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Marketing Strategy

Despite pressure to tighten budgets, marketers still invest in authenticated digital channels like CTV

A hand with a white linen glove balances a golden CTV with a gold chain progress bar and a gold play button inset in satin.

The media buying landscape can change quickly — transforming from one year to the next.

Case in point: In 2023, marketers were faced with economic uncertainty. But in 2024, the outlook for the global economy is brighter, according to the most recent Chief Economists Outlook, published by the World Economic Forum.

How should marketers respond to ever-changing macro trends?

Some have reacted by spending more of their ad dollars in digital channels — especially CTV and video — over the last year, according to several media buying agencies who talked with The Current.

Marketers have looked for shorter-term investments during periods of economic uncertainty in the marketplace, according to Ellyn Savage, VP of media at Mindgruve, a global digital agency based in San Diego, Calif. “On digital, you can change your message super-fast. It's a lot more flexible. So we've just seen a huge shift, and I think it makes sense that people would do that because of the volatility of the market.”

Advertisers are much more willing to buy CTV and video ads, Savage says, and no longer need prompting to invest in the channel. She suggests that marketers have finally caught up with the shift in user behavior, with more people than ever watching streaming platforms.

“CTV is everyone’s number one agenda item, and they are being very exploratory with the channel,” Brock Berry, the founder and CEO of digital ad tech company AdCellerant, tells The Current. He says marketers are increasingly willing to test and learn.

A new report from The Trade Desk Intelligence — The Sellers and Publishers Report — underpins these observations. The report tracks the drivers of growth on the open internet in recent years, using aggregate digital advertising activity across premium publishers since 2019. While the data highlights the growing value of the programmatic marketplace on the open internet, it also reveals how companies are using advertising on the open internet to align to where consumers are spending time.

CTV is at the forefront of this growth, an indication perhaps of the value that advertisers place on premium content. CTV now attracts more of consumers’ time than any other media channel, with three quarters of 25–44-year-olds surveyed having increased CTV consumption over the last year.

The consumer surge toward CTV also coincides with almost every major CTV leader now offering an ad-supported option. “There's just so much inventory, there's a big supply, not enough demand, so maybe it's looking like prices are kind of stable or more efficient for a little bit, but then it'll probably go the other way as dollars catch up,” notes Savage.

At the same time, the report reveals that advertisers are willing to pay significantly higher CPMs — for campaigns that run on premium destinations on the open internet when UID2 is present. It suggests that marketers perceive the greater value of running campaigns on quality destinations with the knowledge that they’re likely reaching a logged-in, authenticated audience that could drive better omnichannel results.

“CTV is everyone’s number one agenda item, and they are being very exploratory with the channel.”

Brock Berry, founder and CEO, AdCellerant

And even as marketers see CTV as an awareness play much like linear, they’re also keen to tie spend to business outcomes. “A lot of our clients operate more in the low to mid funnel just in general. It's always about trying to drive to a business goal,” says Savage. “We've seen, even with awareness budgets, a little bit of a shift to ‘what are the KPIs for it and what can we look at in terms of quality traffic?’ It's always about some kind of return, which is good. That's how we should be thinking about budgets."

The rapid emergence of CTV could be good news for marketers, even as they’re under pressure to suppress marketing budgets. According to agency executives, many clients are still eager to spend their budgets, they just want to be savvier about how they deploy those dollars.

Troy Lerner, the CEO of the agency Booyah, uses a driving analogy to describe the current mood as one of cautiously moving forward. “I would describe it as foot over the brake, not the brake pressed down to the floor,” he says. “Now it feels like it's going to be a wait and see based on every kind of near-term performance. So that's why I say foot over the brake, but the budgets are still coming.”

There’s a renewed focus on ROAS, according to Berry, spurred by engagement. When people changed their consumption habits as a result of the pandemic, marketers had to shift to more reactive ways of deploying their budgets. The current economic slowdown has only brought this reality into high relief. “A lot of clients are redirecting advertising toward digital platforms, and they’re raising expectations about how it should work,” he says. “It’s moving far more toward engagement, and that’s fostering greater value for their business.”

The Current is owned and operated by The Trade Desk, Inc.