Today, CTV enjoys the peak of popularity. During long months of quarantine, people formed new watching habits and eagerly switched to digital TV, leaving traditional television behind. Connected TV empowered them with a better option – to have their favorite series and shows streamed on-demand at any time. As the demand for CTV content grows, ad spending increases as well. The monetization opportunities of this brand new vibrant environment look appealing to every publisher. But how do they work? Let’s discuss.
What is an ad platform?
Generally, an ad monetization platform is an environment where publishers can sell their inventory directly to advertisers. Such websites allow publishers to monetize their ad space on CTV streaming services and make direct deals with the best brands. The platforms collect inventory from numerous publishers and offer advertisers access to that inventory for payment. Publishers can choose preferred brands to cooperate with, or entrust the choice to a bidding system – the highest bid gets the space at the time. An ad monetization platform allows publishers to partner with verified advertisers, reducing fees for middlemen.
What is real-time bidding in a CTV environment?
CTV ad exchanges arrange deals via real-time bidding, a so-called digital auction regulated by advanced algorithms. The deals are made in less than a second – finding the perfect publisher/advertiser match based on pre-set criteria decided by the parties of the deal, including the most important aspect – financial. As such, fair and transparent relationships are established between the parties.
The CTV environment attracts advertisers since it provides better chances for them to get high-quality impressions. Also, they can target the right audience and not waste too much time on budget planning – automated deals can help them optimize the process. Convenience and efficiency is another attraction for numerous brands to enter the CTV environment, which means that publishers should look at CTV the same way.
CTV monetization models
There are three monetization models for CTV channels:
AVOD ensures monetization through advertising: commercials appear within video content. The ads are displayed before (pre-roll), in the middle (mid-roll), or after (post-roll) the main content. Monetization platforms usually provide opportunities for creative and flexible ad delivery – they can take different forms and include interactive elements. AVOD content is usually free or partly free to watch. Monetization platforms for publishers actively utilize this model.
SVOD is a subscription-based model: users purchase channel subscriptions for a certain time period. This model generates revenue from subscriptions, while users get access to unlimited content streamed from their favorite channels.
BVOD means broadcast video on demand: users get access to TV channels’ content before or after they air. This model uses pre-rolls and mid-rolls for ad breaks that look exactly like a linear TV experience.
TVOD is a monetization method based on one-time transactions: users can subscribe for one or more episodes of their favorite show, instead of buying long-term subscriptions.
CTV video services usually provide diverse models to benefit from. For instance, Pluto TV or Tubi are focused on AVOD, while HBO prefers a SVOD model. Other popular services like Hulu and Roku provide both – AVOD and SVOD. The role of monetization platforms is to support publishers and provide them with the technical capability to realize their inventory after they choose a relevant video service and their required monetization strategy. Covering all the monetization models is possible, but pretty complicated – each has specific nuances to keep in mind.
The CTV environment is a fruitful field for publishers – modern services have a lot of great things to offer. Advertisers are chasing audiences longing for a flexible and cost-effective watching experience on CTV, which means that publishers should turn their gaze in the same direction. Different monetization models will suit the various preferences and competencies that publishers already have, while advanced ad monetization platforms can help them get the best results and meet the most reliable partners. Due to the bidding algorithms and rich pools of demanding advertisers, ad platforms have great potential to change publishers’ businesses for the better.