Why ‘Smart’ Advertisers Should Look to Smart TVs

/ Jul 25, 2014

More people in the US use Smart TVs than last year

By Troels Smit

Many marketers are starting to realize the potential of advertising via smart or connected televisions (those that are internet-enabled), but according to eMarketer, 60% of media buyers still don’t know how to purchase video ads for a smart TV or a TV connected to a streaming device like a Roku. Validated by the projection that in 2014 there will be 397 million connected-TV sets worldwide, and data that shows online video viewing via connected-TVs has quickly climbed from 2.3 hours per week in Q1 of 2013 to three hours in Q1 of 2014, brands are eager to capitalize and reach their target audience through this non-traditional channel. Most savvy marketers understand, though, that to deliver a highly personalized and unique ad experience amidst this rise in connected TV consumption, they will require technology — and smart technology at that.

But what are the real benefits? What should advertisers consider before taking the plunge? How can they properly arm themselves and prepare to take advantage of the rise of the smart TV?

From a format and content perspective, it’s hard to beat a smart TV ad. Think highly personalized, targeted, HD-quality ads with stereo sound, all delivered via a super-large screen. Research shows that television screens have doubled in size in the last 10 years and the average TV set is now 33-inches wide, with technology experts also predicting that one-third of screens will be “jumbo-sized” by the end of the decade.

The format also provides the opportunity for viewers to interact with the ad or brand, allowing advertisers to get creative with their content and providing more opportunities for engagement. Because the adoption of connected-TVs has not been as rapid as many industry analysts first anticipated, many of the households who currently have a broadband-enabled television are wealthier, highly educated consumers who aren’t afraid to buy — making them an ideal target for marketers. Additionally, advanced targeting capabilities, personalization, and the potential for engagement are key components in the value-add of connected-TV buys. In fact, majority of consumers have said they would engage or would consider engaging with a smart TV ad if it is advertising a product or brand they’re interested in.

Also, when comparing connected-TV video ads to more traditional formats, some common fears of marketers are alleviated, including the less desirable auto-play and below-the-fold inventory, as well as fraudulent traffic. Many in the online video advertising ecosystem are working towards creating the most “TV-like” experience, via desktop and connected devices, and smart TVs provide the perfect medium to accomplish this initiative.

Research has also found that connected-TV consumers prefer ad-supported content to paid, ad-free content, an ideal scenario for OTT content providers and advertisers. Furthermore, when taking a look at the connected-TV video ad space as it stands, it’s very uncrowded and in its infancy, with few advertisers fully leveraging this platform yet. I expect that as connected-TVs continue to infiltrate the market, we will see more advertisers looking to capitalize through video ads, with those embracing the medium in its early stages seeing great ROI and success with their campaigns.

Troels-Smit-LiveRailAs VP of demand sales, Troels Smit brings over 10 years of industry experience to LiveRail. Troels has extensive knowledge of advertising technology and data, specializing in serving the buy side and building high performing teams. Before joining LiveRail, Troels was regional vice president of sales at Legolas where he focused on agency sales. Prior to this Troels held the position of managing director at DG/MediaMind and worked in Europe as well as the US. Troels holds a M.Sc in Science from the Technical University of Denmark.
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  • What this writeup completely ignores is the fact that all-inclusive SmartTVs are not as user-friendly as they could be, and according to recent studies most SmartTV owners don’t even know their TV is, for lack of a better term, “Smart.”

    Nearly every TV people buy, these days, comes with SmartTV juice built right in. So, unlike Rokus or AppleTVs or Amazon Boxes, etc, these SmartTV owners are not buying the TV with the intent to watch OTT video. Rather, they’re buying a TV because they simply want a new TV. Also, a lot of these people don’t know the TVs are smart to begin with, and so the functionality doesn’t factor into the decision.

    Those people who do know their TVs are smart don’t tend to hook them up to their Wifi, either. So this small percentage of SmartTV owners (those that know their TV has smart capabilities) don’t bother hooking it up to the internet to begin with. Then an even smaller sliver of those people hook it up to Wifi and actually begin watching OTT content.

    This is not to say it would be “smart” to ignore SmartTVs, as it’s true that the numbers are really intriguing, but ultimately you can’t act as though the sheer number of SmartTVs in the wild naturally equate to it being a perfect platform for advertising. Advertising requires viewership, and platforms like Roku and AppleTV are attracting more eyeballs than most anything else.

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