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May, 2024

Samsung Ads and Nielsen study proposes ‘Rule of 30’ for optimised TV ad spend

A new study by Samsung Ads and Nielsen suggests advertisers could optimise their reach and efficiencies by allocating 30% of their Total TV budget to ad-funded streaming.

The study, titled ‘Behind the Screens’, demonstrates how a 70/30 combination of linear and streaming ads can deliver greater impact among key demographics without increasing budgets.

Over 8.6 million Australians watch video via Connected TV (CTV) daily, according to the IAB. The study introduces the ‘Rule of 30’ as a guideline for advertisers uncertain about how much of their Total TV budget should be allocated to ad-supported streaming on CTV.

The study modelled the effects of different TV advertising budget allocations across linear and streaming, using a broad 18-54 year old demographic and a maximum campaign spend of $2 million.

Campaigns produced a higher net reach when 30% of the budget was allocated to ad-funded streaming and 70% to linear TV ads. The caveat is optimal allocation will vary across industries, audience preferences, campaign objectives and budgets.

According to the report, Ad-funded streaming reaches audiences under 40 years old at 3+ reach with ad-funded streaming compared to linear TV ads, with any budget of $1.3 million or less. For advertisers on smaller budgets – $800K or less – over half of their budget (55%) should be allocated to streaming for maximum impact.

Ad-funded streaming can provide the same reach as linear TV ads amongst the 25-54 year old demographic for campaigns with lower budgets.

For budgets over $350,000, linear TV ads alone still provide a higher reach compared to ad-funded streaming.

Over two thirds of all time spent on Samsung Smart TVs is within streaming environments. Yet despite the shift to streaming, advertising dollars have been slow to catch up, with just a single digit percentage of the $3.4B invested in Australian TV advertising last year making its way to streaming, the report said. In more mature markets like the US or UK, CTV ad spends are 29% and 21%, respectively.

“To achieve success in today’s TV landscape you have to reach audiences where they choose to watch – TV spend is playing a game of catch up,” Samsung Ads Managing Director, ANZ & SEA, Alex Spurzem, said. “What the study shows is that by rebalancing budget allocation, advertisers can optimise their reach, without needing so much as one additional dollar.”

Head of Publishers and Platforms, Nielsen, Kirsten Riolo, said engaging specific audiences while striking the balance of reach and frequency is a challenge facing every marketer.

“What’s evident in this study is that combining linear and streaming ads in a TV campaign can be key in reaching main demographics across all categories. The Rule of 30 isn’t designed to be a one-size-fits-all: rather a supporting guide for those in search of even bigger impact,” she said.

“The Rule of 30 isn’t designed to be a one-size-fits-all: rather a supporting guide for those in search of even bigger impact.”