viewers

The largest ad spend thus far during Taylor attended Chiefs games came from automotive. Over $107 million was invested by auto brands, with SUV models making up 36% of that figure.

Hyundai, Toyota, and Ford were particularly aggressive, spending over $15 million during the three Taylor games alone to promote SUV models like the Tucson and Kona. The brand debuted a new ad campaign focused on female empowerment earlier this year, indicating it sees NFL games as a way to reach women buyers.

Nissan and Chevrolet also placed big bets on NFL broadcasts featuring Swift, advertising smaller SUV models including the Rogue and Trax. 

Insurance and Tech Also Make Huge NFL Ad Buys

Aside from automotive, two other ad categories filled NFL commercial breaks during Swift’s attendance – insurance and technology.

Insurance advertising was driven by leading brands like GEICO, State Farm, and Progressive. These three insurers combined spent almost $36 million on the Chiefs’ games, seeking to reach younger audiences during NFL broadcasts. 

Meanwhile, tech companies like Apple, Google, Verizon, and T-Mobile spent over $41 million on NFL in-game ads. Aside from promoting the new iPhone and Google Pixel, many of the tech ads focused on 5G connectivity and speed. This suggests the brands see NFL games as a prime opportunity to align tech performance with sports performance.

Biggest Spenders Bet on NFL Audience Scale and Growth

For leading NFL advertisers in categories like automotive and technology, the huge viewership delivers unmatched reach and scale. Investing millions on in-game ads allows them to connect brands to passionate fans and widespread audiences.

Taylor Swift’s newfound fandom provides further confirmation that the NFL audience continues to expand. Her presence encourages brands to refine strategy and creativity to ensure messaging resonates with female viewers that Swift helps attract.

With Super Bowl LVIII coming in February 2024, the Taylor impact will likely influence brands to develop ads that appeal to both male and female viewers. The expanding diversity of football audiences creates opportunities for marketers in 2023 and beyond.

In Q1, CPG advertisers from names like Pepsi, Procter & Gamble (P&G), and Mondelēz International spent more than $1.5b on TV, up by 12% YoY.

The message is clear: TV ads are still a big part of CPG advertising strategies. Unsurprisingly, CPG advertisers’ love for motion pictures extends to YouTube. 

During Q1, advertisers for more than 470 CPG companies spent over $650mm on YouTube, up by nearly 2x from Q1 2022. Where did those ad dollars go in YouTube’s orbit, and will they continue to flow from CPG advertisers?  

We looked at our data to find out. 

Diverse Audiences Attract a Variety of CPG Advertisers 

It’s easy to see why CPG advertisers flock to YouTube—they can reach 40% of global Internet users with ads proven to drive purchases. According to Think with Google, 63% of people say they bought something they saw on YouTube.

Much of that effectiveness stems from advertisers’ ability to target niche audiences consuming content on unique programming categories, which no CPG advertiser can take for granted as third-party cookies fade.

In Q1, more than half of the YouTube investment from CPG advertisers ($366mm or 56%) went to ads on channels in five categories: Music, Society & Culture, Gaming, Beauty, and Entertainment & Movies. 

Much of that investment (almost $140mm) went to Music channels, increasing by 81% YoY. At the same time, spending on Society & Culture channels jumped by 100% YoY to more than $83mm thanks to big investments from Lindt Lindor, Old Spice, and Cascade Platinum, whose combined investment surpassed $13mm. 

The link between YouTube, music, society, and culture is well established, making these channels a no-brainer for CPG advertisers. But as YouTube spreads its wings to appeal to a more diverse audience and compete with the likes of Facebook and TikTok for consumer attention, it’s also opening its doors to a new community: Gaming.

YouTube’s presence among gamers skyrocketed during the pandemic. In fact, people watched more than 100b hours of video on YouTube’s active gaming channels in 2020 alone—and CPG advertisers are taking notice.  

In Q1, advertisers, including those from Lindt Lindor, Oreo, and Ritz, spent $56mm to promote their products on Gaming channels, representing a 90% YoY increase. (Advertisers at Lindt Lindor, Oreo, and Ritz accounted for 16% or $9.2mm of the investment in Gaming channels from CPG advertisers). 

As YouTube continues to roll out the red carpet for the gaming community, expect CPG ad dollars to follow. 

Although YouTube has seen engagement among the gaming community drop post-lockdown, the video giant isn’t turning its attention away from a market worth billions. Actually, it’s likely just getting started under the leadership of Leo Olebe, who formerly held the title of Managing Director of Google Play’s Games Partnerships team.

Advertisers capitalize on YouTube’s evolution

CPG advertisers also made their presence known on channels related to Beauty and Entertainment & Movies.  

In Q1, spending from CPG advertisers on Beauty channels surpassed $48mm, up by 78% YoY as advertisers from e.l.f. Cosmetics O Face Satin Lipstick, M.A.C. Cosmetics Powder Kiss Lipstick, and Sol de Janeiro Body Care Collection combined to spend $9mm (19% of ad spend on these channels).

We expect that investment to increase in the coming quarters as Beauty advertisers tap influencers to strengthen their connection with consumers and YouTube enhances its commerce capabilities. 

For example, in 2022, the video platform announced a partnership with Shopify to launch integrated livestream shopping, allowing eligible YouTube creators to connect their Shopify stores to their profiles “so that viewers can complete their purchases without leaving YouTube.”

The move from YouTube follows successful pushes into livestream shopping from TikTok’s sister app, Douyin, Instagram, and Amazon. 

The investment in commerce and embrace of the creator community, which we know consumers trust, will undoubtedly keep Beauty channels at the heart of CPG advertising strategies moving forward. 

Meanwhile, the investment in Entertainment & Movie channels increased by more than 115% YoY to $19mm as advertisers for Cascade Platinum, Lindt Lindor, and Old Spice, among others, rode the wave of YouTube’s continued investment in primetime.  

In November 2022, YouTube launched Primetime Channels to “bring shows and movies from more than 30 services directly into the YouTube interface,” including Paramount+, Epix, and more niche offerings like The Great Courses and Magnolia Selects.

The launch made all the sense in the world to YouTube. According to Erin Teague, the leader of the Primetime Channels project, “You’ll [users] watch trailers on YouTube and leave YouTube to go start from scratch on the streaming service. So we were like, ‘What would happen if we just collapsed that experience and made it convenient to watch all this content in one place?”

YouTube is fundamentally changing the entertainment model but also creating a stickier experience for consumers, which will continue to catch CPG advertisers’ attention in the entertainment world. 

Hopping on the Bandwagon: New Advertisers and Brands Flock to YouTube

The lion’s share of YouTube ad spending from CPG advertisers comes from those firmly entrenched in the ecosystem. 

