While we only do Google and Microsoft Ads at ZATO, I try to keep an ear to the ground of marketing and industries in general. I think Identifying trends can be helpful, especially since Search and Shopping Ads capture the demand created on many of these other channels... for instance, like CTV and OTT. By the way, if you're like me and a little unclear, CTV is the hardware of connected TVs, though I've also seen it used to describe the channels or ad placements themselves... and OTT (over-the-top) is the ad placements, especially on Live and Streaming internet TV.
My pondering today is on CTV budgets & growth.
According to AdWeek, CTV ad spend grew 57% from 2020 - 2021 and is projected to grow another 39% from in 2022. So clearly, it's already growing as a channel in terms of importance and advertiser investment.
But what about after?
I think CTV is going to absolutely explode (in growth) as we head towards a recession. Am I allowed to say we're heading towards a recession? I mean, okay sure it could change, but literally every sign of an impending recession is out there, so I'm taking the mindset of "prepare for one and rejoice if it doesn't actually happen."
But back to CTV/OTT, more people will stay at home and turn to streaming during a recession rather than spending money on external, more expensive entertainment options because, well, they don't have as much money.
What about the last recession? Do we have data to support this?
Curiously, Netflix began its streaming services in 2007 (the last recession ended mid-2009) so there was technically streaming during that era... but there were only 9.4M subscribers to Netflix in 2008 (and no alternate streaming options yet).
So we don't really have a good way of telling if streaming has gone up in past recessions, BUUUTTT importantly, television viewing itself went up during the 08 recession so there is (in my opinion) precedent to expect that to occur again... but this time within streaming itself (or perhaps, both).
So, to recap in the growth potential of Netflix alone :
- 2008 Netflix subscribers: 9.4M subscribers
- 2022 Netflix subscribers: 178.5M subscribers
That's just one streaming service of many now live with millions of subscribers (my personal favorites being HBO Max, Disney+, and Paramount+). Keep in mind, Microsoft recently signed on with Netflix in order to run their upcoming ads option as well.
Yeah, I think we can safely assume CTV is going to explode with growth in 2023.
Finally, let's add one more piece to the 🧩.
Let's toss in, oh you know, a significant increase in digital privacy regulations and concerns slowly kneecapping more "traditional" digital ad targeting channels, and you have people looking for places to stuff big budgets just as CTV grows in number and interest as a very solid ad channel.
The perfect storm 🌪