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Catherine Sullivan is the U.S. CEO of Omnicom media agency PHD. Here she describes how she and her agency advise clients on how to approach the fast-growing connected TV market.

The way we watch video has changed. Viewers, not networks, are choosing what appears on their television screens. For me, that means catching up on clips from my favorite late-night shows before squeezing in a quick guided workout. Those are two very different pieces of content — both meeting my personal needs at the right moment for me. Why would I go back to linear TV? Why would anyone?

The following shows how PHD is guiding clients through the connected TV landscape, as well as some insight into how the space is redefining our viewing habits. It also covers what we tell them about the way brands should approach these evolving market trends.

Here are 3 things to know about connected TV. 1. Connected TV is redefining television. 2. Streaming platforms are the primary destination for video. 3. Digital platforms offer brands new ways to drive growth.

Connected TV is redefining television

We’re witnessing the biggest shift in viewership in a generation. In 2020, streaming households eclipsed pay-TV households for the first time. Connected TV is a major factor driving this evolution, offering viewers the same level of choice and control on their television screens as they have grown accustomed to on their tablets and phones. This is not a year to take incremental or baby steps when it comes to how you’re going to spend your money on media. If you don’t take that massive leap forward and invest in streaming, you could be left 10 years behind.

A Wi-Fi symbol hovers over a television. In Australia, over 25% of logged-in YouTube CTV viewers watch content almost exclusively on TV screens.

People have changed the way they think about streaming and the way they define television. According to new research from Talk Shoppe, 60% of people now say their definition of TV includes streaming services such as YouTube.1 To many viewers, television no longer means something that’s slickly produced. Nearly 3 in 4 viewers describe good content as something that’s personal and relevant.2

When people are choosing what to watch, they’re just as likely to check in on their favorite YouTube creator as they are to embark on the latest network series. I tell my clients that they need to start looking at audiences — not only who they are, but what their preferences are — and go where the growth is.

Streaming platforms are the primary destination for video

At its best, watching television is a communal activity. During my more than two decades in network TV sales, this was always a linchpin of our pitch to agencies and brands. In fact, it gave rise to its own cultural phenomenon: the watercooler effect. The phrase encapsulates how the desire to share a great content experience has a second life outside of the actual viewing environment.

We want to consume content that speaks to us personally, but we also want to share it with others. Connected TV allows us to do both by creating personalized viewing schedules to watch with friends and family. Just as the desire for choice and control led people to move from networks to streaming platforms, the desire for community is driving a shift from phone and tablet viewing back to the TV screen.

By turning it into a shared experience, connected TV has changed the way people think about streaming. According to Talk Shoppe, 57% of Americans choose to watch YouTube on TVs with others — and 79% achieve deeper connections when doing so.3

People now incorporate streaming video into their lives in the same way they did with linear television. Seventy-five percent of those who watch YouTube with others have built a routine around their viewing.4 At PHD, we emphasize to our clients how people are spending their days because you need to be seamlessly integrated into that routine to stay relevant.

Three people sit on a couch together watching television. 8 in 10 viewers in Vietnam agree that YouTube fosters deeper connections among co-viewers.

Digital platforms offer brands new ways to drive growth

What does this mean for brands? Just as viewers have more choices than ever, the possibilities offered by streaming can seem overwhelming. In truth, a few stats illuminate the most compelling advertising opportunities. Five apps account for 80% of all connected TV viewing, of which only two sell ads. YouTube is the clear leader among ad-supported streaming platforms, accounting for 40% of watch time in the U.S.

By harnessing the power of YouTube on connected TV, brands can achieve the same reach they get from linear television, with multiple added benefits. Those include personalizing ads at scale, using video ad sequencing to tell powerful stories, and driving action with interactive features. The way we watch video has changed. The way we engage customers should change too.