According to our data, of the 470 companies that bought YouTube ads in Q1, 81% did so in 2022, and more than 380 were responsible for 99% of the investment. 

But that doesn’t mean there aren’t rookies. 

In Q1, 11 “newcomers,” including Rubi Rose (Dapple Baby), Age Sciences (PMB beauty product lines), and Vitapod, invested more than $100k in YouTube. Overall, these newcomers spent $3.6mm. 

While these are relatively low spenders on the YouTube-ad-spending spectrum, established advertisers promoting new brands are also leveling up their YouTube strategy. Overall, advertisers spent almost $60mm to promote 275 new logos in Q1.

By now, another message should be abundantly clear: YouTube is a central cog in CPG advertising strategies that’ll remain in place as the platform makes itself a one-stop shop for consumers and advertisers to embrace its targeting prowess in a world without third-party cookies.

For more insights, sign up for MediaRadar’s blog here.

If you looked at any stats related to cord-cutting, the popularity of streaming, or the rise of OTT advertising, you’d think the answer was a resounding “no.” 

The waves of video consumption are shifting and flowing heavily in favor of online sources. The entrance of NBC and other traditional media giants into the streaming wars proves that this isn’t just a fad. 

Conventional wisdom would be that advertisers would shift their budgets from TV to digital. 

Not so fast. 

More than 5.5b people still watch TV, giving brands 5.5b reasons to keep TV ads alive. And that they did in Q1, collectively investing more than $14.8b in TV, with most of those dollars going to commercials of the 16-30-second variety. 

This article explains why advertisers are gravitating to shorter TV ads, which ones are going against the grain, and what the future holds for TV advertising.

Hint: The future may surprise you.  

Short Attention Spans Mean Shorter Ads

Commercials are a hot topic among consumers and advertisers alike. 

Advertisers have historically cherished their reach, especially during marquee events like the Super Bowl, the Olympics, and elections. 

On the other hand, the average consumer expresses the opposite sentiment, with two-thirds of respondents to a survey saying they don’t actively watch TV ads. 

Combine that with declining attention spans, and it shouldn’t be a surprise that advertisers aren’t fussing with long commercials; ads over 60 seconds accounted for just 4% of spending in Q1. 

According to our data, advertisers spent over $12.2b on TV ads of less than 30 seconds in Q1 2023, representing 82% of the total TV advertising investment. 

Of those ad dollars, $5b went to ads less than 15 seconds, while around $7b went toward those between 16 and 30 seconds. 

The gravitation toward shorter ads aligns with the attention spans of the digital consumer, but there are also data to support the allocation. 

While advertisers have historically defaulted to 30-second commercials, McKinsey found that the performance gains from longer ads (beyond 15 seconds) aren’t worth the extra dollars. The research also found that advertisers could potentially save up to 9% by shifting spend away from longer ads—a move that’ll be extra appealing in 2023 as advertisers look for efficiencies in their budgets. 

Shorter commercials are universally loved

When it works, it works. 

That’s what most advertisers said in Q1 about commercials that cut at the 30-second mark. 

In Q1, nearly 60% of the TV ad investment from media & entertainment advertisers went to ads between 16 and 30 seconds ($1.1b), while about a third went to 15-second commercials ($619mm). During Q1 2022, the mix was similar, with 61% of spending dedicated to 16-to 30-second ads and 31% to ads of less than 15 seconds. 

Meanwhile, the investment in 16- to 30-second TV ads from both finance and technology advertisers hovered around 66-67% ($1.1b and $766mm for finance and technology advertisers, respectively). At the same time, finance advertisers invested $432mm in 15-second ads, while technology advertisers spent $260mm.

For example, advertisers for The Progressive Corporation invested 83% of their budget on 16- to 30-second commercials, many of which landed on CBS, NBC, and Fox networks.

The message is clear: Short ads are in. 

Even advertisers with deep pockets who can stomach the lofty price tag that often comes with longer ads aren’t getting carried away. In Q1, advertisers for Procter and Gamble spent 100% of their TV ad investment on ads of less than 30 seconds. 

Pharma Advertisers Like What They Like

There’s always that one person in your family who goes against the grain. That’s pharma advertisers when it comes to TV advertising. 

While advertisers almost universally opted for shorter commercials in Q1, pharma and medical advertisers did the opposite, investing over half of their TV budget on ads between 46-60 seconds, up from 44% in Q1 2022. 

AbbVie, for example, spent 86% of its budget on 46- to 60-second ads, with the remaining 14% going to commercials of less than 45 seconds. 

Some pharma and medical advertisers took it further by investing millions ($217mm) in TV ads longer than a minute. 

The sizable investment in TV comes despite pharma’s slow-but-steady embrace of digital advertising as the industry continues its shift to digital healthcare. 

In 2022, advertisers for 572 pharma brands spent just under $1.5b on video ads, with 74 investing only in the format, including Millennium Pharmaceuticals, Merck & Co, Pfizer, Gilead Sciences, and Pfizer.

While pharma advertisers’ embrace of TV is far from surprising given the thin regulatory lines on which they sit, their investment in the traditional format may not look so outlandish in a few years. 

It’s 2023, and TV ads are making a comeback. 

The Comeback Few Saw Coming

TV ad spending was down by 2% YoY in Q1 2023, but it’s poised for a comeback few saw coming. 

Despite the adoption of digital and online video from a consumer and advertising standpoint, brands will have more reason than ever to keep TV ads moving forward. 

In fact, many advertisers are returning to traditional ad formats to break through digital ad loads, capitalize on consumers’ trust in traditional formats, and prepare for a world without third-party cookies. 

TV advertising may have faded out of focus for a few years, but it’s battling to regain the spotlight. As it does, advertisers across medical & pharmaceutical, media & entertainment, finance, retail, and technology, who combined to spend 54% of the TV ad investment in Q1, will continue to invest. 

For more insights, sign up for MediaRadar’s blog here. 

But even as digital formats root themselves in the budgets of brands, TV ads are still a significant piece of the pie. Here’s how much brands spent on TV ads in 2022 and how they’re performing so far in 2023.

TV Still Captivates Consumers and Advertisers

You don’t hear about TV ads nearly as much as their digital doppelgangers. For example, when Netflix introduced an ad-supported tier, the news made waves.

Shakeups to broadcast and cable TV players generally don’t make as much noise—outside of the Super Bowl when brands spend millions—but that doesn’t mean advertisers aren’t investing in the format. 

In 2022, 250k advertisers spent nearly $60b on TV ads, representing a 3% YoY increase from 2021.

