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 (CTV) is any television that connects to the internet to stream digital video content. This includes Smart TVs with built-in streaming apps like Netflix and Hulu, plus 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:

Connected TV (CTV) Definition

CTV refers to the device itself—Smart TVs or traditional TVs connected via internet-enabled devices. This is the hardware that enables internet-based streaming.

Over-the-Top (OTT) Definition

OTT is the method of delivering video content over the internet, bypassing traditional cable or satellite providers. OTT is the content delivery system, while CTV is the hardware that receives it.

Linear TV Definition

Linear TV represents the traditional TV experience where viewers watch scheduled programs on specific channels at predetermined times.

Why These Distinctions Matter for Advertisers

This distinction matters 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

CTV advertising is projected to surpass $27 billion by 2025, driven by the massive shift toward streaming. In 2022, streaming made up 30% of all TV viewing time, and that number continues to grow as consumers ditch traditional cable in favor of more flexible viewing options.

The Cord-Cutting Revolution

The rise of CTV is closely tied to cord-cutting—consumers abandoning traditional cable or satellite TV for streaming services. Why are people making this switch? Flexibility and cost. Viewers can watch what they want, when they want, often for a fraction of traditional cable prices.

Seasonal Viewing Spikes

Holiday streaming viewership spikes by over 20% as families gather around their TVs for movies, shows, and seasonal specials. This creates prime opportunities for advertisers during peak engagement periods.

For advertisers, this shift is monumental. Streaming services like Hulu, Peacock, and YouTube TV have created premium ad inventory that allows brands to reach audiences who have moved away from traditional TV.

How CTV Advertising Works

There are two primary methods for purchasing CTV ad inventory, each with distinct advantages depending on your campaign goals and budget requirements.

1. Direct Buying

Direct buying involves negotiating ad placements directly with streaming platforms or publishers. This hands-on approach allows you to secure premium ad inventory at fixed prices, ensuring your brand appears during high-demand time slots or within specific premium content.

Advantages: Complete control over ad placement and timing, guaranteed premium inventory access, predictable costs.

Best for: Brands with larger budgets seeking premium placements during marquee content or seasonal campaigns.

The trade-off? Direct buying requires more time investment and typically comes with higher minimum spend requirements.

2. Programmatic Buying

Programmatic buying automates the ad purchasing process through real-time bidding systems. Advertisers set parameters and bid on ad slots automatically, with the highest bidder securing each placement. This approach delivers speed, efficiency, and scalability for brands looking to optimize campaigns in real-time.

Advantages: Automated optimization, lower minimum spends, advanced audience targeting, real-time campaign adjustments.

Best for: Performance-focused campaigns, smaller budgets, or brands requiring flexible, data-driven optimization.

With programmatic buying, you can target audiences based on their viewing behaviors, demographic profiles, and geographic locations, ensuring your ads reach precisely the right viewers at optimal moments.

Why Advertisers Love CTV

1. Precision Targeting

CTV leverages first- and third-party data to target viewers with surgical precision. You can reach specific demographics, interests, and behaviors that traditional TV simply can't match. Want to target millennials who love cooking shows? CTV makes it possible to find and engage exactly that audience segment.

2. Unskippable Ads

Unlike digital video platforms, CTV ads are completely unskippable. We've all hit the "Skip Ad" button on YouTube, but with CTV, that option doesn't exist. Your message is guaranteed to be seen in its entirety, ensuring maximum brand exposure and message retention.

3. Measurable Results

CTV ads provide comprehensive analytics that traditional TV advertising lacks. You can track detailed 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 exactly which creative drove that conversion—and you can use that data to optimize future campaigns for even better performance.

Challenges of CTV Advertising (and How to Overcome Them)

1. Platform Fragmentation

The CTV ecosystem spans dozens of streaming platforms and device types, creating complexity in campaign management and performance tracking. Managing campaigns across Roku, Samsung TV Plus, Hulu, YouTube TV, and countless other platforms can quickly become overwhelming.

The Solution: Partner with demand-side platforms (DSPs) or full-service agencies that offer centralized campaign management. These solutions consolidate your efforts across multiple platforms, providing unified reporting and streamlined optimization. Look for partners who can access premium inventory across major streaming services while maintaining consistent creative standards.

Pro tip: Start with 3-5 major platforms where your target audience is most active, then expand based on performance data.

2. Creative Production Demands

CTV ads require high-quality video content that performs within tight time constraints. Your creative needs to grab attention immediately, deliver a compelling message, and drive action—all within 15-30 seconds. This presents challenges for brands without existing video assets or production capabilities.

The Solution: Develop a creative framework that works across multiple campaigns and platforms. Partner with agencies that specialize in performance-driven video creative, focusing on scroll-stopping visuals and clear calls-to-action. Consider creating multiple creative variations to test what resonates best with different audience segments.

Budget-friendly approach: Repurpose existing video content by creating shorter, more focused cuts that highlight your strongest value propositions.

FAQ: Your CTV Questions Answered

How is CTV different from traditional TV advertising?

CTV advertising combines TV's broad reach with digital marketing's precision targeting and real-time analytics. Traditional TV ads reach everyone watching a specific program at a scheduled time, regardless of relevance. CTV ads use data to target specific audience segments based on demographics, interests, viewing behavior, and purchase history.

Key differences include: precise audience targeting, measurable ROI tracking, flexible budget options, and the ability to optimize campaigns in real-time based on performance data.

What kind of businesses benefit most from CTV advertising?

Any business seeking to reach engaged audiences with video content can benefit from CTV advertising. E-commerce brands see strong results due to the ability to track conversions directly. Local businesses benefit from geographic targeting capabilities. B2B companies can reach decision-makers during their personal viewing time when they're more receptive to brand messages.

Industries seeing particular success include: retail and e-commerce, automotive, financial services, healthcare, and subscription-based businesses.

What's the ideal length for a CTV ad?

Most effective CTV ads run 15-30 seconds, with 15-second spots showing the highest completion rates. Your creative needs to grab attention within the first 3 seconds and deliver a clear value proposition quickly. The format demands concise storytelling that focuses on one primary message rather than multiple selling points.

Consider your campaign goal: brand awareness campaigns can use the full 30 seconds, while direct response campaigns often perform better with shorter, action-focused 15-second spots.

Can small businesses afford CTV advertising?

Yes, programmatic buying and flexible minimum spends make CTV accessible to businesses of all sizes. Many platforms allow campaign starts as low as $1,000-$5,000, significantly lower than traditional TV advertising minimums. The key advantage for smaller businesses is measurable ROI—you can track exactly which campaigns drive results and adjust spending accordingly.

Small businesses should focus on geographic targeting and specific audience segments to maximize budget efficiency while competing effectively against larger brands.

Ready to Make Your CTV Debut?

The CTV advertising opportunity has never been stronger. With holiday streaming viewership spiking by over 20%, your audience is spending more time than ever on platforms like Hulu, ESPN, and YouTube TV. The growing cord-cutting trend and projected $27 billion CTV ad market by 2025 create an unmissable opportunity for brands ready to embrace this channel.

Why CTV Should Be Your Next Marketing Priority

CTV delivers the perfect combination of TV's broad reach with digital marketing's precision. You get unskippable ads, advanced targeting capabilities, and measurable ROI—benefits that traditional TV and many digital channels simply can't match.

Getting Started with CTV Advertising

Ready to launch your first CTV campaign? Start by identifying your target audience and preferred streaming platforms, develop compelling 15-30 second video creative, and choose between direct buying for premium placements or programmatic buying for flexible optimization.

The key to CTV success lies in combining strategic targeting with creative that stops the scroll and drives action.

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.