What is Connected TV (CTV) Advertising and How Does it Work?
When you think of TV advertising, you may think of traditional linear TV advertising. You might picture paying hefty sums for a Super Bowl spot, relying on probabilistic attribution models, and hoping users convert. However, with 80.7 million U.S. households expected to cut the cord by 2026, does TV advertising still have a place in the digital age of marketing?
Enter connected TV (CTV), a targeted, attributable way of TV advertising. With platforms like Google Ads and LinkedIn now offering CTV ad placements, this method is rapidly emerging as a key channel for reaching prospects. Read on to learn more about CTV, how it works, and how to get started with CTV advertising.
What is Connected TV (CTV)?
Connected TV (CTV) refers to devices like smart TVs that are connected to the internet, allowing them to access streaming services such as Netflix, Hulu, and on-demand videos or apps.
While not all TVs come with built-in CTV capabilities, external streaming devices like Roku, Amazon Fire TV, and gaming consoles can turn any TV into a CTV. By 2027, it is estimated that 121 million U.S. households will have access to a CTV device.
The Difference Between CTV and OTT Advertising
While the terms OTT and CTV are often used interchangeably, these types of advertising target different devices. -based streaming platforms, such as Netflix, Hulu, or Amazon Prime Video, bypassing traditional methods of TV ad delivery like cable, broadcast, or satellite. CTV also delivers ads through an internet connection, but these ads are limited to TVs only. OTT ads, however, can be served across a broader range of devices, including smartphones, desktops, and laptops.
What Devices Can I Target with CTV Advertising?
While CTV advertising is traditionally associated with TVs, it can also target several other devices through both CTV and OTT advertising:
Smart TVs
Connected TV ads are traditionally shown on Smart TVs, which have a built-in internet connection. Smart TVs can connect to WiFi or ethernet and access streaming platforms directly. Ownership of Smart TVs is growing rapidly, with 79% of households in the U.S. owning one.
Streaming Devices
Devices like Roku and Amazon Fire TV allow traditional TVs to connect to the internet. Additionally, these devices allow users to install a wide range of apps, some of which may not be available on smart TVs. Streaming devices are becoming increasingly popular, with Roku reporting 85.5 million active accounts globally in 2024.
Mobile Devices
OTT ads can be served on mobile devices such as tablets, smartphones, and laptops, as users stream content both in-app and on the internet.
Gaming Consoles
Gaming consoles, such as PlayStation and Xbox, allow users to stream content directly through apps available on the console, turning a traditional TV into a CTV.
How are Connected TV Ads Measured?
CTV advertising is measured similarly to other marketing channels, with KPIs that are commonly used across all platforms. Some important KPIs include:
Impressions
The total number of times an ad was served to viewers, regardless of if an ad was shown to the same user multiple times.
Reach
The number of unique users who were served your CTV ad. This metric can help you gauge your audience penetration within specific segments.
Frequency
This metric shows how often users see your ads. For instance, a frequency of 2.0 means, on average, users are seeing your ads twice. Maintaining optimal frequency helps prevent audience fatigue from overexposure.
Engagement Rates
These metrics can help you understand how your audience interacts with your ads. On CTV, you can track actions like clicks, skips, and pauses to understand user engagement.
Cost per Acquisition (CPA)
This metric shows how much it costs for a user to take a specific action, such as signing up for a demo. CPA can vary by audience segment, helping you identify your most cost-effective audiences.
ROAS
Ultimately, down-funnel metrics like ROAS help you assess the overall effectiveness of CTV advertising for your brand, especially compared to other marketing channels.
Benefits of CTV Advertising
CTV advertising offers several benefits for advertisers, especially compared to linear TV advertising. With an increasing number of users consuming content through CTV and OTT devices, CTV advertising is an excellent opportunity to reach and remarket to your audiences. Some key benefits include:
1. Specific Audience Targeting
CTV targeting operates similarly to social media advertising, allowing advertisers to target users based on demographics, behaviors, and interests. This level of precision is a significant improvement over linear TV, where targeting is limited to specific channels, programs, or times of day.
Additionally, platforms like LinkedIn and Google Ads now allow advertisers to leverage their native targeting options like job titles, job industries, and keyword targeting within CTV campaigns, making it an excellent option for B2B or B2C brands looking to refine their audience reach.
2. Cross-Platform Reach
CTV ads can be served across devices, such as TVs and smartphones, giving advertisers the ability to remarket to users across different touchpoints. For example, a user might see an ad on their smart TV, then later be served a similar ad on their phone based on their IP address or WiFi connection.
3. Non-Skippable Ads
Many streaming providers feature non-skippable ads, meaning viewers must watch the entire ad before accessing content. This guarantees that your entire message is delivered and helps retain viewer attention.
4. Improved Measurement and Analytics
Since CTV is a digital advertising medium, advertisers can access granular data on metrics like engagement and conversions. This helps attribute conversions to CTV and improves campaign optimization.
5. Flexible Ad Formats
CTV offers a variety of ad formats, including 15- and 30-second spots. Ads can be placed pre-content, mid-content, or post-content, allowing advertisers to experiment with different formats to find the most effective approach.
Getting Started with CTV Advertising
CTV advertising does not require a large upfront investment. If you are already using LinkedIn advertising, you can easily incorporate CTV while maintaining the same targeting options you are familiar with. All you need is a 15- or 30-second video that follows LinkedIn’s recommended guidelines.
Additionally, platforms like YouTube can also support CTV ads through your Google Ads account. If you are working with Synapse, we can help optimize your ad strategy across platforms like LinkedIn and YouTube to drive targeted results.
If you are looking to use CTV advertising to drive conversions on other channels, several platforms offer CTV ad solutions, including:
Ready to Reach More Users with Connected TV Advertising?
Contact us today to learn how you can start purchasing CTV spots and expand your brand’s reach.
