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Why smart TVs are the new frontline in interactive ads

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by Tim Mulligan

Yesterday Roku announced that it is partnering with Unity to serve interactive ads across Roku’s connected TV ecosystem (with 76.8 million accounts as of Q3 2023). This recognises that the traditional big screen of the TV is low hanging fruit for reaching mainstream consumers. The partnership will connect Roku’s premium TV streaming inventory to the Luna app marketing platform. Unity’s Luna platform offers advertising tools for mobile game app marketers to drive app downloads or installations. The new product, Action Ads, will enable Roku users to download games from interactive ads directly onto their mobile devices, using their Roku remote, before returning to streaming video content on the connected TV. To further simplify the process, Roku has ensured that mobile app marketers can also easily buy cross-channel media through a single platform by logging into Luna from Unity and selecting Roku from a list of marketing channels.

Smart TVs are driving digital entertainment in the connected home: With nearly two thirds of consumers now using smart TVs (source: MIDiA Research), the smart TV is easily the most used smart entertainment device in the home. Traditional TV engagement will remain the core use case, but the increasing integration of bundled D2C services will start to accelerate the linear fragmentation power of the smart TV. With linear viewing now significantly below that of binge-viewing smart TV WAUs, activity is already moving into post-linear consumption. For entertainment companies, the smart TV represents a way to drive increased engagement in the home.

Currently, less that 10% of consumers play games on their smart TVs. While Action Ads is unlikely to change this in the near term, it will increase the relevance of the smart TV and the wider connected TV ecosystem. This will begin as an engagement funnel but turn increasingly into an entertainment destination for games and other entertainment formats.

The smart TV is becoming a destination in its own right for entertainment 

The smart TV is now at the heart of the emerging connected home entertainment ecosystem. It is leading the transition from traditional home entertainment distribution towards a more decentralised and dynamic ecosystem powered by connected smart devices. The disruptive second order impacts of the smart TV extend beyond integrating third-party apps onto a TV, a dawning reality that will start to have a major impact on distribution and activation strategy for the whole digital entertainment industry in 2024 and beyond.

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