Singapore – Global advertising expenditure on connected television (CTV) is expected to hit the $26b this year, and yet there are still no clear indications whether the industry will see a ‘hockey stick’ growth. This is according to the latest data from WARC.
CTV ad investment forecasts this year remain minor in the context of a $526.8b global pureplay internet ad market and the $115.2b Meta is expected to earn in ad revenue. Meanwhile, YouTube’s ad revenue in 2023 is still forecast to be 17.4% greater than the entire CTV ecosystem, with that gap narrowing to 13.2% next year.
However, CTV media owners are mostly competing for existing TV budgets rather than winning share of spend from digital channels like social, or accessing new budgets such as retail media (it only took retail media 10 years to grow tenfold, and in the same time the size of the CTV ad market only grew three-fold.
WARC notes that the CTV landscape is highly fragmented across tech vendors and content publishers. This poses issues, not least in the ability of brands to measure incremental reach.
For the company, scale is the first consideration. While linear TV can reach tens of millions with a single creative, CTV’s key selling point – i.e. its ability to help brands to target audiences and avoid wastage – risks contradicting that key attribute of mass scale.
Alex Brownsell, head of content at WARC Media, said, “CTV ad spend is growing, but not as fast as one might expect. Whilst eyeballs are rapidly shifting from broadcast to streaming, this is evolution, not revolution.
He added, “The market is fragmented, and CTV ad investment is mainly being drawn from existing budgets. More work must be done to help CTV to realise its full potential and ensure that media owners are able to attract ad dollars from beyond the current confines of the TV market.”
