Connected TV (CTV) Advertising: What It Is & How It Works

Chris Rowell

Over 88% of U.S. households own at least one Connected TV (CTV) device, including 110+ million Gen Z and Millenial viewers. As viewers rapidly switch from linear TV to streaming alternatives, CTV advertising offers unprecedented access to a diverse and widening audience.

This CTV advertising guide will review what it is, why it’s important, how it works, and how you can buy CTV inventory today and start advertising in the biggest screen in the house.

📑 Table of Contents 

    1. What is Connected TV (CTV) Advertising
    2. The Benefits of Connected TV (CTV) Advertising
    3. How Connected TV (CTV) Advertising Works
    4. How to Buy Connected TV (CTV) Advertising and Ad Space
    5. How to Buy Connected TV (CTV) with KORTX

What is Connected TV (CTV) Advertising? 

CTV advertising is a type of digital marketing that appears within streaming content on Smart TVs like Roku, Apple TV, and Google Chromecast but doesn’t include other device types like smartphones, tablets, and desktop computers.

Although CTV and OTT are sometimes used interchangeably, OTT encompasses any internet-connected device, while CTV specifically refers to viewing content on a smart TV.

what is ctv advertising

📺 Related Article: OTT vs CTV: What Are They?: Learn about the differences between OTT, Linear TV, and CTV, the benefits, and which options are best for your business needs. 

The Benefits of CTV Advertising

Programmatic TV advertisers recognize significant advantages in CTV growth, targeting, optimization, and measurement, among other benefits. 

1. Boost Brand Awareness and Engagement

Connected TV boasts the highest video completion rates worldwide at a whopping 98% compared to mobile web, app, and desktop. 

CTV also leads in ad view share at 71% in 2022, indicating higher chances for complete ad viewing and better brand recognition.

Interactive CTV ads provide interactivity for viewers, enhance engagement, and increase brand recognition. 

⚡ Magna, a media strategy group, found that interactive video ads drive a 47% gain in time spent with a marketing message compared to a non-interactive ad. 

2. Reach People Where They Are 

Advanced audience targeting lets marketers connect with viewers based on demographics and interests (e.g., age, gender, location), strengthening the link between brand messages and consumers.

Nielsen’s age and gender metrics in linear TV limit targeting to concentrated demographics (e.g., men 45-69, women 24-45). Addressable CTV advertising enables micro-targeting for higher engagement.

Example: A women’s clothing company runs linear ads during a daytime soap opera because the show’s audience mainly comprises women aged 18-49. 

With addressable CTV advertising, they can specifically reach those who have bought or are interested in women’s fashion, using interactive ads with a QR code to direct viewers to shop on their website.

Brands can employ their First-Party data to reach potential customers or use tools like Axon Audience Manager for thorough audience analysis across data types.

SIMPLIFIED STREAMING Proven CTV & OTT Publisher List Download   Selecting the right streaming platform from over 200 options can be overwhelming. We've meticulously curated the best spots for you  

3. Use various online and offline metrics to track campaign success

Since most CTV ads aren’t clickable, advertisers may have difficulty connecting the ads to actual sales. 

CTV’s measurement options help marketers assess opportunities and refine strategies. These metrics also gauge campaign quality, guiding adjustments.

We measure CTV campaign success in 5 categories, along with their respective KPIs: 

  • Brand: Sentiment, Lift, Favorability
  • Reach & Frequency: Impressions, Unique Reach, Frequency Capping, Linear Overlap
  • Engagement: Completion Rate, Engagement Rate
  • Conversion: Conversion Rates, CPA, Return on Ad Spend, Online Sales
  • Offline: Foot-Traffic, Sales at Retail Locations, Customer Lifetime Value

For a more comprehensive understanding of how we measure campaign performance, skip ahead here.

4. In-flight Optimizations

Linear TV advertisements are planned and inserted well in advance, making it difficult to make changes mid-campaign. 

In-flight optimization allows advertisers to test different variables, such as creative versions, audiences, and channels, and modify them as needed to optimize performance.

📚 Related article: Interactive CTV Ads are the Secret to Higher Engagement and Longer Viewing Rates: Read more about how interactive CTV ads can increase engagement, improve brand recall, and deliver better results.

