By Chad Tempo
Director of Partnerships, Martin DSP
Connected TV (CTV) and audio streaming ads have become the new must-buys for marketers and among the fastest growing channels of advertising. We see budgets allocated to these placements more frequently than ever but measuring them is challenging. So, how do you effectively measure the impact of these placements?
In 2020, the market recognized approximately $9.6 billion in CTV ad spend. To add, a recently released report from the IAB in partnership with Standard Media Index (SMI) and Advertiser Perceptions projected a 120% increase in CTV budgets to close 2022, expecting spend to hit $21.2 billion. Whereas streaming audio ads are projected to reach $6.2 billion, a 29% increase over 2020.
In comparison to placements such as display, online video (OLV) or native, CTV and audio creatives don't offer trackable call to actions (CTA’s) or ‘click-to-actions’ that may directly correlated to return on ad spend (ROAS) or return on investment (ROI).
If marketing is the act of driving change, and advertising is the marketers’ opportunity to reach, interrupt, educate and engage with a consumer, with intent of making change, shouldn't we measure the impact of those efforts?
Over the past decade or more, the preponderance of measured KPIs and metrics have mostly been reach, frequency, view through rate, and audio completion rate. Optimizing towards more impressions at a lower CPM, while ensuring the ad was viewed or listened to from start to finish, when in actuality brings little to no truth in impact. Where purpose lies, is whether the ad impacted the consumer enough to drive intent, or, furthermore, attribution. In the case of CTV and audio, attribution may be measured by post-view website visit or the ultimate goal of post-view purchase attribution.
More often than not, an agency or brand marketer uses ostentatious presentations to get buy-in from decision makers earning larger budgets because of well presented accolades. Beautiful creatives, complex media plans, layered on audience segments and diversification in budget allocation strategy. But the looming question remains, “how do you measure the impact?” Fortunately, there is a clear, but as yet underutilized, answer.
The only way media buyers should be measuring and optimizing CTV and audio ads is with incrementality. Doing so brings proof of change and impact.
Incrementality (or sometimes called “lift,”) is the measurement technique that marketers use to prove, with statistical accuracy, whether the ad caused the desired outcome. We know that when a targeted, anonymous person (e.g., ID:xyz123) is served an impression whether or not it impacts their decision to visit a website or make a purchase online or offline. I'll provide a couple examples of incrementality in motion.
A leading grocery delivery service ran a campaign measuring both CPA and incrementality. Once they began optimizing towards incrementality, lift increased by 12.2%. In another instance, a B2B solutions provider saw a 66% lift in signups among listeners who heard their campaign. Proof is in the pudding.
Agencies, start educating your traders and planners on the extreme importance of understanding incrementality. Your clients are demanding it. Measure the lift of their campaigns across CTV and audio without excluding other placements. Brand and direct response marketers, be accountable for incrementality; doing so will improve your brand equity and lower-funnel metrics.
Measuring and optimizing to incrementality helps you win.