While advertisers are recognizing CTV’s ability to reach their desired audience, modern television is multi-channel. Successful TV advertising campaigns require strategic budget allocation across both linear and streaming channels – the key is finding the optimal balance between the two. Advertisers need actionable insights into viewership across the TV landscape to achieve this balance.

As viewing habits change, linear television becomes CTV

“The Rule of 40,” first released in 2021, called for investing 40% of TV budgets in CTV to effectively reach audiences given viewer behavior at the time. Fast forward to 2024, and viewing behavior has changed even further. According to Samsung’s proprietary data, 63% of smart TV viewers spend more time watching streaming content than linear TV. These viewers use streaming as their primary viewing source—many don’t consume linear TV at all. Now that streaming content is no longer primarily ad-free, strategies must change.

Samsung Ads has evolved its Rule of 40 report to help advertisers reach this growing number of streaming-oriented viewers. Samsung Ads used its proprietary Automated Content Recognition (ACR) data, which identifies all content and ads broadcast on linear TV, to understand the ability of linear ads to reach streaming-oriented viewers.

Using advertising campaigns from multiple industries, the team created a reach curve by analyzing the delivery of linear ads to streaming-oriented viewers.

Even the largest linear advertising campaigns only reach 17% of the streaming-centric audience (a campaign with 1,000 linear gross rating points (GRPs) would reach 16.6% of streaming-centric viewers). This means linear advertising campaigns cannot reach 52% of the entire TV universe. Therefore, it is time for marketers to rethink their approach to TV advertising. The paradigm has shifted: Linear is now incremental to CTV.

With the growth of ad-supported streaming, marketers can now reach most streamers with their advertising – both streaming-centric viewers and viewers who use streaming as a supplement to their linear TV viewing. Internal data from Samsung Ads shows that ad-free TV viewing has declined every quarter over the past year and ad-supported streaming now accounts for nearly two-thirds of streaming time.

The power of CTV is unattainable

To make a meaningful business impact, it’s important to start with streaming and CTV and fully leverage its capabilities as a powerful tool for driving results. CTV does more than just increase reach – it changes the way advertisers connect with their desired audiences. With dynamic, interactive ad formats, advertisers can instantly engage viewers and inspire action on the biggest screen in the home. CTV opens up new optimization, measurement and attribution opportunities, ensuring ads are seen and effective.

While the “Rule of 40” has been a useful guiding light for advertisers, it can no longer be just a suggestion. It’s time to rethink the long-held assumption that linear TV budgets should dictate allocation. For the modern multichannel TV experience, TV advertisers are making CTV the foundation of their strategy for efficient and effective reach, and integrating linear TV to reach the additional viewers that remain there.

Sponsored by Samsung Ads