5. Local Targeting

CTV’s digital capabilities can pinpoint customers based on location through IP addresses, enabling advertisers to serve ads within a smaller geographic area. 

Advertisers can also customize messaging based on a viewer’s location, like sending the appropriate commercial to viewers closest to each of a restaurant’s five locations.

Geo-targeting like this allows advertisers to tailor their messaging to the local audience, resulting in higher engagement and, ultimately, better ROI.

How do CTV ads help with local marketing?

“Using IP addresses to pinpoint customers, advertisers can deliver highly relevant content to viewers in their local markets. This opens up a world of possibilities for local businesses, allowing them to target potential customers in a highly granular way. With the ability to customize messaging based on location, marketers can tailor their campaigns to resonate with specific audiences and achieve greater engagement and conversion.”

Image Description

Sr. Account Exec., KORTX

6. Targeting Beyond Cookies

CTV ads excel in a cookieless environment, relying on identifiers like device IDs, IP addresses, and geolocation data, rather than cookies, for targeting and attribution.

📑 Related article: Welcome to the Cookieless Future: Read more about using First-Party data and testing cookieless tracking solutions. 

7. Largest Screen In The House

Due to their prominence in a family’s living room, Connected TV screens have been dubbed as the new homepage by NewDigitalAge. CTVs, as the biggest screen at home, present advertisers with a chance to engage a captive audience in a comfortable setting.

CTVs enable visually captivating graphics and engaging ads, which is challenging on smaller screens like mobile devices or laptops.

ctv advertising guide

In co-viewing settings, with multiple people on the other side of the screen, advertisers can craft campaigns for a wider audience, driving higher engagement and brand recognition.

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How Connected TV (CTV) Advertising Works

With CTV, advertisers can reach their target audience through the largest screen in the home, with advanced targeting, measurement, and optimization capabilities that traditional TV advertising cannot offer.

Advertisers can also show interactive CTV ads to a specific audience and include engaging actions for viewers.

Here’s how it typically works: 

  1. Advertisers buy ad space on CTV through ad exchanges, programmatic CTV advertising platforms, or working directly with publishers.
  2. Advertisers then target specific audiences based on demographics, location, interests, and viewing history.
  3. Advertisers choose how to display the CTV ads, whether in-stream, in-break, or both.
  4. Advertisers can track ad performance and optimize campaigns in real time.
  5. Advertisers then measure the ad’s success to inform future campaigns.

Where Can You See Connected TV Ads?

CTV ads show alongside TV shows or live streams accessible only through streaming platforms like Smart TVs, gaming consoles, and devices like Roku and Apple TV. 

Viewers can use CTVs to watch Over-The-Top (OTT) publishers like Hulu, Peacock, Tubi, Pluto TV, Netflix, and Disney+.

Marketers can promote their products or services on these popular streaming platforms and use advanced audience targeting features to reach customers most likely to purchase. 

how to buy ctv advertising

Netflix started offering CTV advertising in late 2022.

📺  Over 54% of US households are “non-pay TV,” meaning they have canceled or never subscribed to a traditional pay TV service (e.g., cable, satellite, or telecom).

How to Buy Connected TV (CTV) Advertising and Ad Space

Advertisers typically work with media agencies or platforms specializing in CTV to buy CTV advertising. 

You’ll identify your goals, target audience, desired actions, alignment with other marketing efforts, and necessary tools. You’ll research your audience using First-Party and Third-Party data to determine who your audience is and what platforms they use the most.

Next, you’ll choose a CTV advertising platform. Options include various entities, each with distinct advantages:

  • Smart TV Manufacturers: Brands like VIZIO and Samsung offer integration directly within their Smart TVs.
  • Video Streaming Services: Platforms like Hulu and Peacock allow targeted advertising within their content streams.
  • Demand-Side Providers: Entities like Xandr connect advertisers with the appropriate ad channels.

Following platform selection, you’ll choose a CTV ad type and produce the ad. Common ad lengths are 15, 30, or 6-second spots, and you may consider interactive elements like QR codes to lead viewers to a specific page.

Using the First-Party and Third-Party data on your audience, you’ll launch the ad through the selected platform. Once the ad runs, you’ll measure and optimize its performance.

