How Much Do CTV Ads Cost?
Connected TV (CTV) advertising refers to the practice of delivering video ads to viewers via internet-connected devices, such as smart TVs, streaming devices (e.g. Roku, Amazon Fire TV, Apple TV), and gaming consoles. CTV advertising allows brands to reach a large and diverse audience, including cord-cutters (i.e. people who have cancelled their cable or satellite subscriptions) and people who use streaming services as their primary method of watching television.
The cost of CTV advertising can vary widely depending on a number of factors, such as the platform, the target audience, and the ad format. One of the most significant factors that affects the cost of CTV advertising is the platform. Different platforms have different costs associated with them, and these costs can vary depending on the platform's audience size, demographics, and ad inventory.
For example, one of the most popular CTV platforms is Hulu. Hulu's ad inventory is relatively limited, and its audience tends to be highly engaged with the content they are watching. As a result, the cost of advertising on Hulu can be quite high, with CPM (cost per thousand impressions) rates typically in the range of $15-$40.
Another popular CTV platform is YouTube TV. YouTube TV has a much larger audience and ad inventory than Hulu, and its CPM rates are generally lower, typically in the range of $10-$20.
There are also a number of other CTV platforms, such as Sling TV, DirecTV Now, and PlayStation Vue. These platforms typically have smaller audiences than Hulu and YouTube TV, but they may also offer more targeted ad inventory and lower CPM rates.
In addition to the platform, the target audience also plays a role in determining the cost of CTV advertising. Advertisers can target their ads to specific demographics, such as age, gender, income, and location. The more specific and targeted the audience, the higher the cost of the ad will be. For example, targeting a highly specific audience, such as males between the ages of 18 and 24 who live in a specific city and are interested in sports, will cost more than targeting a broader audience, such as all viewers in a specific region.
The ad format also affects the cost of CTV advertising. There are several different ad formats available on CTV platforms, including linear ads (which are similar to traditional TV ads), video on-demand (VOD) ads, and interactive ads. Linear ads tend to be the least expensive, while interactive ads are typically the most expensive. The cost also depends on the ad's length, the type of ad (bumpers, pre-roll, mid-roll, post-roll) and how they are placed in the content (e.g. skippable or not, frequency capping).
In general, the cost of CTV advertising can range from a few cents to several dollars per thousand impressions (CPM).
The average CPM for a 15-second ad can be between $5 to $20. Longer ads have a tendency to have a higher CPM rate. A 30-second ad can be between $10 to $30.
It's also worth noting that CTV advertising often comes with bundled packages, or a minimum monthly or annual spend, so it is important to keep in mind the overall costs and goals of the campaign, and consider if this fits the budget or not.
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