Learn what is CTV advertising, its benefits, and how it works. I’ve also included tips for creating CTV ads along with examples.
Let’s start with CTV meaning.
What Is CTV (Connected TV)?
Connected TV (CTV) is a television that can connect to the internet.
This allows it to stream videos, shows, and movies from online services like Netflix, Hulu, and YouTube, in addition to showing regular TV channels. CTVs can also access other apps, like social media and games, making them similar to a big smartphone or tablet.
What’s the Difference Between CTV and OTT?
CTV is about the hardware, while OTT is about the content.
CTV (Connected TV) refers to the actual devices that can connect to the internet and stream content. These include smart TVs, gaming consoles, and devices like Roku or Apple TV that make regular TVs “smart.”
OTT (Over-The-Top) refers to the content that is delivered via the internet to these devices. It’s called “over-the-top” because it bypasses traditional cable or satellite TV providers. Examples of OTT services are Netflix, Amazon Prime Video, and Disney+.
What Is CTV Advertising?
CTV advertising refers to showing ads on connected TV devices.
These ads can appear while people are watching streaming content on apps like Hulu, YouTube, or even on specific channels within smart TVs. It’s similar to traditional TV ads, but the big difference is that CTV ads can be more targeted.
Since CTVs are connected to the internet, advertisers can use data to show ads that are more relevant to the viewer’s interests and behaviors.
What Are the Benefits of CTV Advertising?
CTV advertising has plenty of benefits for businesses and advertisers. If you’re still on the fence about going into it, this might persuade you.
Targeted Reach
CTV advertising allows you to target specific market segments based on demographics, interests, viewing behaviors, and location. This means your ads reach the people who are most likely to be interested in your product or service.
High Engagement
Video ads on CTV are typically full-screen and non-skippable. Because of that, they capture viewers’ attention more effectively than many other ad formats.
Measurable Results
You can track and measure the performance of your ads in real time, gaining insights into metrics like impressions, view-through rates, and conversions. This helps you understand the effectiveness of your campaigns and make data-driven decisions.
Premium Content
CTV ads are often shown alongside high-quality, professionally produced content, which can enhance the perception of your brand.
Reduced Ad Fraud
CTV environments are generally more secure and less prone to ad fraud compared to other digital advertising channels.
Cross-Device Reach
Since CTV viewers often use multiple devices, you can create cross-platform campaigns that reach audiences on their TVs, smartphones, tablets, and computers.
Better ROI
With precise targeting and the ability to measure performance, CTV advertising often provides a better return on investment compared to traditional TV ads.
Flexible Formats
You can use various ad formats, such as pre-roll, mid-roll, post-roll, and interactive ads, to create more engaging and effective campaigns.
How Does CTV Advertising Work and How to Advertise on CTV
So you’ve decided to advertise on CTV. Here’s how you should go about it.
Ad Creation
As an advertiser, you first create your ad. This could be a video ad, similar to what you see on traditional TV or online platforms.
Targeting
You define your target audience. This can be based on demographics (age, gender, location), interests, behaviors, or even specific shows or genres they watch.
Platform Selection
You choose the platforms or streaming services where you want your ad to appear. Popular choices include Hulu, YouTube TV, Roku, Amazon Fire TV, and others.
Programmatic Buying
Often, CTV ads are bought programmatically, which means using automated systems to buy ad space in real-time. This allows for efficient targeting and spending.
Ad Placement
Your ad is then placed within the streaming content. It can appear before, during, or after the content, similar to traditional TV commercials, or even as a banner ad on the home screen of a streaming device.
Viewing
When a viewer watches content on a CTV device that matches your target criteria, your ad is shown to them.
Measurement and Analytics
After your ad runs, you can collect data on its performance. This includes metrics like how many people saw your ad (impressions), how many interacted with it (clicks or engagements), and other actions they took after viewing it (conversions).
Types of CTV Ads
What’s great about CTV advertising is that there are lots of different ad formats you can choose from.
Here are the different types of CTV ads you should know about.
Pre-Roll Ads
These ads play before the viewer’s selected content begins. They are typically short and engaging, capturing the viewer’s attention before their show or movie starts.
Mid-Roll Ads
These ads are shown during the streaming of content, similar to traditional TV commercial breaks. They can be more effective because viewers are already engaged with the content.
