The Demise of Third-Party Cookies is CTV’s Opportunity to Shine

On January 4th, we finally reached the beginning of the end of third-party cookies (for real this time?) On that date, Google Chrome began removing 3rd party cookies from 1% of traffic. By the end of the year, 3rd party cookies will be completely eliminated from Chrome and opening a new opportunity for CTV.

This industry-altering event has brands and agencies further reconsidering their marketing mix. While the digital advertising space will survive this end of third-party cookies, I agree with the many media outlets that predict CTV has much to gain from the weakening of digital advertising.

Despite the rise of CTV viewership at the expense of linear, advertising has lagged behind. According to Nielsen, 38.7% of TV viewing occurs via streaming, but Insider Intelligence found that CTV ad spending was only 29% of all TV ads in 2023.

The CTV advertising ecosystem does not depend on third-party cookies like digital media. As such, I expect there will be many first-time CTV brands this year, or for some–an uptick in spending, who may need some guidance on how digital and CTV advertising are similar and different.

Here’s what they need to know:

1. Explore your options. You can buy directly or programmatically with individual publishers or through aggregators. Similar to digital, you can do targeted buys or buy across the ecosystem. The biggest platforms you can buy on are Hulu, YouTube, and Roku. In addition, there are free ad-supported streaming television networks (FAST) like Paramount’s Pluto TV and Fox’s Tubi. Also, larger prestige publishers like Netflix, Max, and now Amazon have ad-supported tiers. Finally, some smaller, niche platforms may be perfect for your audience. But the reality is that a true “long tail” has yet to emerge from CTV advertising when considering “view hours.” A majority of viewership goes to the top half-dozen apps or so, which is different from digital, where there’s effectively infinite inventory.
2. Demand the most important data from the platforms. CTV publishers know a great deal about the audiences watching their programs. They know the viewing habits of the audience(s), where those viewers are located, and what types of devices they’re using to access CTV content. Ensure you utilize this available information and insist on other deep and accurate data for targeting upcoming campaigns.
3. Set up real-time measurement and monitoring: CTV combines the targeting capabilities of digital mentioned above with the lean-back experience of linear. To fully take advantage of this, monitor all aspects of CTV advertising brand performance in real-time, including causal media effectiveness and on-target accuracy by platform, program, and genre. Don’t wait until a campaign is complete to see if it was successful. Fortunately, measurement platforms exist where you can get real-time access to how campaigns perform across all your CTV advertising campaigns.
4. Measure the right things: Brands need to connect the dots between exposure and outcomes, whether they be brand-, behavioral-, or business-based. CTV is an excellent medium for brand-building–you are likely advertising during consumers’ favorite shows or a compelling new movie (those lean-back experiences), which is a perfect time for encoding emotional resonance to ads and building awareness. Shoppable commerce is not ready for prime time yet. So, it is important to think past solely sales lift and measure, understand, and optimize towards a broader set of outcomes.
5. Know who is in the room: While CTV has several advantages to linear TV, it also inherits two major challenges from it, both regarding who is in the room. The first is co-viewing, which relates to how many people watch something at any given time. E.g., if two households are watching a movie on Hulu, one may just be a solitary individual and the other may be a family of four. The other is audience profiling. Knowing which member(s) of the household are actually watching and, therefore, whether they are the ideal target recipient of an advertiser’s messaging. There have been many strides to address this “knowing who is in the room” problem, but more work must be done here.

There’s a reason why CTV advertising is getting so much attention in 2024: it provides a powerful advertising opportunity that has only increased in importance related to the demise of third-party cookies. New CTV brands will find this medium offers a great opportunity to reach desirable audiences and connect ads to business objectives. Those brands must ensure they are measuring the right things and keeping on top of emerging trends to maximize their investment.