Linear television’s cost per session is roughly 20%-30% lower than that for streaming, Rigas estimates. Streaming offers better targeting than linear, but the savings and reach of linear ameliorate those differences, he said.
Linear, by its unsophisticated targeting, is reaching people that algorithms wouldn’t touch
Ankur Goyal, vp of growth, Coterie
Not all buyers find that linear TV is always cheaper.
At performance media ad-buying company Icon Media Direct, CTV is sometimes cheaper than linear TV, but it depends on the time of day, said Nancy Lazkani, the company’s CEO.
For Michael Lisovetsky, co-founder of digital agency Juice, the same quality placement is typically more expensive on linear TV than streaming, though linear buys can be more cost-effective by buying remnant and lower-quality inventory.
“A lot of clients end up investing more in linear if it works, and they bundle their streaming spend into their digital budget,” he said.
Regardless of price, linear can reach people CTV cannot, Coterie’s Goyal said.
“My logic is that CTV and Meta are using similar signals to identify people in-market, with Meta having a huge edge in its sophistication,” Goyal said, adding that linear outperforms CTV in terms of incrementality and first-touch cost per action. “Linear, by its unsophisticated targeting, is reaching people that those algorithms wouldn’t touch.”
DTC diversifying earlier
Some digitally-native brands’ unlikely embrace of linear television was not a foregone conclusion, previously only reserved for blockbuster DTC successes like luggage brand Away or sneaker firm Allbirds.
“[TV] wasn’t even in the [DTC] conversation,” Lisovetsky said. “The biggest difference is the threshold at which people pursue TV,” he added, noting brands now start to diversify outside of platforms like Meta and TikTok after reaching a few million in revenue.
Of course, for all the benefits of linear, CTV is still growing faster with both advertisers and users.
“Long term, only having a linear TV capability is a strategic weakness,” Goyal said. “We’re going to need to crack CTV at some point. But it seems like the order of operations for us at least is cracking linear TV first and then moving to CTV, versus the other way around.”
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