Post-Roll Ads
These ads appear after the content has finished. They can be useful for reinforcing a message or encouraging viewers to take an action, like visiting a website or signing up for a service.
In-Stream Ads
These ads can appear at various points within the content stream (pre-roll, mid-roll, or post-roll). They are usually video ads that play seamlessly within the content.
Interactive Ads
These ads encourage viewers to interact with them, such as clicking on a link, answering a question, or engaging with a mini-game. They can create a more engaging experience and increase viewer involvement.
Banner Ads
These are static or dynamic ads that appear on the screen but do not interrupt the viewing experience. They might appear at the bottom or side of the screen while the content is playing.
Home Screen Ads
These ads appear on the main interface of a CTV device or app, like the home screen of a Roku or smart TV. They can be highly visible and are seen whenever the user navigates through the platform.
Sponsored Content
Brands can sponsor specific shows or channels, integrating their message within the content itself. This can include product placements or branded segments within a show.
Overlay Ads
These are ads that appear as overlays on the screen while the content is playing. They are usually transparent and take up a small portion of the screen, providing information or calls to action without significantly disrupting the viewing experience.
Pause Ads
These ads appear when the viewer pauses the content. They take advantage of a natural break in the viewing experience to deliver a message without interrupting the content flow.
What Makes a Good CTV Ad?
Creating a good CTV ad involves several key elements. Here are some tips for making effective CTV ads.
Keep It Short and Engaging
Attention spans can be short, so make sure your ad is concise and captures interest quickly. Aim for 15 to 30 seconds to deliver your message effectively.
Clear and Compelling Message
Ensure your message is clear and easy to understand. Focus on a single, compelling idea or call to action that viewers can grasp quickly.
High-Quality Production
CTV ads should have high production values to match the premium content they’re shown with. Invest in good visuals, sound, and editing to make your ad look professional.
Strong Visuals
Use eye-catching visuals to grab attention. High-definition images and dynamic scenes can help make your ad stand out.
Relevant Content
Make your ad relevant to the audience and the content they are watching. Tailor your message to their interests and needs to increase engagement.
Personalization
Leverage data to personalize your ads. Showing personalized content based on viewer behavior or demographics can make the ad more relevant and effective.
Clear Branding
Ensure your brand is clearly presented in the ad. Include your logo, brand colors, and a consistent message that viewers will associate with your brand.
Effective Call to Action
Include a clear call to action (CTA) that tells viewers what you want them to do next. Whether it’s visiting a website, signing up for a service, or making a purchase, make the CTA straightforward and compelling.
Leverage Interactive Elements
If possible, use interactive elements to engage viewers. This could be clickable buttons, polls, or other interactive features that encourage viewers to interact with your ad.
Test and Optimize
Continuously test different versions of your ads to see what works best. Use A/B testing to compare different creatives, messages, and CTAs.
Analyze the results and optimize your ads based on performance data.
Sound and Music
Good audio can enhance your message. Use appropriate background music and sound effects to create a mood or highlight important parts of your ad. Ensure the voiceover is clear and matches the tone of your brand.
Storytelling
Tell a story that resonates with your audience.
Stories can create an emotional connection and make your ad more memorable. Make sure the story aligns with your brand values and message.
CTV Advertising Examples
The best way to learn how to effectively advertise on Connected TV is by looking ad successful campaigns from popular brands.
Here are some examples of CTV advertising to help you understand how they work.
Volvo Interactive and Data-Driven Video on Connected TV from Innovid on Vimeo.
1. Volvo – Interactive Ad
Platform: Roku and Samsung
Campaign: To showcase the new S90 model, Volvo used interactive CTV ads. These ads allowed viewers to explore the car’s interior and exterior virtually, providing personalized messages directing them to the nearest dealership.
Results: This approach led to a 35% increase in sales, demonstrating the effectiveness of interactive features in engaging viewers and driving conversions.
2. Subway – Branding Ad
Platform: Various CTV platforms
Campaign: Subway enlisted celebrities like Tom Brady and Serena Williams to introduce new menu items and announce a giveaway. The ads aimed to increase brand awareness and excitement about the new offerings.
Results: The campaign was highly successful, resulting in a 33% increase in sales and achieving the highest weekly unit volume in over eight years.
3. Buick – Interactive Choices Ad
Platform: General CTV platforms
Campaign: Buick’s interactive ad allowed viewers to choose what they wanted to learn about the car, such as interior, design, or features, enhancing engagement and personalization.
