Selling TV advertising in 2024 and beyond

Focusing on outcome-based products is essential. GroupM data suggests that around 80% of advertising budgets in the UK are spent on outcome-denominated products and this trend has been growing over the past decade. Moreover, our best estimate is that around 50% of video ad spending is also outcome-based, driven by social video on platforms like YouTube and Meta. Reach is no longer enough for many advertisers – understanding the value that reach creates is critical, hence accurate measurement of outcomes such as website traffic or sales is required. If the broadcast and streaming sectors cannot offer this, they risk falling behind.

We think of TV’s impact in terms of an ‘outcomes funnel.’ Historically, TV has measured reach, which we’d call an “output.” If the perceptions of the people who saw your ad change, then you’ve created an ‘out take’ and if their behaviour changes, that would be an outcome, which could be anything from searching for a brand online, to visiting its website (intermediate outcomes), making a purchase or paying more for a brand (a business outcome). Through our research, we’ve found that TV ads can boost search auction impressions by 5%, click-through rates by 7%, and conversion rates by 7%. TV advertising also defends against price sensitivity, contributing significantly to short-term profits. Geo-testing, an essential tool at ITV, enables us to measure the TV-generated uplift across a wide range of outcomes. By developing better measurement products, which are more rigorous and more accurate, we can offer insights that help advertisers maximise their TV ad spend.

The cost-effectiveness of BVOD depends on various factors such as the target audience, usage, and metrics compared with other platforms. While you might find cheaper reach on YouTube, it is crucial to consider cost efficiency and overall effectiveness. BVOD allows precise measurement using clean room technology to match one-to-one IDs, especially with logged-in users. Recent Thinkbox research found that profitability of BVOD varies by category; for example, financial services seems to benefit more compared with automotive. The picture is complex and will vary depending on a brand’s individual situation. So the key is to test and learn and find the use cases for BVOD that works best for the brand.

The amount of TV that people watch has remained remarkably consistent in the UK at around four hours a day. What’s changing is how they watch and yes, inevitably, viewing will shift from linear to IP-based delivery via Connected TV, a change that is very much underway among younger audiences. While some of this viewing is to streamers including ITVX, linear TV continues to be immensely powerful, reaching roughly 90% of the population each month. What’s really exciting for advertisers is the ability to make this linear audience addressable. So in the future we can have the best of both: mass reach and addressability across both linear and VOD.

ITVX differentiates itself as a British public service broadcaster, combining local strength with global content. Shows like Mr. Bates vs. The Post Office highlight ITV’s strength in creating emotionally powerful, culturally resonant stories. ITVX emphasises potent storytelling and high-quality entertainment, ensuring content is engaging and relatable. This focus on storytelling and entertainment sets ITVX apart from other streaming platforms. Our public service broadcasting ethos, commitment to emotionally powerful storytelling, and emphasis on entertainment collectively ensure that ITVX delivers content that feels authentic and engaging to its audience.

Yes, while the platform is important, it’s ultimately the content that sets us apart. Our brand identity and unique content are key differentiators. Product attributes can be copied, but our distinctive content and brand identity draw people to us. Although there is always room for platform improvement, our primary appeal lies in the unique and engaging content we offer.

Brands need a balanced mix of BVOD and linear TV, tailored to their audience. For younger audiences, a BVOD-first strategy complemented by linear TV works well. For older demographics, prioritise linear TV with BVOD as a supplement. Develop specific use cases for BVOD, leveraging data-matching capabilities to target segments accurately. Ensure campaigns are properly measured to translate investment into incremental profit. Clear use cases and effective measurement allow brands to gain proper value from their TV spend and balance it appropriately across different media channels. Companies such as Boots and Tesco use BVOD for specific use cases, leveraging data matching capabilities. Effective measurement is crucial for success in this approach.