Television is evolving into a critical channel for marketing brands, according to a report released Monday by market research and technology company Circana.
The report, “The Future of TV: Where it Meets Commerce,” found that 75% of American households subscribe to ad-supported streaming services, pushing TV to an unprecedented level of transaction readiness.
Television has moved from a one-way interaction to a two-way interaction, she explained, opening up new opportunities for advertisers to engage audiences more effectively.
Advertisers looking to maximize the impact of their marketing dollars can do so by embracing interactive TV, according to Circana, which reported that connected TV now delivers a higher return on advertising investment (ROAS) than linear TV by more than 15% and short-form video by more than 21%.
These performance increases show that TV is moving from a reach vehicle to a full-funnel platform and results, the report argues.
“These findings make sense based on what I see every day with pet brands,” confirmed Patricia Jones, CEO and co-founder of New York-based Paws PR, which produces TV segments for pet brand product placement.
“Anyone who tunes in to an Internet-connected TV intends to view the content they’re interested in,” she told the E-Commerce Times. “On TV connected to the Internet, brand content is truly relevant to the customer.”
Rethinking the journey
“Streaming video and Internet-connected TV, in particular, have absolutely tended to outperform linear TV,” said Michael Goodman, senior analyst at Parks Associates, a Dallas-based market research and consulting firm specializing in consumer technology products.
He explained that ad-supported streaming has changed the way brands think about the journey – the journey a consumer takes from first learning about a product to buying it.
“Ad-supported streaming is turning video into a data-driven, interactive and measurable channel with more precise discovery, more dynamic storytelling and purchases that become immediate and actionable,” he told the E-Commerce Times. “This fundamentally changes the way brands plan and execute campaigns.”
Katherine Cartwright, co-founder of Criterion Global, an international media buying agency based in New York, agreed. “Two-way interaction is a reward for measuring quality,” she told the E-Commerce Times.
“TV can become a feedback loop,” she said. “Viewers don’t just watch, they respond, search, scan and transact. Every broadcast can now be measured for a potential downstream signal, fundamentally changing the way we plan and optimize campaigns.”
However, contrary to Circana’s findings, it argued that linear and short-form TV could outperform CTV. “We’ve done it many times,” she declared. “The reality is that the technology has evolved faster than the means to universally measure it, and most advertisers don’t know how to measure video strategy holistically.”
Environmental interactions
Streaming and TV have gone hand-in-hand for some time and are an accepted, expected part of the consumer experience, noted Aaron Smedley, CEO of Shopify at Cloudinary, a global image and video platform. “This means that video has evolved from being just a one-way channel for storytelling to now having to function as a storefront,” he told the E-Commerce Times.
“With streaming, video is always on and accessible, which has completely changed the discovery game for advertisers because it’s now found through delivered content, not just search,” he explained. “Video directly drives action, meaning content providers must meet consumers’ expectations for high quality with fast loading and a completely seamless experience.”
“Even though video is now more effective than ever, consumer patience is still very thin,” he continued. “If something is slow to load, the quality is poor, or the content isn’t personally relevant, the consumer moves on very quickly and that engagement is nearly impossible to regain.”
“Ultimately, television has stopped being a one-way delivery,” he added. “Viewers can go from watching to taking action in an instant, turning video into a more interactive, two-way experience for both the advertiser and the consumer.”
Connected TV is interactive, but not always in an obvious click-the-remote-to-buy way, says Mike Pierce, streaming statistics and data partnerships lead at JustWatch, an online streaming guide with information on more than 200,000 movies and TV shows.
“The interaction often happens around the TV rather than on the TV,” he told the E-Commerce Times. “Viewers watch on the big screen while browsing, searching, texting, shopping or using social platforms on another device.”
“So television is becoming more interactive, but not necessarily because the television interface itself is suddenly highly interactive,” he explained. “It’s interactive because it’s part of a larger loop of behavior across multiple screens.”
A market redefined by youth
The Circana report also noted that younger viewers and millennials are key audiences due to their size, spending power and viewing preferences. It is estimated that by 2030, Gen Z and Millennials will dominate the US population and drive 60% of retail sales growth.
“Younger viewers have redefined the television market directly because of how they see television itself,” said Cloudinara’s Smedley. “They no longer separate TV from digital content.”
“For younger viewers, everything is universal content, regardless of what channel or format it’s delivered to them,” he explained. “Every screen – laptop, tablet, mobile – is a content system.”
“Platforms like TikTok and YouTube aren’t really considered social media anymore,” he continued. “Instead, they’ve become another content vehicle because of the long-term daily engagement these platforms see.”
“They want relevance, lower ad load and control,” Criterion’s Cartwright added. “This forces brands to gain attention, not just buy forced opinions.”
Results oriented results
Even though TV is becoming a growth channel driving commerce, most brands still treat TV production and e-commerce as separate departments with separate planning and budgets.
“Connected TV has the potential to break down barriers and reduce the distance between the two, so that every production functions simultaneously as entertainment, persuasion and a point of purchase,” said Tavares Beverly, president of Beverly Boy Productions, a global video production company.
“While such a shift requires coordination both on and off set, some of our best campaigns have come from bringing teams together to achieve a common goal from the start,” he told the E-Commerce Times. “Imagine manufacturing, marketing and sales coming together from the ground up to ensure the highest possible return on ad spend. This kind of integration is able to connect to television behind the scenes.”
“I think the big takeaway is that brands and advertising in many ways are moving toward results-oriented,” noted Parks’ Goodman. “The expectation is that you can have a measurable return and that the return on your advertising dollars is more than just awareness.”
“Whether it’s actionable ads, shoppable ads, retail media,” he continued, “all of these things come together to create actionable results for advertisers that are deep in the journey, close to the purchase, or close to the outcome they’re trying to achieve.”
“It’s important not to define the TV business too narrowly,” added JustWatch’s Pierce. It’s not just about clicking “buy now” with your remote. This may become more common, but the bigger opportunity is the connection between attention and intention.”
“The brands that thrive on CTV will be the ones that don’t treat it as just another digital ad placement,” he said. “It needs strong creativity, a clear audience strategy and a realistic view of how people actually behave, often watching TV but acting on another device.”