During the current pandemic, American adults are streaming more video content than ever before, raising new media mix issues for advertisers and agencies.

Nielsen data shows American adults streamed almost 142 billion hours of content during the week of May 11 – up 43% from a year ago – and much of that was on subscription services.

“Aggregate Netflix, Disney Plus and subscription Hulu, and it becomes really hard to reach [streaming] consumers with advertising,” Neil Vendetti, president of investment at Zenith, told AdExchanger.

Despite its rapid growth, then, connected TV (CTV) is not about to replace linear TV in the thinking of brands and agencies, except possibly when they’re trying to reach a younger demographic – “linear TV has basically abandoned that target”, according to Jason Kanefsky, chief investment officer at Havas Media.

Instead, they are more likely to use CTV to build incremental reach above that achieved on linear TV but there are cost factors to consider. “On CTV, my guaranteed CPM is at least double the price [of cable], unless you’re reaching a very young audience,” Kanefsky reported.

That might be acceptable in some cases – for brands seeking a direct response outcome, for example – but he cited the example of one client who was targeting 18-49 year-olds and added 2% incremental reach by layering on media from Roku.

“That’s nice, but it wasn’t this jaw dropping number,” Kanefsky said. “The cost of the incremental reach on these devices is significantly higher than on linear.”

That said, with more and more consumers cutting the cord, brands will inevitably increase CTV buys, although they will need to develop their understanding of how and when these should be added to the mix, based on their target audiences and campaign objectives.

“We’re trying to diversify our spend in alignment with consumption evolution,” Vendetti acknowledged.

Sourced from AdExchanger