Executive Summary

Demand for advanced TV advertising—including addressable, programmatic and connected TV (CTV)—continues to accelerate as viewers migrate across platforms and marketers look to improve ad effectiveness through precision targeting.

What new ad inventory sources will accelerate addressable TV ad spending?

Addressable TV is hot, attracting ad dollars of $2.00 billion in 2019 and reaching $3.49 billion in 2021, we estimate. Satisfying future addressable demand means finding new sources of ad inventory, beyond what multichannel video programming distributors (MVPDs) currently make available. The 15 minutes per hour of national TV ad time is a potential new addressable ad source, subject to business agreements between TV networks, MVPDs and smart TV makers. CTV is another option for expanding ad opportunities.

How much ad spending will programmatic TV get?

We estimate programmatic TV ad spending will reach $6.69 billion by 2021, more than doubling its current $2.77 billion level. Automation of TV buys on the front end is evident as buyers and sellers step up their use of demand-side platforms (DSPs) and supply-side platforms (SSPs). Meanwhile, automating the order management and stewardship steps of the transaction process is in a very early stage.

What ad planning and buying practices are in motion to inform CTV ad investment allocations?

Media agency TV investment groups use CTV to extend linear TV plans’ brand target reach while digital teams plot CTV performance strategies. In the future, traditional and digital TV strategists will likely work more closely to deploy strategies informed by planning systems that bridge the gap between linear and CTV viewing.

WHAT’S IN THIS REPORT? This report looks at growth estimates and the key drivers for addressable, programmatic TV buying and CTV.

KEY STAT: Addressable and programmatic TV spend is small but rapidly growing compared with flat ad dollars expected for traditional TV.