True to form, pharma advertisers remained in the safe confines of TV, but other more digitally prone advertisers are investing as well, including those in the media & entertainment (up 15% to $7.6b), finance and real estate (down 5% to $6.6b), retail (down by 3% to $5.4b), and technology (down by 2% to $4.9b) industries.  

Overall, advertisers in these categories spent $39.4b (55% of the total investment) on TV ads last year. That said, only some of them increased their investment: pharma, financial institutions, and consumer electronics.

Pharma advertisers stay loyal 

After decades of showing little interest in digital, advertisers took notice in 2017 when their digital ad investment jumped by ~170% YoY to almost $6b. By 2024, that number’s expected to approach $20b. (For comparison, it’s estimated that retail advertisers will spend more than $66b this year.)

Pharma advertisers’ shift in strategy in search of digital-first healthcare professionals (HCPs) is long overdue, but it hasn’t fractured their relationship with broadcast and cable TV. 

Overall, pharma advertisers promoting over-the-counter (OTC) meds, medical devices, and companies spent more than $7.9b on TV in 2022, up 12% YoY.

Much of that investment came from advertisers promoting arthritis (up by 1% to $471mm), HIV/AIDS, and asthma (up 24% to $308mm) medications; advertisers in each of these categories spent more than $300mm on TV.

The biggest increase, however, came from advertisers for HIV/AIDS medications (up by 42% to $374mm). For example, advertisers for GSK increased their TV budget by 150% YoY to promote Cabenuva following the FDA’s approval last year.

In addition to GSK’s investment in TV, the company launched digital DTC marketing to patients. This cog in its advertising engine illustrates the merger between digital and traditional formats but also the rise of DTC and consumer marketing, two sectors of the advertising world that pharma advertisers have historically shied away from due to regulatory concerns. 

Spending was also likely a response to advancements by competing companies. In 2022, the FDA approved Sunlenca (Gilead Sciences), a new HIV drug for adults with limited treatment options.

The spending from GSK reveals the cut-throat nature of pharma and the need for advertisers to up their investments in all formats—TV included—when they bring new medications to the market. 

Finance advertisers balance generational differences  

Despite the rise of digital banking and finance—mobile banking will grow at a compound annual growth rate (CAGR) of 12.4% through 2026—many finance advertisers are still committed to TV.

In 2022, finance advertisers spent $3b on TV, a 7% YoY increase, driven primarily by those promoting banks, credit cards, and investment firms who accounted for 35% ($1.1b) of the category’s spend.

Advertisers for banks, in particular, spent big—think Bank of America and Chime—increasing their budget by 41% YoY. Meanwhile, advertisers for credit cards and investment firms boosted their investments in TV by X% and X%, respectively.

For finance advertisers, the commitment to TV during the digital shift is likely due to their desire to stay in front of pockets of society who haven’t fully embraced digital means of managing their finances. In fact, Baby Boomers have historically been the generation least interested in digital banking. 

The pandemic changed that. 

While younger generations have propelled the digital-finance revolution, older generations are warming up to it; 78% of adults in the U.S. now prefer to bank via a mobile app or website. 

Finance advertisers set on reaching both sides of the generational coin must shift spending away from TV and into ecosystems where consumers of all ages are spending their time, such as social media and OTT. 

Tech titans invest in TV 

Overall, technology advertisers decreased their TV budgets in 2022. That said, advertisers promoting consumer electronics did the opposite, increasing theirs by 21% to $1.8b.

Most of the increase from consumer electronics advertisers came from major players, including Apple, Alphabet, and Samsung, who aggressively pushed their cell phones in the perpetual competitive battle for smartphone supremacy. 

At the same time, Meta (Facebook’s parent company) upped its investment to promote its virtual reality headset, as did Oura to boost the presence of its Oura Ring. 

Qura also integrated its strategy into the NBA with a campaign starring basketball legend Chris Paul.

The surge in TV spending from some advertisers with deep pockets could suggest that the traditional format will only be accessible to those who can bear its immeasurable and often costly nature. 

It may also suggest those competing in competitive spaces, like cell phones, will have to use every channel available to woo consumers in their favor, even if it’s not “in vogue.”  

TV Ads Hang Around in 2023

Gone are the days when spending on TV ads soars year after year, but that doesn’t mean there will be a complete absence of commercials anytime soon, especially as advertisers seek an effective way to reach consumers without third-party cookies. 

Overall, advertisers decreased their investment in TV by 2% in Q1 2023, but they still spent almost $15b, thanks to pharma companies and quick service restaurants (QSR) increasing their budgets by 15% and 16% YoY, respectively. 

At the same time, advertisers for cell providers and auto brands boosted their budgets by 17% and 3%. 

While TV advertising no longer demands the prime time spot it once did, it’ll continue to secure a spot in budgets as brands and media companies blur the lines between traditional and digital advertising. 

As that happens, TV ads will assume a new role. 

Will it be a smaller one? Yes. 

Will it be any less valuable? A touch, but too many people still watch TV for their value to disappear.  

For more insights, sign up for MediaRadar’s blog here.

So much so that the average person spent over 5 hours a day watching videos in 2021 (across TV and digital).

Video ad spending is through the roof, but where are budgets going, and what does the allocation mean for the future?

Advertising Like It’s 1950

Many historians dub the 1950s the Golden Age of TV. One could argue that TV ads shined the brightest around that time, too, as “motion pictures” captured the attention of consumers and advertisers alike. 

It’s 2023, and TV is still popular, with Americans watching more than 2 hours of it a day. But the emergence of YouTube, connected TV (CTVs), and social media have turned the spotlight. 

Certainly, ad dollars have followed, right? 

Yes, but less than you’d think.  

In 2022, advertisers for more than 12.5K brands spent more than $59b on TV ads, representing a 3% YoY increase from 2021; the number of brands buying TV ads also increased by 3% YoY. 

Eight thousand of those brands increased TV spending by more than 20%, while advertisers for more than 30 brands surpassed the $100mm mark, including 4imprint Inc. ($175mm), BetterHelp ($349mm), FanDuel ($994mm), and St. Jude Children’s Research Hospital ($213mm).

For FanDuel and other gambling advertisers, the spending follows a historical MO centered around flashy, often costly, campaigns aimed at customer acquisition. But those strategies are souring. 

David VanEgmond, a former FanDuel and Barstool Sportsbook executive, said, “You’ve seen the industry pull back and say, ‘Wow, fighting for market share got pretty ugly in terms of losses.” 

He was talking about the lengths gambling advertisers went to catch the attention of the 1 in 5 people who bet on sports. Although those lengths were powerful, they often lacked measurement and attribution. 

As gambling advertisers shift their focus to efficiency and profitability, expect the advertisers from FanDuel, DraftKings, and BetMGM to move their dollars to digital video where they can measure performance and optimize in the best interest of their bottom line. 

