How Connected TV is Changing the Monetization Landscape

By Satish Garikipati December 01, 2021

  • connected tv
  • CTV
  • CTV Advertising
  • CTV journey
  • monetization models
  • monetization technology
  • OTT businesses
  • SVOD
  • TVOD

For many years now, linear TV has been the only platform for media buying. While engaging, it came at a higher cost and was the only medium to reach the viewers directly and share stories with an engaged audience in short 30-second snippets.

Today, the rapidly changing landscape is being defined by Connected Television (CTV). By definition, CTV is a television device that streams video content over IP and is connected with over-the-top (OTT) services like Hulu, Netflix, Amazon Prime, YouTube TV, and Disney+ that can be streamed from anywhere and on any device.

The reach and frequency of CTV advertising are vast when compared to that of linear and traditional TV. CTV services appeal to the growing movement of cord-cutters since the content is available and easily accessible via subscription-based streaming services.

The Difference by Definition - CTV vs. OTT vs. Linear TV

  • CTV is connected to or through the internet. CTV and connected TV is any streaming device used to stream video over the internet.
  • OTT is the online TV/video content platform published through streaming or video-on-demand (VOD) models and “over the top of” traditional or linear network providers.
  • Linear TV is a classic or traditional service where a customer views a scheduled TV program when it airs on its original TV channel with any internet. 

According to the Leichtman Research Group, a recent study shows 39% of all adults watch video daily via a connected TV device, and over 80% of TV households have at least one connected TV device.

CTV and OTT have often been used as a one-size-fits-all strategy for advertising. However, recognizing the similarities and differences when strategizing a proper omnichannel advertising strategy is paramount. CTV relies on applications that stream live/on-demand video content through an internet connection (i.e., Apple TV, Roku, Chromecast, and Amazon Fire TV). It is important to note that CTV is connected with over-the-top (OTT) content streaming services, such as Hulu and Netflix, which only work when connected to the internet.

What are the Benefits of CTV Advertising?

  • Better outreach - through CTV, advertisers can reach TV viewers who can not be reached through traditional TV commercials.
  • High levels of targeting capabilities - advertisers can rest assured knowing that their money is being spent on their targeted audience due to specialized advertising that depends on demographics.
  • Measurable results - platforms let you measure your campaigns' results with digital and traditional metrics.
  • Target the cord-cutters - CTV advertising allows organizations to pin down the millennials and the ever-growing numbers of those who do not have or use cable TV anymore. This group of users is known as the cord-cutters.

Two main ways to monetize CTV channels – subscription fees (SVOD) and advertising (AVOD) – Download Evergent's CTV Monetize Guide to learn more about CTV strategy.

  • The SVOD model allows publishers to receive a higher ROI per viewer. However, this strategy requires a loyal viewer base, to begin with. This is due to a monthly or annual subscription that requires a dedicated user to be locked into a service. Due to the availability of free video content, the channel must provide exclusive content to convince viewers to pay to watch it.
  • The AVOD model can be placed strategically pre-roll, mid-roll, or post-roll. The advertisement may appear in banner images, sponsorships, and informational commercials.
  • As off-late, TVOD is an emerging method of monetization. A transactional-based model that generates revenue from occasional viewers, reducing the dependency on regular subscribers.

With the recent changes in the technological landscape combined with the advantages of CTV advertising, it is evident that the industry is evolving and expanding at a rapid pace. The increase in CTV viewership is opening up new opportunities for advertisers to maximize the ROI and touch target audiences in an impactful way through CTV's programmatic approach.

Want to Kick start your CTV journey? Speak to a CTV Expert.

About Evergent

Evergent brings Agility to Monetization and helps enable the CTV, OTT providers, and other SaaS-based e-Commerce businesses to acquire and retain new and existing customers by making the payments flawless, reliable, and highly secured. Evergent's market-leading Integrated Revenue and Customer Management platform helps the world's leading communication, media, and entertainment companies reduce time to market for products and services, simplify complex monetization models, and run back-office processes more efficiently. The company is headquartered in Sunnyvale, California, and has offices in San Diego and Los Angeles and internationally in Australia, Canada, India, Japan, and Singapore.