The news: Roku unveiled new tools that could help move the needle for advertisers looking to more closely align connected TV (CTV) ad spend with business goals.

The CTV streaming platform introduced two optimization solutions as part of the Roku Outcomes suite:

• Roku Outcomes Actions optimizes ad delivery based on conversions defined by advertisers, such as app installs, first-time views, and sign-ups. It’s available for media and entertainment advertisers only, with plans for expansion, per a press release.
• Roku Outcomes Amplify optimizes delivery based on maximizing incremental household reach. Advertisers set the target audiences and frequency controls.

Why this matters: Roku is focusing on the two most important considerations for US CTV media buyers when they evaluate inventory—audience quality and performance outcomes, per Verve and EMARKETER.

Key to this offering is Roku’s closed-loop measurement. Advertisers can run placements—including on the home screen or in-stream—and Roku will know when those ads convert viewers, such as by tracking whether they install an app on the platform or follow the ad into different streaming content.

However, it will be tricky for Roku to apply this measurement to non-entertainment brands as it expands Outcomes to additional advertiser categories and types of conversions, such as purchases and website visits. Those ads may point viewers to destinations beyond the platform, where Roku loses access to tracking.

Implications for advertisers: Streaming players are turning their attention to outcomes-based advertising, which could offer compelling reasons for increasing ad spend on the channel. Targeting is also becoming more granular, giving advertisers the ability to reach precise audiences and then determine whether those ads drove lower-funnel KPIs.

It will be up to advertisers to decide the right metrics to measure—a conversion can mean different things to various brands. If advertisers focus on the wrong KPIs, their spend will be wasted. The strategy will be to base conversions on actions that don’t ask too much of viewers, such as a one-question survey, so they can quickly get back to the content they came to watch.

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