How fast-food chain Carl’s Jr. is pushing CTV to become a performance channel

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Connected TV is maturing, taking up more and more ad dollars as advertisers look to it as a means to boost brand awareness while simultaneously driving performance.

For the last year, fast-food restaurant Carl’s Jr. has been spending more on the channel — more for performance than anything else. Over the last year, the restaurant chain has increased its CTV spend from 15% of its budget in 2023 to 20% of its budget this year. (The company did not disclose specific dollar figures.)

“Store visits is what we really want to measure as we start to view CTV as a performance channel,” said Jennifer Tate, CMO at CKE Restaurants, parent company to Carl’s Jr. “We view CTV as both important for awareness and brand messaging, but also critically important that it’s driving store visits.”

Increasingly, Carl’s Jr. is spending more on CTV and less on things like linear television, per Tate. It’s unclear how those dollars are shifting as Carl’s Jr. did not disclose specific figures. That push into CTV–again, powered by IRIS.TV–has led to 2.2X higher return on ad spend compared to other targeting methods and a 152% incremental lift in sales, according to a company spokesperson. The company also did not detail specific figures around ROAS or lift in sales.

“It used to be [that] you had to keep a certain portion of your budget in linear just to keep the scale,” she said. “But that’s not really a constraint anymore. So we will continue to move more of our budget into CTV. It absolutely has a higher return on investment for us.”

It could be said that draw of CTV is its ability to target audiences and more readily measure performance analytics, but it hasn’t been easy across an increasingly fragmented landscape. To that end, Carl’s Jr. has spent the last year or so working with multiple third parties, including its agency partner PMG and video data platform IRIS.TV, to better target household ad exposure and then try and track it back to in-store sales. The financial details of these partnerships were not disclosed. 

It’s not foolproof given the signal loss caused by data privacy initiatives, like the demise of Google’s third-party cookie, allowing “leakage in the process” leaving advertisers and their agency partners dependent on “multiple sources of truth,” said Doug Paladino, programmatic media director at PMG. Meaning, market mix modeling as well as third-party vendors and platforms are often needed to fill in the gaps to help advertisers determine how to allocate their CTV spend. 

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For example, the restaurant chain has a partnership with InMarket, a measurement and marketing company, that matches CTV ad exposure to a household to another device in that household to then see if someone in that household saw a targeted ad and then went to make a Carl’s Jr. purchase via credit card. Carl’s Jr. partners with InMarket, Innvoid, a CTV advertising and measurement platform, and uses media mix modeling to measure its CTV performance.

“That is certainly the best way for us to understand [that] this investment drove this much traffic or this many transactions, this many visits to our restaurants,” Tate said. 

Tate said Carl’s Jr. has seen the performance to justify spending more in CTV, but she did not disclose specific figures. Carl’s Jr. and its parent company aren’t alone in shelling out more ad dollars on streaming ads. As the cord-cutting trend continues, eMarketer predicts U.S. spending will reach a total of $30.10 billion this year.

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Historically, CTV has been leveraged for its scale and reach. But as the space matures, measurement is becoming a bigger talking point. There have been advancements in data and measurement, like NielsenOne or Comscore Campaign Ratings, Roku and LG ACR data, and a variety of cookie-less universal ID solutions, said Kevin Amos, partner and chief media and data officer at Brunner, an independent ad agency. 

Per Amos, these advancements can be resource-intensive. “There is also still a lot of ecosystem fragmentation and that platform diversity results in the lack of uniform standards with a hint of privacy and consumer consent concerns,” Amos added in an email.

Then there’s the fragmentation and lack of standardization. CTV is still evolving to become a viable performance media channel, reliant on a hodge podge of adtech vendors to target audiences and measure success as opposed to an industry standard.

“Some sort of standard or governing body, like the IAB [Interactive Advertising Bureau] is a group that we do rely on to help provide some gold standard of uniformity versus making it feel like it’s the wild, wild west,” said Jennifer Kohl, chief media officer at VML.

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