While no one’s surprised by the TV-heavy strategy among gambling advertisers, the investment from direct-to-consumer (DTC) brands may turn heads. 

Digital-native DTC brands embrace traditional video ads

When most people think of DTC brands, they think of digital-native ones that built their business online. Brands like Allbirds, Harry’s, and Stitchfix are all examples of DTC brands that live and breathe the internet and, thus, digital advertising. 

Despite DTC’s digital association, many brands still embrace traditional ads. 

In 2022, more than 475 DTC brands spent over $5b on TV, representing a 5% YoY increase (the number of DTC brands investing in TV ads decreased by 9% YoY).

They’re not just dipping their toes into TV to diversify their media mix, either. Nearly 270 DTC brands increased TV spending by over 20% in 2022. 

As surprising as DTC brands’ investment in TV may seem, it follows the recent trend of brands embracing traditional ads to escape the digital clutter, take advantage of consumers’ trust in these formats and prepare for the final downfall of third-party cookies in 2024.

Still, DTC brands aren’t abandoning the digital highway that got them to the top.

Of those 270 DTC brands that increased spending by at least 20%, 93% spread their dollars across multiple formats, including Airbnb ($96mm), Booking.com ($77mm), Chime (bank brand) ($63mm), and Instacart ($118mm). 

Advertising Like It’s 2023

In 2021, digital video ad spending surpassed $55b and is expected to reach $80b this year, which would represent an increase of more than 140% from 2019. 

Video advertising is table stakes, but how are advertisers spending on formats across OTT, online video, and social media? 

OTT intimidation 

OTT advertising made up just 3% of ad budgets in 2020 despite accounting for 29% of the time people spent watching their favorite shows and movies. 

A couple of years later, OTT gained mainstream status. As of 2022, the average household had nearly 7 OTT streaming services. 

However, despite the preference for OTT, advertisers don’t seem ready to dive into OTT ads.

In 2022, advertisers for more than 7.3k brands, especially those in insurance, quick service restaurants (QSRs), and cell phones, invested $1.7b on OTT ads, with nearly 4.5k (61%) advertising in multiple formats. (Remember: Advertisers spent almost $60b on TV.) 

While advertisers appear uneasy about OTT, which could be due to the down economy and the need to invest in more measurable formats, ad dollars will come as younger generations abandon traditional TV, streaming services—now including Netflix—improve their ad tech, and advertisers flock to ecosystems that can help them thrive without third-party cookies. 

Online Video (OLV) 

If advertisers are keeping OTT at arm’s length, they’re making up for it with a firm grip on online video (OLV). 

In 2022, advertisers for almost 53k brands (up by 7% YoY) spent over $28b on OLV, with over 75% (~41k brands) increasing their budgets by at least 20%. 

A select group, including Aviron Interactive ($324mm), Harbor Freight Tools ($109mm), Ka’Chava ($175mm), and Purdue University Global ($111mm), each spent more than $100mm. 

For big and small advertisers alike, OLV is a safe bet, providing them with an engaging and measurable way to reach a massive addressable audience across popular platforms like YouTube. 

While these video hotspots have long served as a haven for advertisers, their popularity often ignites rising ad loads—and prices. If these hotspots become too crowded and expensive, forward-thinking advertisers may exit right to more affordable (but less proven) ones, like OTT and CTV.   

Social Media

Last year, advertisers for 37k brands spent $6.7b on video ads across social media, but are they falling out of favor? 

Maybe. 

Only a fraction of brands (~5k) increased their spending on video ads by more than 20%—and those were brands with deep pockets, like AMC+, Masterclass, and Spotify. Nevertheless, spending from these brands reached nearly $5b, or 72% of overall spending on social media video ads. 

The apparent aversion to social video—at least compared to video ads elsewhere—is likely due to the rising ad loads and negative sentiment. Social media ads are also losing some of their steam in the wake of Apple’s App Tracking Transparency, which allows iPhone users to ask apps not to track them across other websites and apps. 

According to analysis, Apple’s firm stance on privacy was expected to cost Facebook more than $12b in 2022 due largely to its ads’ diminishing impact. Other social platforms are feeling the brunt as well.   

What We Learned at NewFronts 2022

The battle for video advertising supremacy (and dollars) is full steam ahead, and it’s far from reaching its main event. The degree of diversification between digital and traditional formats that still exists makes that abundantly clear.   

But there’s a battle within the battle that’s arguably more captivating. We’re talking about the battle for digital video advertising supremacy, which took center stage at IAB’s NewFronts.

Here are some takeaways:

• Peacock introduced two new ad formats, including “scene ads,” which allow brands to insert themselves “directly into targeted content moments through natural visual effects.” Amazon released a similar format.
  
• In Twitter’s first NewFront since Elon Musk’s acquisition, the platform pushed Amplify (released in 2019) as a way for brands to run ads alongside audio and video content.
  
• Snap teamed up with Cameo and introduced Snap Promote, a solution aimed at content partners on Discover.
  
• Meta focused on its metaverse and highlighted how brands could connect with consumers on Reels. 

Whichever battle you watch, the fighting is over the same thing: Video ad dollars—and both digital and traditional players will stop at nothing to get them. 

For more insights, sign up for MediaRadar’s blog here.

Even more telling of the NFL’s golden status: Sports accounted for 94 of the 100 most-watched telecasts in 2022; the NFL accounted for 82 of those.

Shocker: The NFL’s audience is attractive to brands across industry lines.

In 2017, we started a series examining advertising across professional sports leagues, including the MLB, NBA, and NHL.

Our latest installment dives into the NFL and how its advertising has shifted.

More Opportunities

Some advertisers have historically been kept at arm’s length from the NFL.

For example, advertisers promoting whiskey, vodka, rum and other spirits got the red tape until 2018.

While some liquor brands partnered with individual NFL teams and have advertised in other major professional sports leagues before, this was still a major milestone—and a wakeup call to beer brands that have historically walked on the unencumbered ground.

The beer industry may oppose this change; however, networks and leagues, even popular ones like the NFL, need more revenue opportunities. The NFL can no longer turn away those like liquor brands that feed it ad dollars.

On a similar note, beer advertisers not named Anheuser-Busch (AB InBev) got their first taste of Super Bowl advertising in 2022 as AB InBev’s exclusive rights to beer advertising during the Big Game ended.

Finally, gambling advertisers have grown fond of the NFL, especially of late given the pandemic-induced boom in sportsbook apps; casinos and mobile gaming apps recorded a record $54.93b in revenue during the first 11 months of 2022.

