The 2023 streaming TV advertising trends to watch

Updated on January 12, 2023 | By Matt Miller, Sr. Content and Editorial Manager

Video Streaming

Danilo Tauro, the product leader for Streaming TV AdTech at Amazon Ads, believes in the power of storytelling, especially through video.

“Advertising reaches so many audiences, and long-form videos are very impactful and have the power to inspire consumers,” Tauro says. Streaming, in particular, he explains, offers brands the opportunity to find creative ways to connect with consumers and share meaningful messages. Whether it’s through interactive ads or other cutting-edge video advertising solutions, Tauro is excited about what the future of streaming TV has in store for brands.

And looking ahead to 2023 and beyond, when streaming TV ad spend is expected to reach $34 billion in 2025,1 Tauro shares his recommended tips for brands on how they can use Amazon Ads solutions to tell meaningful stories and connect with consumers.

To start out, tell me a little bit about your career, what brought you to Amazon, and your role here.

I started to work in media and advertising almost 10 years ago at Procter & Gamble [P&G]—first in a European, then in a global capacity. My role was to connect, integrate, and synchronize P&G brands with adtech and marketing tech solutions. I decided to join Amazon Ads to bring my previous buy-side experience to help build a customer-focused connected TV [CTV] adtech product. In my role, I lead the global Streaming TV AdTech product roadmap and go-to-market strategy, to make sure we combine Amazon Ads solutions in ways that solve advertisers’ problems in new, innovative ways.

Before we look ahead to where streaming is going, can you share some of the trends you saw in 2022? How did viewing habits shift in 2022, and what new strategies were brands using to reach viewers?

Over the past year, it has become increasingly clear to me that nearly all content is moving toward some version of a streaming model. Here is what I think is driving this:

  • Consumers: Video on demand [VOD] expectations are contributing to driving cord-cutting [consumers can decide what, when, and how they want to watch]
  • Technology: As technology in streaming has improved, the experience of watching sports is now better [previously, small delays impacted consumer experience]
  • Advertisers/media: Large and influential TV buyers have started to rethink the upfront [the period when TV networks, CTV, and streaming services pitch their programming and ad products to advertisers and agencies] as they look for more flexibility
  • Advertisers/brands: CTV inspires new ad creativity [interactive, dynamic creatives, etc.]

If we look at linear TV budgets as a percentage of total video advertising budgets in the US, according to Statista, it made up 71% in 2020, 62% in 2021, 57% in 2022.2 At the same time, ad spend is increasing fast for CTV. According to Statista, it grew about 600% in the last five years, and is expected to be $19 billion this year and $34 billion in 2025.3 At current growth/decline rates, by 2025, linear TV and CTV will have about the same budgets. I’d bet publishers’ strategies and adjacent tech dynamics—e.g., 5G and augmented reality—will accelerate these changes.

What does this mean for brands? It would be beneficial for them to start testing and exploring CTV and all the corresponding opportunities, mostly connected to programmatic buying, audiences, measurement, full-funnel optimization, new creative formats, etc.

There are so many streaming options for consumers out there. How can advertisers manage their campaigns and maximize their performance across these streaming publishers? How can Amazon Streaming TV [STV] ads help brands build awareness and reach wider audiences?

I think you’re touching on a very important point that is “fragmentation.” Often, brands think of fragmentation of apps. But CTV is fragmented also from an “operating system” standpoint. While mobile and desktop have two main operating systems, CTV has 8 to 10 different operating systems. This complicates things when it comes to measurement.

Amazon Ads can help advertisers buy via programmatic guaranteed and private marketplace deals and reach audiences across our media properties, like exclusive inventory in Freevee and Twitch, with direct integration with premium 3P [third-party] publishers—with Amazon Publisher Direct, which also provides exclusive inventory from these 3P publishers—along with integrations with 3P exchanges like Freewheel or AdX. In addition, we can offer opportunities to connect with audiences, from age range [18+] and gender at scale via modeled audiences—for upper-funnel, brand-building campaigns—to more curated Amazon audiences based on shopping insights—for lower-funnel, performance marketing campaigns.

Advertisers previously had to manage top- and bottom-funnel campaigns separately: different teams, agencies, KPIs, and tech solutions. Now they can consolidate all their STV spend with Amazon Ads. In the last 12 months, we’ve done a lot of work to develop brand-building and upper-funnel solutions so that we can help advertisers across the full funnel. A lot of that work has been dedicated to helping advertisers reach audiences at scale. There is a lot of research and case studies that confirm the importance of reach. That’s why Amazon Ads has built solutions that help reach consumers across 3P STV media publishers as well. In addition, solutions like Amazon Marketing Cloud [AMC, clean room technology from Amazon Ads] help them measure against unique insights, to help improve planning, buying, and optimization.

One thing I’m really curious about is how small businesses can use streaming solutions. I think there’s a perception that streaming is expensive and exclusively for massive brands. But how can small and medium businesses use streaming to grow their audiences? What tools are available to them?

It is definitely true that large advertisers drive most of the STV budgets. But Amazon Ads Streaming TV solutions enable and support “performance STV.” Smaller advertisers can buy Streaming TV ads and optimize for ROAS [return on ad spend], find their first-party audiences, understand what channels drive more sales, and so on.

In this current uncertain economy, I know a lot of brands are really working to ensure that their budgets are being used in the most efficient way possible. What are some ways that brands can maximize their ad spend on streaming and CTV? And how can they continue to make these connections with consumers during this time?

The popular saying among advertisers is “50¢ out of every dollar I spent for advertising was wasted, but I could never be sure which 50¢ it was.” In this current economy, the scrutiny on budgets has become much stronger. Linear TV ad spend is down, and that’s in part because it is difficult to measure.4 This is actually another factor that is accelerating the growth of CTV, which by definition brings together the best of two worlds: the reach and effectiveness of big TV screens, and the measurability of digital.

Going into 2023, what are your predictions ahead for streaming and CTV? What trends do you see on the horizon, and what can brands do to prepare in the coming year?

Somebody once said, “It’s tough to make predictions, especially about the future.” While predictions are difficult, brands should closely experiment with clean rooms. They enable more control and flexibility for advertisers across planning, insights, and measurement analysis, via privacy-centric technology that is particularly useful given ad addressability changes.

From sports to interactive ads, there are so many cool ways for brands to creatively connect with audiences through streaming. What are some products you’re really excited about, and how can brands effectively use these solutions to reach consumers?

One area I’m very excited about is creativity—streaming TV opens up many new opportunities to drive creative assets, innovation, and/or customization. The opportunities are endless, as brands want to reach audiences with the right creatives, at the right time, in the right moment, with the right frequency. Creative assets can also become a way to engage consumers and drive actions—e.g., add to cart—or help them learn more, e.g., via QR codes. Interactive ads can change the relationship between consumers and brands.

Since you’re our streaming guy, can we close this out with you telling me what ads you’ve seen recently that have been particularly impactful?

As the streaming TV guy, I truly believe in the power of storytelling. Advertising reaches so many audiences, and long-form videos are very impactful and have the power to inspire consumers. I really applaud brands that are focusing on advertising as a force for good. They invest media dollars to drive very impactful video ads, mostly on streaming, that pass very powerful messages, taking a stand and supporting important causes like gender equality, Black Lives Matter, or LGBTQ+ rights.

1 Statista, Connected TV ad spend in the US, October 2022
2 Statista, Linear TV ad spend in the US, October 2022
3 Statista, Connected TV ad spend in the US, October 2022
4 Insider Intelligence, April 2022