What to Know About the Premium TV Ecosystem

Despite economic challenges, advertisers remain optimistic about the value of the TV ecosystem as a core driver of their marketing goals. More than nine out of 10 advertisers expect to maintain or increase spending in streaming and free ad-supported streaming TV (FAST) over the next 12 months, according to the second annual Comcast Advertising Report. Confidence in linear TV remains strong, as well, with 80 percent of advertisers planning to maintain or increase traditional TV spend, according to the study.

What does it take, though, for brand advertisers to maximize the value of their investment in TV and reach audiences across a fragmented landscape? The new report answers exactly that, drawing on data insights from FreeWheel, Comcast’s advertising technology platform, and Effectv, Comcast’s advertising sales division.

Understanding Trends in Buying Behavior

James Rooke, president of Comcast Advertising, says the report is unique because it examines the digitization of TV advertising through the perspectives of viewers, buyers, and sellers powered by a unique combination of data insights derived from Comcast’s different advertising assets. Trends in buying include using streaming advertising as a complement to — but not a replacement of — linear TV, since traditional TV remains the cornerstone of TV advertising.1 In addition, spend on FAST services (e.g., Xumo, Tubi, and Pluto TV) is increasing because marketers are embracing FAST as a tactic to reach people who may not have a cable subscription in a premium environment akin to traditional TV. Addressable advertising is on the rise, too. According to the report, nearly three-fourths of advertisers are including addressable TV in their media plans, a 15 percent increase since last year.1

In terms of how advertisers are buying inventory, direct deals represent the largest portion of transactions in premium environments (e.g., long-form, professionally produced content viewed on the big screen), with 68 percent of buying going through insertion orders, compared to 32 percent through automated, programmatic transactions, according to the FreeWheel Video Marketplace Report: 2H 2022. Advertisers do recognize the advantages of programmatic, though, as evidenced by the 12 percent increase in programmatic buying for TV and premium video advertising from 2021 to 2022, per the report.

“Done the right way, a more automated, biddable, and data-driven execution path enabled by programmatic provides greater optionality for advertisers transacting on premium video, while still ensuring the right controls and protections are in place,” Rooke says.

Despite the double-digit increase in programmatic advertising in the premium ecosystem, Rooke notes there is a lot of work ahead to address challenges in the space.

“While we expect a continued shift of impression volume to programmatic channels over the next few years, the industry has work to do in order to reduce programmatic supply chain complexity and increase transparency,” Rooke says. “More directly connecting root inventory owners with marketers will help reduce complexity and increase working media, while transparency requirements that apply equally across all inventory sources — including walled gardens — will better inform media allocations toward the highest impact environments.”

To that point, Rooke notes sports programming likely is helping to drive programmatic’s growth, as it becomes increasingly common for sports programming to be offered in a streaming environment. In fact, the Comcast report found that there was a 38 percent increase in programmatically transacted impressions for live sports over the past year (2022–2023).

“While sports programming on traditional TV is mostly bought through direct buys, advertising in sports content in streaming allows for dynamic ad insertion and more programmatic buying paths, such as private marketplaces,” Rooke says.

How Advertisers Are Succeeding with Multiscreen TV Advertising

An analysis of multiscreen TV campaigns by Effectv revealed viewers were reached through more than 4,000 different endpoints, including traditional TV, streaming platforms, smart TV apps, and many others. There is no denying that a fragmented TV ecosystem creates challenges for brands. Rooke advises advertisers to ensure the fragmentation issue isn’t made worse by separating linear TV and streaming campaigns, but rather ensure campaigns are multiscreen by design to maximize audience reach regardless of viewing device.

“For example, we found that allocating 20 to 30 percent of a premium video budget toward streaming and the rest to traditional TV maximizes reach, as does advertising throughout the year rather than focusing all dollars into specific bursts throughout the year,” Rooke says.

Where step one is “Be seen,” the next step, Rooke explains, is “Be memorable,” meaning deliver a message that audiences will remember when they are ready to make a purchase. While quality of creative is of course the cornerstone of being memorable, the viewing environment and the quality of the ad experience also matter. “We found that viewers are 58 percent more likely to recall ads in professionally produced content than user-generated content, and ads on the TV screen drive 2.2 times higher unaided recall and [have a] 1.3 times higher purchase intent compared to a mobile digital in-stream environment.”

A Look Ahead: What to Expect from Premium TV Advertising

Brand advertisers can expect TV to continue its evolution as the worlds of traditional TV and streaming converge, enabled by innovation in ad technology, measurement, privacy-compliant data insight sharing, and delivery moving to IP (internet protocol)-enabled infrastructures. And while linear will continue to look increasingly like digital, digital TV platforms will deliver an experience that is as powerful as the linear TV one.

Linear TV — which is still the foundation of most multiscreen campaigns — ultimately needs to be as nimble as digital, and digital needs to deliver as impactful an experience as linear. While this full convergence will ultimately happen so it's just all video, [it] will take time. What matters is how the industry can accelerate this convergence in order to simplify the buying experience and enable TV to fulfill its promise as a full-funnel medium that delivers superior results for advertisers.

James Rooke, President, Comcast Advertising

Cross-company collaboration is on the rise, too, as buyers, sellers, and technology companies work together to solve challenges facing the ecosystem and holding back accelerated convergence, such as measurement, alternative currencies, and complexity in the programmatic supply chain.

“As companies show willingness to partner and drive industry standards, we will see greater unification, scale, and ability to measure results than ever before,” Rooke says.

Adopting a holistic, data-driven approach to TV advertising is a safe bet for brand advertisers. That said, specific best practices will continue to evolve as the ecosystem changes.

“TV watching — and TV advertising — isn’t going anywhere, it’s just evolving for the better,” Rooke says.

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1. The 2023 Comcast Advertising Report, July, 2023.