The NFL is fully aware of the gambling boom, signing deals with DraftKings, FanDuel, and Caesars Entertainment that could be worth roughly $1b in revenue for the league in the next five years.

NFL Sponsorships Grow

The average NFL crowd increased by 3.25% per game in 2022, the second-largest figure in almost two decades.

Brands are taking notice, evident by the fact that NFL sponsorship revenue increased by 4% in 2022 to $1.88b. For comparison, that’s 15% more revenue than the NBA generates from sponsorships.

Jessica Gelman, CEO of KAGR, a key data analysis vendor to the league, said, “What has impressed me is how the NFL is reaching down [for younger fans] while maintaining the older fan base, and it’s been successful doing that.”

The NFL’s widespread appeal has attracted brands like Gatorade, Visa, and Verizon. The sponsorships didn’t come without some shakeups, though.

Most notably, Pizza Hut lost its status as the NFL’s official sponsor to Little Caesars.

Super Bowl LVII Advertising Recap

The 113mm people who tuned in for Super Bowl LVII were once again greeted by ads from household names like Mars, Rémy Martin, and RAM (despite a 30-second TV spot costing up to $7mm).

Here are some key takeaways:

• Advertisers from five categories were responsible for 75% of the ads: media & entertainment, technology, food, alcohol, and automotive. Media and entertainment advertisers dominated the night with 23 commercials from 13 companies.
• The number of automotive advertisers, including Toyota, BMW, and RAM, dropped to six. Inflation was the primary deterring factor for these advertisers.
• There were 3.5 minutes of beer ads, with whiskey and cognac each getting 60 seconds of screen time. Despite AB InBev relinquishing its exclusive rights to alcohol advertising, the company still accounted for 5% of the run time.

While Super Bowl ads came with a steep price tag, the return is there for advertisers willing to dig deep into their wallets. According to Kantar, Super Bowl ads in 2022 drove an average ROI of $4.60 per dollar spent.

Thursday Night Football Attracts Big Brands

Amazon’s Thursday Night Football package kicked off in 2022 after the company purchased the exclusive rights to stream the games outside local broadcast networks for $1 billion annually.

The investment seems to have initially paid off for Amazon, with the company seeing record signups for the first broadcast.

“By every measure, Thursday Night Football on Prime Video was a resounding success,” said Jay Marine, global head of Amazon’s sports division.

But is there a return for advertisers?

Maybe not. Thursday Night Football audiences missed estimates by up to 25%, forcing Amazon to compensate advertisers.

Despite the growing pains, it’s impossible to deny the unique opportunity afforded to advertisers.

For example, DraftKings ran TV-style commercials during the game and is the title sponsor of the pre-game show.

According to DraftKings CMO Stephanie Sherman, the real differentiator comes with the second-screen viewing experience.

The on-air talent can take out their phones and direct viewers to specific bets or combinations of bets in the DraftKings app.

Sherman continued, “We’re really excited about all the different ways in which activating this partnership provides ample opportunity for us to leverage different metrics and methodologies.”

The NFL Offers a Prime Opportunity for Advertisers 

Although the league has shown it can still draw large TV audiences, it’s aware of the cord-cutting trend.

The league is working to combat this via its own channels or through various partners, such as Amazon Prime.

The NFL also has more sponsorships and is opening the door for advertisers it’s historically kept out.

At the same time, the NFL offers brands increasingly appealing ways to get in front of an incredibly engaged and niche audience. Despite the price tag often tied to these ads, brands will continue investing in America’s most popular sport.

For more insights, sign up for MediaRadar’s blog here.

After taking a controlling stake a few years ago, Disney is expected to buy the rest of Hulu.

In 2022, WarnerMedia (which owns HBO Max) merged with Discovery (which owns Discovery+), creating Warner Bros. Discovery. Then, there were talks about HBO Max and Discovery+ joining forces as a single platform.

The list goes on.

Most mergers and acquisitions focus on how the content lineup will change, what these freshly ramped-up media companies can offer consumers, and which player will likely take the biggest piece of the pie.

But the real driving force behind the streaming wars is the ability of media and tech companies to reach audiences. It’s proving to be a winning combination.

Tech companies entered the media world (here’s to you, Amazon), and media companies are entering the tech — or, at least, streaming — world (we see you, NBCU).

With advertising as the driving force, the streaming wars have had another welcome effect for both ad sales and creatives: Changing how advertisers can reach their audience.

For Hulu, that initially meant offering ways to appeal to viewers finally catching up on a recent episode. In the case of NBCU, it’s a mashup of Out-of-Home (OOH) and digital advertising strategies.

As mergers and acquisitions shake up the industry and competition intensifies, every player in the space will have to innovate to woo advertisers in their favor; their ad revenue depends on it.

Hulu Embraces the Binge

As a streaming native, Hulu has much less disruptive advertising than its traditional broadcasting counterparts. But as the Disney-controlled streaming giant tops 48 million US subscribers, it intends to cut down its advertising load even further.

According to a report from AdAge, Hulu planned for 50 percent of its ad revenue to come from non-intrusive formats by 2021.

Hulu announced a brand new binge-watch ad format to kick off those efforts.

“We’re trying to recognize that the viewer experience in on-demand viewing is different from traditional TV, and we should and must evolve the ad experience,” Peter Naylor, Hulu’s SVP of Ad Sales Peter, told AdWeek in an interview.

Advertisers can take two approaches with this offering.

They can offer a longer ad to watch the third or fourth episode in a completely ad-free binge. Or they can hit a binging viewer with a relevant creative — like offering food delivery.  

The streaming service dubbed this new ad format ‘television’s first binge advertising experience.’

Binge ads undoubtedly excited advertisers — as did the rest of its presentation at NewsFront. That said, Hulu made it known that it wasn’t trying to recreate that magic.

Not because Hulu was going away but because Hulu would no longer get its own slot at NewsFront.

Instead, Disney said it’d “include discussions around Hulu advertising in talks around the rest of its media properties.”

Hulu has also introduced a new ad format called GatewayGo. The ad format marries traditional TV ads with prompts designed to increase the connection between viewers and brands — think QR codes and push notifications.

At the same time, Hulu integrated with Nielsen Media Impact to bolster its measurement capabilities.

“Streaming is leading one of the most profound consumer behavior shifts in history. For advertisers, streaming TV is no longer a ‘nice-to-have’ or ‘a place to test and learn.’ It’s a must-have, and it will redefine advertising in the same way that search did twenty years ago,” said Hulu president Kelly Campbell.

NBCU Bridges Traditional TV With Digital Advertising

As it keeps focusing on digital streaming and advertising, NBCU has announced its intention to cut its ad load by 20 percent by the end of 2019. Part of the plan was to include prime pod ads (60-second spots in the first or last break of each program) and more targeted ads in its offerings.

