Is ad waste in connected TV making brands wary?
A study recently found that CTV ads are being counted even when TV is off. This is resulting in ad waste to the tune of $1 billion
Connected TV has enormous advertising potential, yet it has been a largely untapped market, at least in India. This is despite the fact that 9 out of 10 CTVs sold in India in the year 2022 were smart ones, as per mediasmart report, and 81% of CTV users admit that ads improve their purchase intent.
A report by GroupM and iSpot has come as a dampener. Their study reveals 8-10% of CTV ad impressions are being counted as delivered even when the TV is turned off. The overcount reportedly results in about $1 billion in CTV ad waste. Such massive ad waste in the segment has alarmed the advertisers. After all, connected TV ad revenue globally is set to rise 26.7% to $12 billion this year, GroupM has estimated.
These findings have the potential to deter advertisers from spending ad money on connected TV, media experts feel.
CTV devices in India currently stand at an estimated 20-25 million, which is more than 10% of the 210 million linear TV devices.
In terms of viewership, connected TV’s reach is far bigger than the number of devices as many linear TV owners also watch digital content using fire sticks and other devices.
However, connected TV gets a minuscule share in the overall AdEx of TV which is over Rs 30,000 crores, industry experts say.
Achyuth Chirravuri - Group Head - Carat Media Services, a dentsu group company, says, “There have been cases of ad fraud in the past due to a fragmented system and expensive CPMs. CTV also lacks a proper measurement system which is one of digital marketing’s biggest assets. Hence, running relatively expensive ad units on CTV without proper ad measurement has been an ongoing challenge.”
Bots and spoofs
Wherever there’s a new marketplace taking root, fraudsters try to trick and fool the system to make quick money. In digital advertising, those fraudsters often use sophisticated bots to carry out that theft. These bots live on consumer devices, visit websites, click on ads, fill out forms, take over accounts, and commit payment fraud.
Since the CTV ecosystem includes several stakeholders such as device manufacturers, ad platforms, server-side ad insertion services, and content stores making it further complicated.
Currently, fraudsters can employ various techniques through device impersonation without being detected. They are also able to bypass apps’ systems to commit ad frauds, with or without the knowledge of app owners, digital ad experts say.
Kumar Awanish, Chief Growth Officer, Cheil India, says, “Device impersonation or device spoofing – is one of the most common types of CTV fraud. The ads served aren’t shown on CTV devices or real people. Instead, it is delivered to “bots” that are never seen by anyone. Fraudsters can impersonate apps as well which is hard to detect.”
Awanish adds that the CTV marketplace has grown so quickly that streaming services and technology partners are trying to keep up with anti-fraud measures.
In the new high-definition world of content, ad measurement hasn’t come into full focus yet. With so many players in the mix and an ever-expanding pool of streaming services with their own operating systems it’s easy to see why a singular measurement body is not an easy feat, says Krishna Menon, Chief Operating Officer, QYOU Media India.
According to Menon, ad fraud is not a largely seen phenomenon that would push brands to opt-out of this medium. Although he insists that there have been unavoidable reasons such as technical faults, ineffective targeting, and underperforming campaign outcomes leading to ad wastage.
Sometimes it is also observed that in CTV devices or any apps for that matter which have their own power source, the device might still be on when the TV is turned off, so ads end up playing but are never seen on screen. Since viewability cannot be measured with conventional tracking methods on CTV, this does create an added challenge.
Other factors too
There are other reasons as well which make advertisers wary of the medium, says Chirravuri. “Although CTV has amassed a high-value audience in India, brands often don’t readily consider CTV as compared to OTT and YouTube as they still have a relatively smaller reach, are more expensive (higher CPMs) while having lower trackability and clicks due to the video playing on TV. This in turn affects the ROI for ads on CTV platforms.”
Currently, there is a high probability of duplication between CTV audiences and OTT+YouTube audiences with the latter having smart targeting options to reach the same high-value audience which makes it an easier decision, Chirravuri points out.
Dabhade insists that CTV has better ad measurement than traditional TV which reports on the basis of a panel. CTV on the other hand reports at an impressions level.
“In India, the attribution ecosystem that credits performance to an advertising medium is still hung up on the last-click model. This prevents marketers from seeing the true impact of upper-funnel metrics. CTV being an upper funnel channel suffers from the same lack of measurement. We recently conducted a brand lift survey to measure the positive impact of CTV ads on brand awareness, purchase intent & message association etc.,” Dabhade explains, adding that MiQ India has partnered with industry leaders like Samsung Ads, Google and all the prominent OTT players to buy all CTV ad buying directly from the source to ensure that there is no fraud and apply frequency capping and reach management to ensure maximum return on investment.
Work in progress
Advertisers can put in place several tools and applications to protect themselves while ensuring their exposure is minimal and their spend is directed where it’s intended.
“Third-party platforms like Comscore have started providing measurement on CTV which tracks exposure, viewership, lift studies and attribution studies. The evolution of ad units on CTV making them more clickable also helps improve trackability. Recent ad units have featured the “send to phone” option as a CTA on ads to make it a more integrated and trackable experience, says Chirravuri.
Prabhvir Sahmey, Senior Director-India and South East Asia, Samsung Ads, says that the company is focused on providing a premium experience for advertisers while ensuring brand safety.
“Our Tizen operating system ensures that apps that stream through our OS are shut down when the TV is turned off. If you then couple this with our proprietary ACR data then we can start to help reduce wastage by helping agencies manage the reach & frequency of their campaigns across CTV & Cable. This allows them to avoid overexposure, and to reach the viewers they're missing on cable,” says Sahmey.
He adds as we look to the next generation of audience measurement, large first-party data sets from Smart TVs will likely play a key role in not only measurement but planning & optimisation.
The Walt Disney, Fox, NBCUniversal, Paramount, Vizio and Warner Bros and Discovery have committed to working with agencies and advertisers on the new standard, which would be designed to ensure ads are counted only when delivered to screens that are turned on and have people in front of them, media reports say.
