APAC CTV adspend drops 41%, as Roku dominates the US

Programmatic ads on connected TV are soaring in North America and EMEA, but stagnating across Asia. Yet the arrival of closed premium networks on Netflix and Disney+ is heralding a two-tier ad ecosystem...

Adspend reports for 2022 show that connected TV (CTV) spend is predictably growing, as streaming services are on the rise and advertisers realise the potential of CTV’s highly engaged audience.

Global open programmatic CTV ad spend grew 31% year-on-year (YoY) – quadrupling in three years – but APAC is lagging, singled out as the only region where adspend is dropping.

CTV privacy platform Pixalate analysed programmatic ad activity across 300 million Connected TV devices and over 70,000 programmatic-supported CTV apps. Pixalate's datasets consist predominantly of buy-side open auction programmatic traffic sources. 

“Varying levels of maturity in CTV advertising”

“It’s important to view Pixelate’s study through a regional lens, to better understand the findings and their relevance to each market,” commented James Collins, Senior Vice President, Media Network at Rakuten Advertising. “There are major differences between the US and ‘emerging markets’, like EMEA and APAC, due to varying levels of maturity in CTV advertising.” 

Most notably, 94% of U.S. households are reachable via open programmatic CTV ads, up from 86% in 2021.

“The nuances of each market make it difficult to compare and contrast levels of ad spend,” Collins continued. “For instance, the study focuses on ‘open programmatic spend’, also known as open market transactions, which, whilst a trusted and scaled way of buying in the US, remains nascent elsewhere.

“Take EMEA, for example: the 816% YoY growth here should be interpreted against the backdrop of starting from near zero in 2021. Open programmatic spend still only represents a single digit percentage of overall ad spend on CTV in EMEA.

“Growing trend of ad partnerships with CTV platforms”

“Another interesting take away from the study is the difference between platforms in terms of open market spend. This reflects the growing trend of building ad partnerships with CTV platforms, where inventory is either bought in up-fronts or by partners who have brand partnerships. 

“To this end, brands such as LG, Sony, Microsoft have their own sales teams who enable most of their inventory to be sold outside of the open market. One outlier is Roku, which has put the infrastructure in place in the US to provide programmatic competition on the open market.

“When looking towards the future, one dynamic that’s likely to change from this study is the overall percentage of open market spend on CTV,” concluded Collins. “New players in the market, such as Netflix and Disney, will be less likely to access open market demand, instead preferring to close off their inventory to anyone but trusted, high value brands. For them, these are the brands that are willing to make long-term commitments and provide a reliable source of ad revenue.”