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The media and entertainment industry was abuzz with excitement over generative AI in 2023. Companies, driven by curiosity and a sense of urgency, began experimenting with this new technology, exploring its potential to disrupt the industry and transform themselves. This period of exploration and innovation quickly yielded tangible results, and by 2024, many companies successfully implemented AI solutions with measurable ROI and turned the AI conversation from “if” to “when”.

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As the cost of traditional streaming services continues to rise, consumers are increasingly turning to free, ad-supported streaming platforms (FAST channels) like Pluto TV. For advertisers, this shift presents an opportunity to reach diverse and engaged audiences in ways that have been largely overlooked. However, the advertising industry has been slow to fully embrace FAST channels. This hesitation can be traced back to a disconnect between decision-makers and the consumers they’re trying to reach. Many advertising professionals, who are often well-paid and white-collar, personally prefer premium, ad-free streaming services and fail to recognize the unique value FAST channels can offer.

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Connected TV (CTV) is a leading platform in digital advertising, combining the precise targeting of digital ads with the broad reach and storytelling power of traditional TV. This creates an immersive experience that offers full-funnel marketing results. As consumer time spent watching CTV has doubled over the past five years and linear TV viewing patterns have shifted, advertisers now see CTV as essential for reaching and engaging audiences.

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Within today’s AI-drenched industry conversations, it would seem that a lot of channels are on an accelerated path to an automated future. In many cases, that means a rapid shift of inventory into data-targeted, biddable buying. However, as eager as many digital media buyers are to get their hands on more connected TV inventory, this channel stands apart from others when it comes to its comparatively metered pace in moving away from upfronts and direct-sold inventory.

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(At the end of the article, watch a video interview with Lance Wolder and Will Richmond, Editor and Publisher of VideoNuze.)

As the advertising industry shifts from traditional linear TV to streaming, interactive ads have emerged as a novel way to cut through the clutter, leveraging the powerful personalization capabilities of Connected TV. Notably, QR codes have been gaining attention as a tool to drive measurable actions in ads. However, despite the buzz, their real-world impact remains limited. This isn’t just a QR code dilemma; it's a clarion call for a strategic shift.

Here's the thing: QR codes are known to all, yet scanned by few. The numbers don’t lie – while consumer awareness is through the roof, engagement rates have some catching up to do. It's a classic case of great potential, missed execution. Recent studies from Origin, LoopMe, and FlowCode shed light on the current state of QR code engagement. 95% of consumers are familiar with the concept of QR codes however a study from Brightline found a mere 0.02% of users scan QR codes in video ads. This begs the question: Why the disparity?

Simply put: Just because you can doesn’t mean you should.

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As a veteran ad executive once said, "Where there is mystery, there's margin."

Since its 2021 introduction, Google’s PerformanceMax (PMax) has aimed to drive ad performance by modeling historical performance data using Artificial Intelligence models. As an automated ad product, it appeals to those who want to "set it and forget it." Sounds great, right? Well, maybe.

Upon further inspection, the tradeoffs for the marketer emerge, particularly regarding transparency, autonomy, and brand suitability. Some recent findings from Adweek highlight this: Advertisers discovered that Google placed a significant portion of their PMax YouTube ads in the open web – not quite the premium placements they were expecting.

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Our industry loves to talk about the “streaming wars” and speculate on which of the big names out there—Netflix, Disney, Amazon, Apple, and so on—will ultimately “win.” This speculation has reached a fever pitch recently as more players have moved into ad-supported models (and Netflix has started gaining important traction in this regard). But here’s the thing: We don’t need to crown a winner. There are plenty of victories to go around when it comes to the immense opportunity of advertising within premium streaming environments.

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CTV is garnering industry headlines and M&A attention right now, with many industry observers happy to declare that “the year of CTV” has already come and gone. But the reality is that we still have a long way to go to achieve the full potential of CTV for advertisers.
 
For brands and agencies, the need to calibrate expectations, while still positioning themselves to unlock the tremendous potential of the CTV space, should be a top priority over the next 12 months. Here are five key areas where we still have a lot of work to do to integrate and elevate CTV to its proper place within the marketing mix.

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