Videology: Connected TV Ads Have Great Completion Rates — And High Prices To Match

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January 30, 2012 – 6:19 pm

Given the nascent quality of connected TV advertising, it's hard to really offer a substantive comparison between the value of such placements versus the comparatively more established PC-based video and mobile ads.

But you have to start someplace and Videology (the video ad network recently formerly known as TidalTV) has a few stats that appear to offer further evidence of the complementary quality of connected TV media buys as part of a larger video ad strategy.

Since there's currently no uniform way to "click" a connected TV video ad the company's study (pdf) discusses the value of video completion rates (VCR) for ads seen on wifi-enabled televisions.

The number that jumps out about connected TV ads is that it has a 110 percent video completion rate over regular online video. As if that we're special enough, mobile video's completion rates are around 10 percent lower than ones seen on PC-based web video ads. And the prices for ads across those devices tend to reflect that.

As Videology notes, the divergence in completion rates between mobile and connected TVs make obvious sense: mobile phone users tend to be on the go and given 3G buffering, people give up on a video that doesn't load in a matter of seconds. With wifi-TVs, users probably are planted on their couch and home connections tend to be infinitely better than access a user can get on a street or a moving bus/train.

For an advertiser looking at click-through rates, mobile is still a very good addition, as smartphones deliver a 350 percent CTR increase for an average price increase of 30 percent. That’s a very strong, over 10 to 1 ratio.

If  "engagement" like video completion is the main aim, connected TV delivers improved completed views at a ratio of 2 to 1 compared to cost increases, which is roughly 54 percent higher than online video prices.

But do these improved rates equal the cost required to reach them?

Videology just looked at eight campaigns -- it doesn't identify them further -- and found that using multiple screens showed brand lift
increases between 70- and 300 percent, while the online video campaigns showed brand lift in the 15- to 130 percent range.

On average, multiple screen campaigns using  online video, mobile and connected television screens showed average brand recall rise 9 times higher than those relying solely on online video.

However, factoring in the cost, per incremental brand lift actually decreased by 55 percent.

That sounds pretty negative off the bat. But it assumes that all campaigns are equal and they're not. Some would do better with a little more mobile, others would do better with a little more connected TV. Again, it depends if the goals are more "reach/frequency-oriented" or more focused on engagement.

Videology is pretty clear: just using one sort of device isn't enough. While it's hard to generalize, the company estimates that optimal mix to achieve both scale and performance should always include between 60 percent and70 percent online video.

Mobile, which just hit $1 billion in ad spending this year (versus roughly $30 billion for total online and $12.33 billion for display alone, per eMarketer numbers) still has a ways to go in terms of figuring out its true value as ad segment. That is even more true for connected TVs.

Over the next year, the number of ad impressions across mobile and connected TVs should grow quickly. It'll be interesting to see how the value of each is perceived and which one appears to mature faster.

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January 30, 2012 – 6:19 pm

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