Results: The interactivity led to higher viewer involvement and better brand perception.
4. Fiverr – Customer Stories
Platform: General CTV platforms
Campaign: Fiverr highlighted real customer success stories to demonstrate the practical value of their services. This case-study approach built credibility and trust, motivating potential customers to explore Fiverr’s offerings.
Results: This narrative-focused ad helped in building a strong connection with viewers and encouraging them to consider Fiverr for their business needs.
CTV Advertising Statistics
More and more households are using Connected TV devices, which marks a significant shift from traditional TV. Advertisers are taking note and focusing more on CTV advertising.
Here are some recent statistics on CTV advertising that confirm this new trend.
Data source: Statista
Growth and Spending
- CTV Ad Spend: In the U.S., CTV ad spend reached $24.6 billion in 2023 and is projected to grow to $42.4 billion by 2027. This indicates a strong shift towards CTV as advertisers see its value in targeted outreach and audience engagement.
- Global Growth: Since 2019, CTV spending has increased by 400%, with a further 22% rise expected by the end of 2024. By 2027, the spending is anticipated to grow by 72.5%, surpassing $41 billion.
Viewer Engagement
- Viewing Time: U.S. adults are projected to spend an average of 4 minutes per day on CTV in 2024, making it the second most popular screen after mobile devices.
- Demographics: CTV viewership is particularly strong among younger audiences. In 2024, Gen Z’s CTV viewership is expected to approach 55 million, with high penetration rates (over 80%) among ages 25 to 54 and around 75% for ages 12 to 17.
Ad Formats and Performance
- Ad Types and Formats: Advanced ad formats such as shoppable ads (using QR codes) and interactive ads (allowing viewers to choose their experience) are becoming more common. These formats help increase engagement and provide better measurement of ad performance.
- Cross-Device Advertising: Effective CTV campaigns often use a cross-device strategy, targeting users on multiple platforms including desktop, mobile, and smart TVs to provide a consistent and engaging user experience.
Market Trends
- Shift from Traditional TV: Traditional TV viewership is declining, with pay-TV households decreasing from 50 million in 2021 to 41 million in 2023. Streaming services now make up nearly 39% of all TV usage, reflecting a significant shift in how viewers consume content.
Top CTV Advertising Companies
Here’s my top pick of CTV advertising platforms that simplify buying CTV ads and targeting the right audience.
1. Amazon DSP
Amazon DSP (Demand-Side Platform) allows advertisers to programmatically buy display, video, and audio ads both on and off Amazon. It has advanced targeting options and is integrated with Amazon’s extensive data to enhance ad performance.
2. Google Display & Video 360 (DV360)
Part of the Google Marketing Platform, DV360 offers comprehensive CTV advertising solutions.
It leverages Google’s vast data resources to provide precise audience targeting and advanced measurement tools. It’s a top choice for advertisers looking to optimize their campaigns across multiple screens.
3. Roku
Roku provides a dedicated CTV advertising platform that allows advertisers to reach audiences directly on their Roku devices. The platform offers a range of ad formats, including video ads and interactive ads, along with detailed analytics to track campaign performance.
4. The Trade Desk
The Trade Desk offers a powerful CTV advertising platform with advanced targeting and measurement capabilities. It supports a wide variety of ad formats and provides real-time data to help advertisers optimize their campaigns for better performance.
5. Innovid
Innovid is known for its advanced CTV advertising features, including dynamic and interactive ad formats. The platform focuses on providing detailed analytics and insights, allowing advertisers to measure the impact of their campaigns more effectively.
6. MediaMath
MediaMath offers an omnichannel approach to CTV advertising, supporting various ad formats and providing strong optimization tools. The platform also emphasizes privacy-friendly ads and has robust data partnerships to enhance targeting accuracy.
7. FreeWheel
Owned by Comcast, FreeWheel provides comprehensive solutions for CTV and OTT advertising. It offers advanced data enablement and supports transactions across all screens and sales channels, making it a versatile choice for advertisers.
8. SmartyAds
SmartyAds offers a variety of CTV ad formats and strong targeting options. The platform provides real-time analytics and optimization tools to enhance video completion rates and overall ad performance.
CTV Advertising: Final Thoughts
Have more questions about CTV advertising? Let me know in the comments – I’m happy to help you get the most out of CTV ads.
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