What Is Connected TV Advertising? A Guide to All Things CTV

As advertisers, we’re always chasing that sweet spot where reach, precision, and measurable results collide. Connected TV (CTV) advertising hits all three, combining the vast audience of traditional TV with the laser-focused targeting and analytics of digital marketing. 

With holiday streaming viewership spiking by over 20% and consumers cutting the cord in record numbers, now is the perfect time to dive into CTV advertising. Whether you’re a seasoned marketer or a curious beginner, this guide will walk you through everything you need to know about this game-changing medium.

What Is Connected TV (CTV)?

Connected TV refers to any television that connects to the internet and streams digital video content. This includes Smart TVs, which have built-in streaming apps like Netflix and Hulu, and regular TVs connected to streaming devices such as Roku, Amazon Fire Stick, or gaming consoles like PlayStation and Xbox.

What sets CTV apart is its ability to integrate internet-based streaming with the traditional TV experience. It allows viewers to watch their favorite shows, movies, and live events on demand—no more flipping through channels and hoping something good is on.

For advertisers, this means an incredible opportunity to get in front of engaged audiences during their prime viewing moments.

CTV vs. OTT vs. Linear TV

Before diving further into CTV, let’s clear up some common confusion:

• CTV (Connected TV): Refers to the device itself—Smart TVs or traditional TVs connected via internet-enabled devices.
• OTT (Over-the-Top): The method of delivering video content over the internet, bypassing traditional cable or satellite providers. OTT is the content delivery; CTV is the hardware.
• Linear TV: The old-school TV experience, where you watch scheduled programs on specific channels.

Why does this distinction matter? Because CTV advertising focuses on where people watch (the device), while OTT advertising focuses on how people watch (the content delivery method).

Unlike linear TV, CTV and OTT provide on-demand viewing, which offers greater flexibility for viewers and greater opportunities for advertisers to get creative with their messaging.

Market Trends: Why CTV Is Taking Over

The rise of CTV is closely tied to the phenomenon of cord-cutting—consumers ditching traditional cable or satellite TV in favor of streaming services. In 2022, streaming made up 30% of all TV viewing time, and that number continues to grow.

Why are people cutting the cord? Flexibility and cost. Viewers can watch what they want, when they want, and often for a fraction of the price of traditional cable.

For advertisers, this shift is monumental. CTV advertising is projected to surpass $27 billion by 2025. Streaming services like Hulu, Peacock, and YouTube TV have created premium ad inventory that allows advertisers to reach audiences who have moved away from traditional TV.

Plus, the holiday season is a prime time for streaming. Streaming viewership spikes by over 20% during the holidays as families gather around their TVs for movies, shows, and seasonal specials.

How CTV Advertising Works

There are two primary ways to purchase ad space on Connected TV platforms:

1. Direct Buying

This method involves negotiating ad placements directly with streaming platforms or publishers. You can secure premium ad inventory at fixed prices, ensuring your brand is featured during high-demand times or on specific shows.

The advantage of direct buying is control. You know exactly where your ads will run and when. The downside? It can be time-consuming and often comes with a higher price tag.

2. Programmatic Buying

Programmatic buying automates the process using real-time bidding. Advertisers bid on ad slots, and the highest bidder gets the placement. This approach is fast, efficient, and scalable, making it ideal for brands looking to optimize their campaigns on the fly.

With programmatic buying, you can also target audiences based on their behaviors, preferences, and locations, ensuring your ads reach the right people.

Why Advertisers Love CTV

1. Precision Targeting

CTV leverages data to target viewers with precision. You can use first- and third-party data to reach specific demographics, interests, and even behaviors. Want to target millennials who love cooking shows? Done.

2. Unskippable Ads

We’ve all hit the “Skip Ad” button on YouTube. With CTV, that’s not an option. Your ads are unskippable, meaning your message is guaranteed to be seen in its entirety.

3. Measurable Results

CTV ads come with built-in analytics. You can track metrics like impressions, click-through rates, and conversions, giving you a clear picture of your campaign’s Return on Ad Spend (ROAS).

For example, if viewers make a purchase after seeing your ad, you’ll know—and you can use that data to optimize future campaigns.

Challenges of CTV Advertising (and How to Overcome Them)

1. Fragmentation

The CTV landscape is vast, with countless streaming platforms and devices. Managing campaigns across all these options can be daunting.

Solution: Work with platforms or agencies that centralize your efforts, simplifying campaign management and reporting.

2. Creative Demands

CTV ads need to be short, engaging, and visually compelling. This can be a challenge if your brand doesn’t have video content ready to go.

Solution: Partner with creative agencies (like us!) to develop high-quality, scroll-stopping video ads.

FAQ: Your CTV Questions Answered

1. How is CTV different from traditional TV advertising?

CTV combines the broad reach of TV with the targeting and analytics of digital marketing. Traditional TV ads reach everyone watching a program, while CTV ads target specific audiences based on data.

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2. What kind of businesses benefit from CTV advertising?

Any business looking to reach a highly engaged audience can benefit. From e-commerce brands to local businesses, CTV offers unmatched flexibility and ROI.

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3. What’s the ideal length for a CTV ad?

Typically, CTV ads are 15-30 seconds long. They need to grab attention quickly and deliver a clear, compelling message.

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4. Can small businesses afford CTV advertising?

Absolutely! Programmatic buying and flexible budgets make CTV accessible to businesses of all sizes. Plus, with measurable ROI, it’s easier to justify the spend.

Ready to Make Your CTV Debut?

There’s never been a better time to dive into Connected TV advertising. With holiday streaming viewership spiking by over 20%, your audience is spending more time than ever on platforms like Hulu, ESPN, and YouTube TV. Combine that with the growing trend of cord-cutting and the projected $27 billion CTV ad market by 2025, and you’ve got an unmissable opportunity to put your brand front and center.

Plus, with advanced targeting, unskippable ads, and measurable ROI, CTV offers the perfect blend of reach and precision to make your campaigns truly impactful.

Let’s create something unforgettable. Reach out today, and we’ll help you craft a strategy, develop standout creative, and launch your campaign to make this holiday season your most successful yet.

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