Interactive CTV ad interest ramps, QR codes not so hot

Last week Disney, Frndly TV and Plex leaders discussed connected TV advertising at the StreamTV Show in Denver, where interactivity and contextual approaches are among recent darlings but QR codes appear to have fallen out of favor for some.   

Multiple streamers and platforms have undertaken relatively recent work on new ad formats for CTV that aim to engage, capture attention, and possibly edge viewers closer to the point of transaction. But while digitally-delivered TV and new tech advances bring opportunity to test out new methods for targeting and types of ad units – including those that can push consumers further down the purchase funnel or prompt a conversion – companies are still experimenting to see what exactly works and will resonate with consumers and brands alike.

Ad sales executives from Disney, Plex and Frndly TV weighed in on the topic of shoppable and interactive ads during a panel focused on CTV ad targeting moderated by Brett Sappington, founder and principal analyst at Sappington Media.

Speaking at the session Todd Hay, VP of revenue & engagement at streaming video platform Plex, cited seeing more and more excitement and interest in shoppable and interactive ads and capabilities, but said the area is still a learning ground. One where QR codes have a role, but where Hay believes TV device platform players are one source of friction.

“QR codes is a really fascinating stepchild [of shoppable TV] they’re really easy, they’re really cheap to produce,” he said. However, “they’re really difficult in terms of what each platform allows us to do, and the agreements we have with platforms changes constantly.”

According to Hay, six months ago there were CTV platforms that wouldn’t have allowed QR codes but now do, and on the flip side others that removed the capability.

The interactivity on a TV screen aspect of shoppable ads is something both Plex and the industry are “still trying to figure out,” Hay commented, attributing this to the device or TV makers themselves want to control it.  “And they’re trying to figure out how they can maintain control over something that will very quickly not be controllable by the device.”

Steve Sklar, VP of advertising & monetization at Frndly TV, was not particularly keen on QR codes. Frndly has had the ability to do QR codes for quite a while now but “haven’t seen a whole lot of demand,” he said.

It has seen some. For example, Frndly set up a pop-up holiday channel with an advertiser, with the ability to intersperse QR codes to expose a special offer – which was a requirement of the deal. Still, he said Frndly is “not seeing too many opportunities in the space” for QR code formats.

And while indicating QR codes may no longer be the tech du jour, Lily Panchasarp, director of sales at Disney Ads, thinks the “interactivity of ads is going to continue to always rise.”  

Panchasarp, who leads the programmatic sales team at Disney, noted frequency of ad inquiries about innovative formats and pointed to the company’s recent rollout of advergaming formats with partner BrightLine on certain properties like ESPN. Earlier this year, Disney introduced a shoppable beta program, along with AI-powered contextual advertising tools.

Hay, meanwhile, said interactive formats start to force multiple surfaces, where it can do home screen takeovers with sponsored content hubs, or second-screen experiences done in ways other than QR codes that people don’t necessarily want to put on screen.

“But if you can click the [TV remote] button and have something show up on the phone, I think that’s the place we’re hearing people start to talk about it, but I haven’t seen the implementations yet,” he said. “We’re all probably building it ourselves and waiting for the market.”

Panchasarp also pegged interactive ads as being on top now, while pointing to earlier formats like binge ads and pause ads, where the aim is still attention and engagement.

Asked by Sappington how engaged viewers actually are with new interactive ad formats the Disney executive said for her, “surprisingly, more than you’d think.” That’s why Disney continues to build partnerships with likes of KERV Interactive or BrightLine, as case studies have shown success around mid-funnel reach and driving into conversions.

“It is working for some advertisers and they continue to come back,” Panchasarp said of interactive ad formats.

Related to new formats, panelists discussed another hot topic at the show – contextual advertising. It’s one where panelists agreed the emerging tactic, which promises to help avoid some privacy concerns, can be somewhat confusing as there are various aspects or definitions. But in general, it aims to align brand messaging or ads with the moment – be it the content, mood, time of day, or device (check back soon for key StreamTV Show takeaways on contextual advertising).

To help advertisers more easily contextually target based on content and buy there have been efforts like the CTV contextual PMP deal library from IRIS.TV, which leverages multiple data and technology partners to create deal segments based on mood, genre, emotion or other contextual elements of content.   

In terms of running ads alongside content, Sklar noted that in addition to not always getting the desired content data, some implementations of new or contextual ad formats can be difficult as a distributor as content rights holders, particularly big brands like Disney, may block access – meaning they don’t want to overlay content such as having an L-bar ad appear during programming.

Hay echoed a similar sentiment, saying a year ago, he would’ve called it a complete block, “that not one company’s going to let us touch the screen.”

But with those kinds of contextual ads, which people see as additional sources of revenue “when you can make it germane to the content where they cannot be a complete distraction, that’s great, I think that becomes valuable,” Hay said. “But it is still something we have to work through every deal that we want to do it on, we have to revisit the deal with the content partner, so that makes it hard.”

From the Disney content-owner side, Panschasarp said the company always cares about the content and may be particular but noted a lot of change in the past year and in those ahead. She mentioned interoperability with tech partners, while acknowledging it may not yet allow for the level of ad control that partners on the distributor side would like.

“But I think we are trying to be more agile, it’s where the marketplace moves and how fast can we adapt to it,” she said.

As mentioned, Disney’s leaned into using AI and metadata to analyze and identify the emotion conveyed on screen (known as Disney Magic Words), which then can help the ad creative to match or brand to target to that emotional or topical relevance (say serving an ad for cookware that runs during episodes of Hulu’s new season of “The Bear”).

Asked about what kind of incremental lift results for advertisers’ panelists have seen by using contextual signals gleaned from technologies that capture objects and emotions in-scene, executives again suggested it’s still the start of the game. Disney’s contextual ad tech pilot is still being used in beta, but Panscharsarp reminded the audience that the media giant is also an advertiser itself for its different lines of business, where it takes learnings from across the company.

“We learn from each other and what’s working and we’ve seen success with it,” she said of using contextual signals pulled from content, expressing hopefulness of coming back next year with more positive findings.  

Hay acknowledged that most of Plex’s experimentation with contextual content signals so far has been on its own platform to drive engagement by building related content clusters – rather than through advertising.

On the native and premium ad side, “it is a place where we do see decent pick up, but it’s early days for us,” he said.