Binge watching TV shows has become as ingrained in our culture as baseball and barbecues. And CTV (connected television) is what has made this cultural shift a reality. It's already a well-established fact that people are switching to streaming services, with 225.7 million Americans watching CTV video content.
As streaming services continue to dominate, more and more viewers are moving towards free entertainment, challenging the prominence of subscription fees we see from some of the most popular providers in the industry. As a result, free ad-supported streaming television (F.A.S.T) options are filling that niche. In fact, 60% of US households that have a connected TV use F.A.S.T to enjoy their favorite TV content, making CTV a channel to watch for advertisers.
While brand advertisers currently dominate CTV ad spend, mobile app performance marketers are starting to get in on the action too. With the UA ecosystem becoming increasingly competitive, CTV has emerged as a new, visually engaging channel that can have significant appeal to app marketers looking to diversify their UA strategy. Despite this momentum, CTV remains an early-stage channel, especially when it comes to performance advertising, and brings with it challenges around measurement and optimization. Below, we look at the benefits and challenges of CTV for mobile app UA, so you can understand whether it’s the right addition for your app marketing strategy.
One of the first rules of advertising is to never put all your eggs in one basket. And for mobile app marketers looking for the next big channel, CTV can look like a new and innovative space that allows them to engage a mass global market, continue to use the same MMP partner, and see less competition per impression. The most important aspect of CTV is its ability to reach a diverse audience that are not active on mobile games or social media. CTV enables advertisers to reach these audiences, drawing in a diverse array of potential users. To add to this appeal, CTV also encourages incremental actions, even when viewers are not using their mobile phones. In other words, a CTV ad moves the user further along in their journey until they eventually install your app. For example, a user might see your ad, search for the app later, encounter another ad, and then decide to download it.
Another attraction of CTV from a mobile marketing perspective, is its ability to combine the impact and effect of traditional TV advertising, with a layer of data and measurement missing on this channel. This means, marketers can run full-funnel performance marketing campaigns, conduct A/B tests, and optimize for ROI. However, it’s important to note that while CTV measurement is better than traditional TV, it lags behind mobile due to differing device identities. Cross-device measurement is a challenge, with mobile measurement partners (MMPs) often relying on IPs (which can be shared across city blocks) to link TV impressions with mobile installs, resulting in false positives and negatives. This complicates performance evaluation and assessing pure incrementality.
Despite these challenges, a great benefit of CTV is its targeting capabilities. Many CTV platforms leverage proprietary identity graphs to target specific demographics like age and gender. They also offer features such as frequency capping, targeting based on ACR data (technology that collects data from the user of an internet enabled TV), and allow marketers to target ads by supply segment. But while its targeting may be on point, the funnel is another story. As opposed to mobile ads, most CTV ads don’t lead directly to the App Store or Google Play store. Instead, streamers may see an ad many times before searching for it, resulting in a lower conversion rate per impression.
Finally, another important consideration is pricing. CTV pricing is significantly higher than mobile, with CPMs ranging from $35-$65.
For many studios, it’s better to make sure they’ve reached their full potential on mobile, social media, and SDK networks before trying a new ad ecosystem–and this can be especially true for CTV. Because of its high cost, measurement challenges, and long conversion funnel, it is not beneficial for everyone. But for those that fit the criteria below, CTV boasts tremendous potential to boost UA and bring in new audiences.
Give CTV a go if:
You are a midsize or large studio
CTV is ideal for midsize and large studios that have already maximized traditional advertising channels and have large enough budgets to test new ecosystems to make sure it works for their specific genre. It’s recommended to invest at least $30-$50K to evaluate any new channel before going all in, so make sure to have that kind of cash at your disposal before getting started.
You have high LTV and above average benchmarks for your genre
Because the CPM is higher and the IPM is lower on CTV when compared to mobile, apps need a high LTV to make it worth the cost. This makes it best for studios that are producing puzzle, casual, mid-core, and hard-core games over hyper-casual games (due to their low LTV). Additionally, it’s important to make sure the core business is on a positive trajectory, by having above average benchmarks for its genre.
You target a US audience
The CTV ecosystem is the most mature and penetrated in the United States. Therefore, if your app is popular outside of the US, CTV is likely not relevant for you.
CTV is an emerging market that's about to become a significant player for app marketers. With over 1.1 billion CTV devices globally, CTV is a strong platform for established gaming and app publishers to scale app businesses, enhancing both brand and performance.
Unity’s Director of Sales, David Amar predicts, "CTV offers massive scale and opportunity as part of a holistic performance marketing approach. As F.A.S.T. services continue to grow, I predict that CTV will evolve into a powerful direct response channel, leveraging advanced targeting and closed-loop attribution to drive deeper engagement, precise insights, and measurable ROI, reshaping how advertisers connect with audiences."