According to MediaRadar data, viewers see 4.6 ads per show and 8.7 ads per hour.

NBCU also introduced a Shoppable TV ad unit. The ad format “shows a QR code that viewers can scan with their mobile cameras,” writes Andrew Blustein at The Drum. “Viewers can then interact with and potentially buy from a given advertiser on their phones.”

The QR codes remain on screen for 30 seconds, meaning the shoppable ads will most likely be combined with NBCU’s previously announced prime pod ad formats.

NBCU’s head of marketing, Josh Feldman, made the broadcaster’s intention clear in a press statement: “By pairing brands with our premium content, storming the purchase funnel, and removing the barriers consumers traditionally encounter between seeing a product and making a purchase, we’re giving marketers a direct sales channel to millions of viewers across the country.”

For those dubious of the clunky foray into digital, Feldman had an answer: The first test of the shoppable format resulted in 50,000 QR scans in five minutes.

Netflix Enters the OTT Advertising Wars

After years of shunning ads, Netflix introduced an ad-supported tier in late 2022. The move from the OTT OG comes after a declining user base and intense competition from legacy (Hulu) and up-and-coming platforms (Disney+, Paramount+, etc.).

For Netflix, the move was a long time coming, and early indications show it was smart. The streaming giant ended 2022 with around 231mm paid subscribers, up 4% YoY.

It’ll take some work to get there, though.

According to an independent report, less than 10 percent of new signups in the month following launch were for the ad-support tier.

Still, Netflix has high expectations for its ad business. The company believes ads will eventually drive at least 10% of revenue.

Its first-party data could help it get there.

“[If] you think about the growing relevance of first-party data and how we do that, those are real big advantages that we can bring relative certainly to the traditional TV world,” said etflix’s new Co-CEO Greg Peters.

Growing pains aside, everyone else in the OTT world is feeling the pressure, which is good for advertisers. Over time, that pressure will drive advertising innovation.

The Upshot: TV Advertising is Evolving, Not Dying

Hulu’s NewFronts announcement is a streaming native expanding its offerings for media buyers, while the NBCU ad format is a traditional broadcaster getting up to speed with digital.

Both show how TV advertising is evolving in the midst of the streaming wars.

The NBCU experiment shows that ad tech is not a matter of digital advertising replacing TV ads — it’s a matter of TV advertising starting to incorporate digital formats and data. “Innovations are making TV advertising more compelling,” the CMO article concludes.

At the same time, the new binge-worthy ad format from Hulu shows that online advertising — even in over-the-top television — will only continue to get more targeted for customers and customizable for media buyers.

Now it’s just a matter of bringing the two together. Incorporating digital into TV advertising, like NBCU has done with its QR code, is a start. But TV advertisers will increasingly want ways to target more effectively while taking advantage of the emotional connection TV advertising offers. And media companies will have to be ready.

For more insights, sign up for MediaRadar’s blog here.

We began our series of “integrated advertising in sports” posts in 2017 by looking at how brands, including T-Mobile and Duracell, were capturing the attention of baseball fans during that year’s World Series. We also wrote about the NHL and how the league’s evolved from blank boards to virtual ad overlays.

Today, we’ll keep the ball rolling and dive into integrated advertising in the NBA—and how brands can reach a massive addressable audience.

Breaking Tradition

The MLB is perhaps the best example we’ve seen of a professional sports league leaving tradition in the past – interesting, as baseball is the game that seems to thrive on tradition more than any other.

The ads present in 2017’s World Series showed a true effort and diversion from what viewers were used to seeing.

The most “in-your-face” example came from YouTube, which brought an ad smack-dab in the middle of the action, right behind home plate. 

More recently, FTX sponsored logo patches on the uniforms of baseball’s umpires.

The NHL’s many innovations have been impressive but are more so extensions of things that already existed. The NHL has continued to push the boundaries of integrated advertising, sometimes at the behest of its viewers. Most recently by debuting digitally enhanced dasherboards.

The NBA is following suit and taking its own strides to incorporate ads into its product.

Despite being one of the most consistently fast-paced sports to watch, the NBA still has a lot of traditional downtime via advertising. Commissioner Adam Silver, however, has made notable strides during his tenure to better integrate ads into the viewer experience. 

The first was to restructure the game itself. The league introduced a new timeout structure, leaving teams with fewer timeouts, resulting in fewer commercial breaks for advertisers.

The second stride came as a way for NBA teams to still drive revenue, even with fewer commercial breaks – they added advertisements to team jerseys. The NBA took things further by approving two more ad spots on uniforms for the 2022 season. 

Jersey Patch Ads

The discussion surrounding jersey ads has lingered for a while now, and not just in the NBA.

We’ve seen jersey ads before, most notably in professional soccer leagues worldwide and the WNBA.

Jersey ads recently came to the NHL as well. Two of the most “traditional” franchises—the Toronto Maple Leafs and Montreal Canadians were quick to jump on the opportunity for additional revenue.

Soon enough, the NBA decided to break away from the pack and endorse the long-discussed jersey advertisement with a three-year test run.

The test run was successful, at least by the NBA’s standards. Since 2016, the available “inventory” has steadily grown, with the NBA recently announcing more inventory was becoming available—this time on shooting shirts and warmup jackets.

When the league first announced jersey patch ads, it was not to much delight from fans.

Upon seeing the ads, however, it became clear that there was much attention paid to integrating the brand logos into the color schemes of each team to make them less noticeable, even native to the surrounding branding.

Here are a few recent examples from the Golden State Warriors, Philadelphia 76ers, and Phoneix Suns:

Of course, the 76ers will have to move on from Crypto.com as the company in light of the industry’s collapse and the subsequent hard stop on advertising to promote digital currencies. 

Overall, however, these ads generally work well with team branding. More so, they provide another legitimate source of revenue for NBA teams.

While there are no set prices for this inventory, one of the most lucrative deals for any team has been the Golden State Warriors’ sponsorship agreement with Rakuten, a deal worth $60 million. Recently, the Golden State Warriors and Rakuten agreed to continue their partnership.

All-Stars and All-Sponsors

Typically, jersey ads and things of that nature are test-run in international and exhibition matches, regardless of the sport.

The most notable yearly exhibition in the NBA is its annual All-Star Game. The All-Star Game is a perfect example in looking at the NBA’s high-level inclusion of sponsorships during game broadcasts.

Here’s a list of some of the events that’ll take place during this year’s All-Star Weekend:

• Jordan Rising Stars Practice
• Ruffles NBA All-Star Celebrity Game
• NBA All-Star Practice Presented by AT&T
• Kia Skills Challenge

For Jordan, Ruffles, AT&T, and Kia, All-Star Weekend will be filled with fun and excitement—and their logos front and center.

