New to streaming? Embrace the future of TV advertising with Roku.
Streaming services have taken over as the preferred way to watch TV, surpassing both cable and broadcast in total TV viewing.
The paradigm shift has prompted savvy brands to reallocate advertising budgets to TV streaming, and they’re reaping benefits like enhanced engagement, broader audience reach, exclusive audience (people not reachable in traditional linear TV) and precise ROI tracking.
For those who are just getting started with streaming advertising, we’ve put together some key terms, definitions and strategy tips that will start you on the right foot.
TV streaming: A few definitions
Let’s start with some definitions. From an audience perspective, there are a few main ways to stream TV.
Subscription Video on Demand (SVOD). Think Netflix, Disney+, Amazon Prime, or Max. These platforms offer on-demand content for a subscription fee. While many of these services launched without ads, most have recently added ad-subsidized tiers at a lower cost to subscribers.
Advertising-based Video on Demand (AVOD). Free on-demand content with ad breaks. Examples include The Roku Channel and Tubi. AVOD is growing its share of TV streaming watch time.
Free Ad Supported TV (FAST). It can be tricky to distinguish FAST from AVOD. One key difference is that FAST includes real-time, scheduled programming (i.e. live TV) for free, supported by ads, whereas users access AVOD content on their own schedule. But here’s where it gets confusing: FAST is sometimes also used to describe on-demand shows and movies that are free and ad-supported. So think of FAST as an expansive term that includes both live and on-demand content, so long as it’s ad-supported and free of charge. Examples: The Roku Channel, Pluto TV, Xumo.
What does streaming look like?
Like digital advertising as a whole, TV streaming ads can take many forms. For example, when Roku users power up their devices, they see a home screen (see below) that contains a menu of apps and a prominent ad placement that reaches all 75 million-plus of Roku’s active account holders.
This interface is consistent across TV devices, whether they are Roku-branded or non-Roku TVs connected to Roku players.
Most people spend about 11 minutes deciding what to watch.¹ During this time they may conduct searches, navigate among their preferred streaming apps and see ads for live and upcoming programming.
Once they settle on a show or movie within Roku’s OS, the viewer is taken to the app or service in question, where they can start watching. If they are viewing on an ad-supported channel like Pluto TV or The Roku Channel, they may see an ad immediately before their requested show streams and periodically throughout the program.
Ad-supporting streaming is soaring
Ad-supported TV streaming is on the rise. In fact, 48% of time spent viewing CTV went to ad-supported apps (up 55% from the end of 2020), and just 26% of SVOD (down 30%).² Why the sharp rise in ad-supported streaming? Cost. Viewers who are sensitive to the rising cost of paid subscriptions have found that AVOD and FAST provide access to deep libraries of quality content at no charge. Also, Roku data reveals that average AVOD viewership increases significantly when users transition away from paid subscriptions.³
Bottom line: AVOD and FAST are gaining huge audiences that can’t be found on linear TV, and smart advertisers are capitalizing.
TV streaming offers innovative ad formats
When it comes to ad formats, advertisers have more creative options in TV streaming than they do in traditional linear TV. Those options include the familiar 15- and 30-second spots that were developed decades ago and are injected into breaks in programming, as well as emerging ad experiences that are native to streaming platforms.
Examples include immersive content destinations, home screen themes, and interactive in-stream ads that enable specific viewer actions such as a purchase. For instance, Warner Bros. Pictures and Mattel used multiple unique formats to promote the “Barbie” movie on Roku. Barbie and Ken greeted viewers on the Roku home screen, Barbie’s Dream House appeared in Roku City and native ads guided users to watch the movie trailer or purchase tickets with a QR code.
How to buy TV streaming ads
There are two ways to purchase streaming ads:
Programmatic: Ideal for performance marketers and smaller brands, this approach uses data to automate the purchase of ads across a variety of shows and services, typically limited to standard video ads.
Buying direct: Going direct gives you a larger creative canvas. Brands and agencies can use managed services from Roku and other media sellers to unlock tailored support and unique ad formats. By buying direct, it’s easier to optimize content mix and activate unique ad formats. For example, Coca-Cola worked with us during the 2023 holiday season to sponsor a special culinary content destination and one-of-a-kind integration within Roku City.
Measuring streaming success
Streaming comes with a spectrum of tools and methodologies to assess campaign impact at all stages of the purchase funnel. Roku offers:
Upper-funnel metrics. Assessing reach and resonance in streaming is straightforward. Advertisers can work with MRC-accredited partners like Nielsen and iSpot.tv to assess unduplicated reach among desired audiences — across both streaming and linear. They can also conduct brand lift studies to understand how their campaigns impacted awareness, favorability and ad recall.
Mid and lower-funnel metrics. This is where streaming shines. Advertisers can link Roku’s subscriber data to a range of endpoints to understand how well their campaigns drove online visitation, conversions, and sales.
Campaign verification. Advertisers can also apply many of the brand safety and ad verification tools that have become widespread in digital. Roku supports DoubleVerify, Integral Ad Science and other vendors that give brands confidence that their campaigns are running in clean, well-lit environments.
Roku’s measurement partners are available to help you understand the full impact of your TV streaming campaigns.
Why choose Roku?
Make your brand unmissable by partnering with Roku to reach the ever-growing audience of TV streamers. Our diverse ad formats, extensive audience reach, and robust measurement tools can set your brand up for streaming success. Benefits include:
- Marquee Ads that reach 75 million active accounts on the Roku home screen.
- Streaming ads in The Roku Channel and across a wide range of ad-supported TV streaming services.
- A variety of ad formats from content destinations to contextual video ads and action ads.
- Roku partners with the very best in measurement, from Nielsen to Kroger Precision Marketing.
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¹ Nielsen Streaming Content Consumer Survey, June 2023
² Source: TVision, State of CTV 2H 2022
³ Average Hours Spent Streaming AVODs Among SVOD Churners January – August 2022
