Solving for Addressable TV's Signal and Reach Challenges

A look at Amazon Ads' strategy

Connected TV (CTV) is rapidly transforming the advertising landscape. As of 2022, 92% of U.S. households can be reached through CTV programmatic advertising, and this medium is expected to double in growth within the next five years, according to the IAB Outlook survey. This trajectory suggests that by 2027, CTV will account for 41.8% of total TV ad spending. In turn, this trend emphasizes the crucial role of CTV in any omnichannel strategy, as advertisers aim to captivate consumers through diverse screens and moments in their everyday lives. 

However, the growth isn’t all rosy. According to recent surveys from Imagine Communications and MNT Research, respectively, 74% of advertisers feel that the quality of targeting signals needs enhancement, and 48% of advertisers find measuring reach across different platforms to be a top concern. 

Let’s explore the way Amazon Ads solves for addressable CTV and see how it can help tackle these pressing issues.

Reframe addressability

In the current advertising landscape, addressable CTV is often shoehorned into narrow definitions, such as ad identifiers or inventory recognition. For Amazon Ads, it’s the art and science of deploying timely, relevant advertising in a connected TV environment, all predicated on real-time, privacy-safe signals spanning a multitude of supply sources.

Last year, during the unBoxed conference, Amazon Ads unveiled signal-based marketing as the foundation for its forward-looking approach. Fast-forward to today, this methodology has been tried and tested. By bringing together machine learning with evolving signals—from Amazon aggregated insights to advertiser’s first-party signals—audiences can see more relevant messages in more locations. 

“Signal-based marketing allows brands using Amazon DSP to engage consumers with relevant, useful advertising, as opposed to repeatedly showing them an ad for a product they had considered and not purchased,” explained Neal Richter, director of bidding science and engineering at Amazon Ads.

Scale audiences through modeling and context 

Unlike desktop or app advertising, the targeting options on CTV environments have primarily relied on general demographic, genre or geographic signals. These limited options may not adequately address the unique needs and goals of specific advertising initiatives, highlighting a need for more nuanced signal utilization in CTV. Advertisers working with Amazon Ads now have an unprecedented range of options to connect with engaged audiences at scale, whether through modeled audience segments or contextual deals. 

For starters, advertisers can extend the use of the standard catalog of Amazon Audiences to CTV environments. These audiences, based on in-market, lifestyle and demographic categories, now leverage signal-based marketing and can predict real-time interests that serve more relevant messages than before. With these improvements, Amazon Ads’ addressable reach on CTV has nearly doubled (from 37% to 73%), giving advertisers greater confidence on where their ads are placed. 

Additionally, advertisers can reach engaged audiences at scale due to expanded deal options. New curated deal opportunities, based on contextual signals, give advertisers preferential access to premium first- and third-party supply—from “sports fans” or “news buffs” packages across supply types, to contextual-based ways to reach streamers on Twitch or binge watchers on Freevee. 

Forge industry alliances and interoperability

The CTV landscape offers consumers a wide array of choices in devices, apps and publishers, enhancing their viewing experience. However, this diversity leads to ad-tech fragmentation, posing challenges in targeting, frequency capping and measurement. Therefore, building lasting relationships and interoperability are essential for success to fully leverage CTV’s advertising potential.

At unBoxed 2023, Amazon Ads announced Amazon Publisher Cloud (APC), a clean room service, built on the robust foundation of AWS Clean Rooms, that facilitates secure and streamlined collaboration between Amazon Ads and its publisher and advertiser customers. As a result, publishers can analyze their first-party signals alongside Amazon Ads insights, create customized and highly addressable deals, and easily make them available on Amazon DSP. 

Amazon Ads has also worked on further expanding addressability beyond its own Fire TV devices by integrating with major TV manufacturers. This effort has led to an 85% addressability rate across non-Fire TV devices, which means that advertisers leveraging Amazon Audiences or their first-party signals can now extend their reach more effectively across all devices. 

But none of this works without a critical component of advertising success: measurement. Of course, measurement is not a one-size-fits-all approach—that’s why Amazon Ads’ suite of first-party measurement tools is designed to provide insights that matter to advertisers. And finally, we’ve also cultivated a strong network of third-party partners – to keep ourselves accountable for true impact.

The road ahead

The rapidly evolving CTV advertising landscape is reshaping the way advertisers reach audiences. With its significant growth and rising importance in ad spend, CTV has become a focal point in the advertising industry. As the industry advances, the potential of CTV advertising continues to grow, promising a more responsive and audience-centric advertising environment.

Aditya Desai is a senior manager, product management for Amazon Ads, where he works to create alternate ways for the Amazon DSP to deliver high performance and high reach ad campaigns and report on them without a dependency on third party cookies and user identifiers.