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Brands Advertising on TV in Canada are Turning to Connected TV

Performance marketers advertising on TV in Canada are getting squeezed out of the remnant TV market.

The pandemic-induced increase in cord-cutting and digital video consumption resulted in a surge of demand for television inventory, which means less remnant inventory. Additionally, the stabilization of the economic outlook means advertisers who held back spending during the pandemic are back in the market.

Traditional Direct Response (DR) buying tactics are becoming a way of the past as the Canadian TV market is crowded, over-saturated and remnant inventory isn’t as readily available as it once was.

Purchasing remnant inventory (or pre-emptible) media means brands that rely on the reach of Linear TV to fill their marketing funnel are seeing significantly reduced clearance rates, causing uncertainty in acquisition or retention plans. Spot costs continue to increase 10-15% YOY, directly impacting Cost Per Acquisition (CPA) campaigns. While there is an option to convert some or all inventory to preferred (guaranteed placements) media, the associated costs of these placements erodes sales efficiency.

It’s become a spending game – and the highest bidder wins.

“We encountered similar marketplace conditions post - financial crisis in 2008; when brands came roaring back in 2009, the remnant market dried up” says Rebecca Barr EVP, Media Strategy & Investment for GainShare Performance Marketing. In 2009 there was no alternative for brands that rely on this inventory but today there is: the answer to the problem can be found in the rapidly growing Connected TV (CTV) Market.

“All of our customers are evaluating or implementing CTV buys as part of their strategy,” says Barr. “CTV provides flexibility in a tight marketplace and extends the reach of your Linear TV buy. Additional benefits include precise audience targeting and the ability to retarget consumers who have visited your site.”

CTV CPM's are higher compared to Linear TV since it cuts out wastage and delivers a more targeted audience compared to Linear TV's mass reach. With CTV, you are reaching an interest-level audience which drives increased conversion when integrated with Linear TV.

“Ultimately,” argues Barr, “for a true performance marketing campaign, it’s about efficient and high volume acquisition, and adding CTV to your integrated video strategy will result in increased acquisitions and management of efficiency as costs continue to rise for Linear TV.”

CTV is the most effective tactic to address the reality of today – audiences are leaving traditional TV. Cord-cutters and cord-nevers are growing at a double-digit pace – this year, 34.4% of non-pay TV households were cord-nevers, while 65.6% were cord-cutters. Reaching these valuable audiences through CTV has never been more crucial.

For brands that rely on TV to scale, high prices and low availability of remnant inventory is a major setback. The solution is an integrated Linear TV and Connected TV strategy that leverages all audiences, has retargeting ability and full-spectrum video attribution that allows brands to achieve the scale they want, at the CPA they need, on channels that work.

About the author

Chad MacKay, Senior Media Buyer/Planner

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