Samsung explains why 40% of TV ad budgets should go to streaming

As streaming keeps growing and accounting for more time spent viewing, Samsung Ads is recommending a big shift to ensure advertisers keep reaching their desired audiences.

Justin Evans, global head of analytics and insights at Samsung Ads, kicked off the StreamTV Ad Summit today and said that advertisers need to start dedicating 40% of their TV advertising budgets to streaming.

“It’s time to rebalance TV budgets,” he said while admitting that 40% is a big number. “Based on our analysis, currently 14% of TV budgets are allocated to streaming. We’re recommending a much larger allocation.”

Samsung Ads said there’s a split between linear-only homes and streaming-enabled homes and that streaming-enabled homes not only make up the majority of the ecosystem but also still watch a substantial amount of linear. On the other side, linear-only homes—or households without smart TVs or connected devices—is a much smaller group.

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Evans said the imbalance in the split between these homes means that linear-only homes absorb too many linear impressions and over index for ad delivery within linear-only media plans. “The streaming-only homes are going to be starved for impressions. They’re going to under index.”

Samsung Ads researched how both groups can come into balance and receive their fair share of impressions and that’s how it came up with the 40% figure. As an example, with a 100% linear TV buy, linear-only homes get nearly two times the intended amount of impressions.

“And the streaming-enabled homes are, in fact, being starved. They’re eight points short of reaching their intended impression target. Remember, that the streaming-enabled homes is a much larger group and, by the way, it’s a growing group. That’s not the group you want to shortchange with your advertising delivery,” he said.