While All-Stars and All-Sponsors have been done for some time now, it’s important when considering the NBA’s efforts to minimize commercial breaks.

In-Game Sponsorships

The deeper fact here is that sponsorships come in many forms in the NBA. Jersey ads are the most recent, and currently, the most talked about form of sponsorship, but there are a number of other in-game sponsorships.

There are a lot of working parts during any basketball game aside from the players, as well, including the many tools, technologies, and people that maintain the court’s functionality.

One of the most important technologies present during NBA and NCAA Basketball games is the shot clock. Tissot took advantage of this when it debuted a new integrated timing system and shot clock with innovative LED glass technology developed exclusively for the league.

It’s transparent, houses touch-screen controls, and displays a large Tissot logo for all to see. No other sport uses a Shot Clock as the NBA does. Therefore, no one else can utilize this ad space.

Old Spice also found a way to get an advertisement into the working functionality of basketball games. And even though this one has been taking place during college games, it was simply too much fun to leave out.

The War on the Floor

The NBA has put in a great effort to be the most progressive, tech-driven league. As we mentioned earlier, that’s largely due to their youthful audience. 

That effort is most evident in the experience they offer fans, ads or no ads. A good example of this is the NBA’s endorsement of virtual reality.

The NBA experience is free and available on Meta’s Horizon Venues platform, a free software download for the Oculus headset. People appear as digital avatars and watch games from a courtside perspective.

From a business perspective, the deal could give the NBA a new set of media rights, which is important as regional sports networks struggle.

Facebook is also partnering with the NBA to launch NBA-licensed apparel in the Meta Avatar Store where consumers can purchase NBA or WNBA apparel for their avatar.

In terms of ads, however, one of the most innovative things we’ve seen the NBA do is use arena floor space as a video ad landscape.

On February 10, 2018, the Golden State Warriors played the San Antonio Spurs in their home, Oracle Arena. At halftime, the fans were treated to what was called, “The War on the Floor,” where they used the court as a projector for a God of War video ad:

At first, the video plays on the Jumbotron, which is nothing out of the ordinary. Soon after, however, the entire court lights up with a snowy, icy, action-packed narrative.

This is extremely important for the broadcast’s sake. Even though these videos cannot be played during live-game action, they can be used to reach viewers streaming live games.

Streaming service NBA League Pass, for example, allows viewers to stay inside the arena during broadcasts. There are breaks, but simply no commercials. Viewers instead watch halftime shows, timeout breaks, t-shirt tosses, and so on.

Integrated Advertising in the NBA: A Primetime Opportunity for Brands

Overall, the NBA has done a fine job in living up to its tech-driven reputation, and with time, can prove to only become better. As the league looks to tap additional revenue streams, more ad inventory will undoubtedly follow. That said, the NBA will have to be careful not to infringe too much on the viewer experience.

Nevertheless, ad dollars will follow from brands looking to capitalize on the NBA’s niche and ever-expanding audience.

For more insights, sign up for MediaRadar’s blog here.

If you’re nodding your head, you’ve participated in the market’s direct-to-consumer (DTC) segment. 

Warby Parker, the unicorn among unicorns for digitally native brands, ushered in DTC nearly a decade ago. Established brands like Nike have been catching up ever since, putting the customer experience in the spotlight and playing with their online stores to make buying as easy as possible. 

The reverberations of shifting customer expectations continue to be felt among digital natives and major retail brands alike—and the model’s growth across industries and markets is stratospheric.

In 2022, approximately 64% of consumers worldwide made regular purchases directly from brands. The DTC model is here to stay, and ad platforms will need to learn to keep up. 

But how have DTC disruptors changed advertising, and what’s most important for advertising in the DTC model?

This article dives into how DTC advertising differs from traditional advertising and which factors remain the same.

What’s a DTC Brand and What Do They Mean for Traditional Advertising? 

A DTC brand is any company that sells its products to consumers rather than going through a distribution channel or retail store. With that definition, DTC can take on many different forms. 

Digitally native brands like Allbirds, Away, Casper, and Dollar Shave Club are examples of B2B brands in their purest form. 

By definition, Uber is also DTC since consumers can simply press a button and their ride shows up. No intermediaries are involved. 

Sometimes, it’s new efforts put forward by industry giants, like Nike or Asics, trying to keep up with the times. Since 2011, Nike has grown DTC sales from 16% of revenue to 35%.

Other traditional brick-and-mortar retailers are also trying to break into DTC. Under Armour has expressed a desire to grow substantially in the channel, while Adidas outlined plans for DTC sales to make up 50% of its revenue by 2025.

Overall, DTC sales by established brands (like Nike) in the U.S. are expected to exceed $160b by 2024. Meanwhile, sales from digitally native DTC brands (like Allbirds) are expected to be near $62b.

In any case, brands bypass traditional sales models, and many are rethinking otherwise staid marketing strategies.

Much of this shift is due to the customer expectations that DTC brands, in turn, exhibit. 

In the Amazon age, brands expect direct connection, fast communication and clear expectations. At the same time, marketing and sales have become more experiential than transactional. DTC brands want to reach consumers directly rather than through publishers, retailers or advertising agencies. 

The response from major advertising platforms has been telling. Instagram, Facebook, and other major social platforms have become popular among DTC brands for their ease of use and reach. 

That said, times are changing.

Since Apple began asking users whether they’d allow their online activity to be tracked, only a small percentage have agreed, making it difficult for DTC brands historically thrived within social’s walls. 

According to Polly Wong, president of Belardi Wong, an agency whose client base is ~90% DTC brands, return on ad spend (ROAS) for its brands on Meta platforms (Instagram and Facebook) was down by 23% year over year in January 2022.

For DTC brands that rely on advertising, this doesn’t bode well. In its recent IPO, Allbirds said it spent more than $55mm in marketing-related expenses in 2020. 

Meanwhile, the same year, Casper spent more than $156.8mm on advertising. Finally,  Wayfair spent nearly $1.5b. 

Other platforms are evolving as well. For example, NBC Universal has tried to reach DTC advertisers by pulling them into their online channels. 

“NBCU is offering DTC brands complete campaign consultation, from audience connections and content creation to cross-platform measurement and placement optimization,” writes Jeanine Poggi at AdAge. 

Brands will also have access to in-house data and creative teams. The move makes it clear that DTC brands are cut from a different cloth regarding advertising.

What’s Important for DTC Ad Sales?

Just like DTC brands are using new advertising strategies and platforms are evolving to meet them, ad sales to these brands will have to take on a new form. 