How to Buy CTV Advertising with KORTX

Delivering the right message at the right time through CTV is critical. With KORTX by your side, we simplify the complexities of CTV advertising. Our suite of advanced digital tools, tailored to the demands of CTV advertising, means your brand resonates powerfully with your audience.

Our comprehensive managed service ensures that while you focus on content, we handle the mechanics, making your campaigns more streamlined and successful.

Our Key CTV Advertising Solutions

KORTX Intelligence for CTV Strategy 

By understanding your target audience, you can optimize your CTV strategy, ensuring meaningful engagement and maximizing return on investment. That’s where KORTX Intelligence comes in, offering custom insights, in-depth research, and unique data points illuminating how your audience engages with CTV.

KORTX Intelligence for CTV delivers a wealth of actionable data points, including:

  • OTT Device Usage
  • OTT Content Consumption
  • OTT Viewership Habits

Receive tailored strategies that match your brand message with your audience’s viewing habits. Try our FREE KORTX Intelligence Report today.

Axon Audience Manager

ctv advertising axon audience manager

Axon Audience Manager, our cutting-edge CDP, analyzes customer data to offer deeper insights, enhancing personalization, optimizing marketing ROI, and fostering viewer loyalty. 

  • Harness the power of First-Party data for precise CTV targeting. Axon provides the tools you need to capture and utilize these insights effectively. 
  • With our KORTX Device Graph accessing over 200 million customers, we ensure your campaigns reach qualified audiences at home, maximizing your brand’s visibility and impact.

kortx axon audience insights

Learn how to engage constituents more personally with our exclusive early access program, or ask how it can help you with CTV advertising.

Kampus, Our Centralized Platform for Essential CTV Insights and Data

With Kampus, KORTX’s marketing platform, advertisers can conveniently access comprehensive CTV campaign details. From automated dashboard reporting to an extensive product and services catalog, Kampus confirms you have everything you need at your fingertips, all in a single interface.

Our unified platform ensures creative optimization for CTV devices, provides tailored analytics for performance tracking, and positions brands to capitalize on the growing CTV market. With hundreds of integrations, including Google Ads, Google Analytics, Meta, and Hubspot, you have unparalleled insights. 

Make data-driven decisions with our user-friendly platform, optimizing every aspect of your CTV campaigns.

KORTX Campaign Advantage ft. Split Assist™ in CTV 

Navigate the ever-changing landscape of CTV with KORTX Campaign Advantage ft. Split Assist™ by adapting your strategies to suit viewer preferences and trends.

Dynamically manage campaign budgets for maximum efficiency.

Advertisers can seamlessly test and optimize various campaign strategies, all within one unified budget framework. Test different content preferences, viewer behaviors, and device engagements within a single campaign structure. 

Our Proven Publisher List 

Our meticulous selection process guarantees access to a top-tier network of publishers, elevating the impact of your CTV campaigns.

Each publisher undergoes rigorous evaluation, offering a comprehensive assessment of their content quality, viewer statistics, and unique value prop. This thorough vetting process ensures every partner in our network meets the highest standards, providing you with a platform that maximizes the effectiveness of your campaigns. 

Download our full Proven Publisher list and learn more about activating CTV with KORTX. 

Elevate Engagement with Interactive CTV

Integrate your brand with live content on fully addressable CTV inventory. Our ad products enhance user engagement across live sports, gaming, and entertainment. Using real-time data, we identify the best moments for ad placement, ensuring your message reaches the right viewers at the right time.

With a data-driven approach, we ensure your narrative stands out in the dynamic world of live content on CTV.

View our Ad Gallery for creative inspiration!

The Future of CTV Advertising

Connected TV (CTV) advertising significantly benefits marketers looking to reach highly engaged audiences through targeted and measurable campaigns. 

With CTV advertising, marketers can promote their products or services on popular streaming platforms and use advanced audience targeting features to reach customers most likely to purchase. 

As more viewers switch to streaming services, CTV is a major ad format businesses must consider for their advertising strategies.

Advertise on the Biggest Screen in the House with CTV!

Engage your target audience on the household’s biggest screen like never before with KORTX’s comprehensive Connected TV (CTV) advertising solution.

Chris Rowell is the Co-Founder and CRO at KORTX.

Chris Rowell

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