IAB Canada Briefing – Connected TV in Canada

AVOD Gaining Ground with Canadian Viewers

Reported by IAB Canada contributor Paolo Lacuna

Last year, we had the privilege of featuring Dave Pauk, Samsung Ads Canada Regional Sales Director, who shared some insightful Connected Television (CTV) predictions. In that article, Dave explains that CTV will continue to grow and mark 2023 as the “Year of CTV.” This surge can be attributed to the steady expansion of the streaming audience, with advertisers increasingly turning to Programmatic CTV to improve reach and transparency. In this era of diverse streaming options and the dramatic rise of ad-supported video on demand (AVOD), viewers have become very selective about the content they consume. To remain relevant in this dynamic CTV media landscape, advertisers must adapt and prepare to ride the wave of constant evolution.

As Q4 2023 approaches, it’s worth noting that Dave’s forecasts are accurate. The realm of CTV advertising is turning out to be more exciting and promising than ever before. 

If you’re new to CTV, here is the brief. CTV, simply put, refers to the delivery of TV video content to any smart device (Smart TV, desktop or laptop, tablet or smartphone) all through the internet. It is often used as an umbrella term for the category that can include delivery of video via OTT, CTV and more. CTV also encompasses different methods of content delivery, whether linear or real-time broadcast or non-linear via Video on Demand (VOD). VOD is further divided into Subscription Video on Demand (SVOD), where users pay a monthly fee to access content, or Ad-Supported Video on Demand (AVOD), free-to-watch content monetized through advertising. 

According to Statista projections, digital video viewership is on a steady rise and poised to grow by half a million viewers between 2022 and 2023, with a promising outlook of 30.1 million viewers by 2026. This is driven by viewers’ desire to enjoy what they want, when they want, or access vast and diverse content.

The study also reveals that the percentage of Canadians 18 and older paying for SVOD services has slightly decreased from 80% to 76% in 2023. The main reason cited for canceling or downgrading was to save money. Nevertheless, Netflix maintains its huge lead in SVOD, closely followed by Amazon Prime Video and Disney+.

Conversely, viewership of AVOD services increased in Canada from 78% to 80% during the same period. This uptick was even more pronounced among 18-to 34-year-old Canadians, rising from 87% to 92%. YouTube remains the dominant player in the AVOD arena, capturing the attention of 88% of viewers. Local networks such as Global News, CTV, and CBC Gem, CityTV also carve out a significant audience share, attracting a quarter of total viewers each.

The growth trend also extends to Free-Ad Supported TV (FAST), with viewership in 2023 surging from 8.1 million to an impressive 9.8 million.

Notably, nearly half of Canadian viewers actively engage with content across SVOD, AVOD, and FAST. It’s important to highlight that only a mere 5% of Canadian viewers exclusively rely on AVOD and FAST to watch their content. This should be considered when building a marketing strategy to ensure comprehensive reach and engagement across the diverse Canadian audience.

A significant majority of Canadians, three out of four, choose TV as their preferred screen for streaming shows and movies, cementing its position as the most popular medium for CTV consumption. This is followed by desktops and laptops, with about half of Canadians choosing these devices to watch digital video content, followed by mobile devices.

Advertisers should pay attention to the CTV audience, as these viewers spend an average of 1-2 hours per day watching video content, according to a Vividata study. What adds to CTV’s appeal as an advertising medium is its effectiveness in capturing viewer attention. Remarkably, 60% of CTV viewers noticed ads while consuming content weekly. This level of ad engagement is rivaled only by traditional TV, where 69% of viewers acknowledged seeing ads.

When buying CTV advertising, “programmatic” is a buzzword to remember. Programmatic leverages the power of data and automation to purchase and deploy ads in real- time, optimizing targeting and efficiency. With programmatic advertising, advertisers can reach their target audience precisely when and where it matters most, while maximizing their budgets. By utilizing audience data, they can create tailored campaigns perfectly tailored to viewers` preferences, driving increased engagement and ultimately resulting in a better ROI.

This year, CTV advertising unmistakably stands at the forefront of the advertising industry. Its data-driven precision, interactive capabilities, and measurable outcomes make it an indispensable tool for advertisers. As the Canadian audience increasingly embraces CTV and AVOD, advertisers have a unique opportunity to connect with viewers in a meaningful way.

Join Us at IAB Canada’s Data Night on CTV

To fully unlock the potential of CTV for your brand, join us at IAB Canada’s Data Night dedicated to CTV on September 21st. This event promises an evening of deep insights, interactive discussions, and expert presentations. Learn how to harness the full power of CTV while networking with industry leaders. Don’t miss this exclusive opportunity and reserve your spot today!