Sales are no longer just sales; it’s the customer journey. Support is no longer just support; it’s the customer experience. Or so go the main tenets of the DTC model. Ad sales reps will do well to play into the DTC hand.

According to research from the MediaRadar, you can expect to find some (or all) of the following attributes in DTC brands:

• Mission-driven. Many DTC brands believe in the value they are offering their customers. Their message is not about the product only; it’s often just as focused on connection or experience. For example, Allbirds’ mission is to prove that comfort, good design, and sustainability don’t have to be mutually exclusive. As more consumers prioritize missions in their purchase decision, these companies will come to the forefront. 
• Younger customer segments. Since most DTC brands are digital natives, they focus on Millennials & Gen Z customer segments. For example, a DTC brand is likelier to advertise via Instagram or TikTok than HGTV. Young consumers will continue to drive DTC brands in 2023 and beyond.
• Brand authenticity. Customers tend to be invested in a DTC brand, meaning emotional marketing works better than other models. Spending for a customer support program may not top ad spend for DTC brands, but it could come close. In fact, 90% of Americans use customer service as a factor in deciding whether or not to do business with a company.
• Quality over price. Many DTC brands take the conversation surrounding benefits vs. features marketing seriously – and product price rarely factors into their marketing strategies.
• Product specialization. In contrast to major retailers or apparel brands, DTC brands tend to specialize in a single product – or highly defined set of products. The Casper catalog – which started as a mattress and now includes just a handful of sleepytime accouterment – is a good example of this focus.
• eCommerce sales. Most DTC brands are digital natives, with sales available only online – from platforms like Amazon to their own self-hosted stores. The same goes for most marketing efforts, focusing on digital channels like social and paid search. The rise of OTT, especially among younger generations, will push ad dollars to these new ecosystems. 
• It’s all about the data. DTC brands tend to be highly analytical – they rely on metrics to appeal to their customers, make their sales, and follow up with great messaging. Most of their sales and marketing efforts are aimed at making tweaks to optimize the funnel rather than to make a big splash. That said, the downfall of third-party cookies will put them in a pickle. They’ll need to quickly find advertising alternatives to drive a return. 

These are the highlights, but they’re not the only elements that make a DTC brand unique for advertising opportunities. 

Check out our follow-up to this piece and our comprehensive guide for more specific tips on selling advertising to a DTC brand.

For more insights, sign up for MediaRadar’s blog here.

Meanwhile, the shares of broadcast television stood at just 22.4%.

As the global over-the-top (OTT) market continues to enter the living rooms of millions—OTT had a user penetration rate of approximately 42.9% in 2022—significant players like Netflix, Amazon, Apple, HBO Max, and Disney+ have built their media offerings. As a result, advertisers have had to figure programmatic TV out on the fly. 

But what, exactly, is programmatic TV advertising? 

Is it addressable? 

What are its benefits? 

The tech is in its early stages, so we’re naturally confused.

What Is Programmatic TV Advertising? 

Programmatic TV advertising is a technology-driven way to buy ads across the web, mobile devices, and connected TVs. Programmatic TV advertising extends to linear TV ads and OTT technology like Disney+, Netflix, and HBO Max. 

Programmatic Advertising for OTT: Opportunity vs. Capability

OTT distribution channels (or streaming platforms) may have a while before they completely take over traditional television. While user penetration is promising, rising prices could push people back to old-school cable. 

Entertainment analyst Paul Erickson says, “Services really see content as their weapon to ensure people subscribe — and they stay subscribed — in this dog-eat-dog environment.” He said the price increases will end when consumers “start leaving the service or stop subscribing.” 

Still, there’s enough meat on the bone to warrant a “What’s next for advertising?” type of conversation. Revenue in the OTT video segment is enough to warrant it on its own, which is expected to reach $316b in 2023.

So, why are advertisers flocking to OTT? 

Because linear and broadcast TV ads just don’t cut it anymore. 

In fact, 94% of TV ads reached just 55% of linear TV audiences in Q1 2022. While impressions rise at times—linear TV impressions were up by 19% in Q4 2021 in tandem with the football season—they’re worthless if no one sees the ads. 

Reach is a problem, but so is efficiency, which is why advertisers are eager to go programmatic. 

Despite the opportunity, there are several holdups to implementing addressable TV ads. 

To start, it’s a complex undertaking.

When you start mixing direct TV ads, popups on mobile video, banner ads on web platforms and more, figuring out pricing, opportunity and targeting can quickly get confusing. 

Cross-channel advertising has always been challenging; adding OTT to the equation makes it exponentially harder, given the siloed ecosystems in which these platforms live.  

Add to that the intricacy of the marketplace itself, and things may take a while to untangle. 

The Wall Street Journal reported that “Silicon Valley heavyweights” with a direct-to-consumer laser focus and “traditional media companies” looking to figuratively keep up with the Kardashians are competing in at least five distinct categories.

These companies are vying for consumer attention in increasingly complicated combinations, replete with subscription entertainment, TV streaming, ad-supported online video, cable/TV bundling, and sports.

The intricacies are hard to handle, and the platforms need help to meet the demand. 

Said another way, advertisers follow audiences from traditional TV to streaming, but when they get there, they find there aren’t enough ad slots to go around.

Netflix’s ad-supported under-delivery issue has been notable. 

According to an agency executive, “The past few weeks [following the ad-support tier’s launch], it has been okay.” 

According to the Digiday article, “the company [Netflix] could have avoided that initial situation altogether if it had had supplementary inventory to offer advertisers to make up for the viewership shortfalls immediately rather than needing to allow advertisers to take their money back in order to achieve their year-end reach goals.”

Disney is navigating that potential hiccup by unifying its ad tech stack behind Disney+ and Hulu to give it more flexibility in juggling advertiser demand.

For example, if Disney can’t deliver an ad on Disney+, it can move those ads to Hulu or ESPN+.
As one agency executive said, “What they are relying on is their ability, as a portfolio media company, to have their own safety net.” Other OTT platforms need to figure out a backup plan as well.

On the Horizon for Programmatic TV Advertising

The multiplex holds promise for both media platforms and media buyers.

For media platforms, programmatic TV allows for better integration across distribution channels, translating into a better experience for the consumer. 

For media buyers, the benefit is summarized by Google’s Rany Ng and Anish Kattukaran: It is data-driven and addressable. Media buyers can pinpoint ads based on not only demographics but keywords and potentially browsing history as well.

The opportunity for addressable TV advertising through OTT tech is hard to ignore. We see multiple media and telecommunication companies making moves toward the capability as a core part of their offerings.

In a time reserved for major broadcast and cable networks, data-driven TV advertising may become central to the conversation.

For more insights, sign up for MediaRadar’s blog here.