Connected TV Advertising: The Golden Mine of Ad Tech

From television worshippers to cord-cutters — that's a century-long path we're still marching along. Instead of dying out as unnecessary with the arrival of the advanced streaming TV services, TV devices keep changing, gradually adapting to a newer reality. And now, it seems that we’ve come full circle, where connected TV has conquered the viewers' hearts.

While linear TV advertising is a shadow of its former self in terms of success, its digital brother reigns in the category of “traffic that every advertiser wants.”

That’s right, dear reader, just when we were about to accept the death of attention spans, CTV viewership exploded all around the world. In 2023, CTV accounted for more than 50% of all video ad impressions. In the world of TikTok and Instagram Reels – that’s huge.

What’s even more interesting is the fact that the numbers don’t seem to slow down, the CTV market has already reached $34 billion in ad revenue and is only expected to grow.

So, what exactly is CTV advertising? How is it different from OTT? What are the benefits of CTV ad servers? What are the common pitfalls? Time to find out!

What is Connected TV? CTV Definition

Let’s deal with basic definitions first:

• Connected TV is any dedicated device that supports streaming video content. That’s right, the range of CTV advertising platforms is huge, from your gaming console and Android TV to Samsung’s latest TV set.
• CTV advertising implies ads that are delivered during a movie, series, or other form of video content, as long as it is viewed on a TV set.
• CTV ad server is any ad server that can host and serve CTV ads.

Unlike linear TV ads, CTV ads can be displayed during any internet content, including YouTube, over-the-top content, and media available across websites scattered over the web.

Some people who ask questions like "what does CTV mean in advertising?" may mistakenly assume that this is the same as internet TV.

However, internet TV can be broadcast on any device, not necessarily a TV set, and feature the same channels provided by cable or satellite.

This is more of a connection between the viewer and the broadcaster, while connected TV is a standalone device that can be used to watch (or even play, like with PS5) any kind of content.

Connected television is closest to smartphones in its nature. In the past, we had "brick" mobile phones that could only dial and ring. Same story with TV sets, which could only receive signals from a source and turn them into live videos.

Thus, CTV sets are often called smart TVs, so while we speak of connected TV advertising, we can also call it smart TV ads.

What Counts as a CTV Advertising Platform

That’s a lot of info, and we suspect there’s still some confusion about ctv advertising meaning. So before we move on, let’s once again make a distinction of which devices are suitable for CTV advertising examples:

• Smart TV sets with built-in streaming TV apps like Roku Pro Series, Samsung OLED TV, TCL QLED 4K TV, etc.;
• Streaming devices that connect regular TVs to the internet like Apple TV, Roku Ultra 2024, Google Chromecast, etc.;
• Gaming consoles with access to video content;

What about smartphones? Technically, they can play CTV advertising and connect to streaming platforms, so do they count? Tricky question, dear reader. While smartphones match some criteria, they are usually regarded as personal devices.

Plus, they are kind of their own thing, so marketers leave these out of the equation when it comes to the best CTV advertising platforms.

Non-CTV devices also include tablets, smartphones, laptops, etc.

Now, for the clearer difference: CTV vs OTT.

CTV vs. OTT: The Difference

What is connected TV? It's a device above all. In digital advertising, it's often accompanied by an array of other terms, some of which may seem interchangeable. For example, OTT ads are often perceived as the same as CTV ads. But they're not.

Short version: OTT is a service that streams content over the web like Netflix, Spotify, or HBO Max. CTV is a device that allows streaming video content on TV, like Samsung’s TV sets, Apple TV, or Xbox Series S. The ads differ accordingly.

Long version: there are three main differences in OTT and CTV advertising. These are:

Device vs. service

OTT can be played on CTV devices, but it can easily be played on non-CTV devices as well.

Ad formatting

No matter if it’s a video, banner, or native, the ads that play on your iPhone and the ads that play on your Apple TV have different formatting. With OTT marketing, you should create a dozen versions of the same ad before launching a campaign, but with CTV this is not the case.

Looks and interaction

CTV ads aren’t clickable. Of course, the advertiser can embed a QR code to partially solve this problem, but that’s how it is. The ad lasts for 15-30 seconds, and you can’t skip it. For that reason, these digital ads are considered to be more premium, and they cost more than their OTT counterparts.

OTT ads are clickable and (more often than not) skippable. The latter depends on the over-the-top media service; some platforms, like YouTube, allow you to skip the ad after several seconds, while others, like Jio TV, don’t have this option.

Overall, you usually see OTT and CTV working together and used in tandem, but hey, it doesn’t hurt to know the difference.

How Connected TV Advertising Works

Frequent OTT + CTV pairing led to a revolution in TV advertising, giving advertisers the chance to grab the audience with more than just linear TV ads.

CTV Ad Formats

Connected TV advertising isn't much different from any other online video advertising; the only significant distinction is that advertisers here buy specifically smart TV ad inventory instead of the more popular desktop and mobile.

This can be done directly when you negotiate the price of ad serving with the publisher on your own and use a CTV ad server to deliver the creative.

Or, you can use a demand-side platform to serve what is called programmatic TV ads. You use automated algorithms to match your targeting preferences with a relevant inventory on the connected TV platforms and streaming services.

What about the requirements? They differ from platform to platform, but generally you’d see something like:

• 1920 x 1080 pixels, 16:9;
• MP4, up to 500MB, up to 60 seconds;
• 12 Mbps+, -23 integrated LUFS;
• 23.98, 24, 25, or 29.97, 30 fps based on native rate;

Linear TV Ads vs Non-Linear TV Ads

You can serve ads on linear TV (traditional tv advertising) and non-linear TV (on-demand viewing).

Linear CTV ads will likely be served manually, as traditional television doesn't imply an internet connection. Automatic targeting and ad placement are impossible in this case.

The audience is determined by assessing Gross Rating Point (GRP) to see how many people from the specific group watch a particular program. Then, the ad will be shown during this program within a selected timeframe.

Some non-linear OTT services are entirely built on AVOD (advertising video on demand) monetization model. Here, most media buyers purchase programmatic inventory instead of direct sales and can serve the right ads to the right users via probabilistic and deterministic (cross-device) matching.

The latest one is supported by Epom DSP and is 100% accurate, while probabilistic accuracy reaches only 96%.

The most widespread connected TV ad formats are pre-roll & mid-roll videos and rich media advertisements like in-line videos, carousel ads, and TV-to-mobile.

Why Are CTV Ads So Relevant in 2025

Connected TV advertising has already been named as a major trend in programmatic for the last several years. You know how it started: the worldwide lockdown during the COVID-19 pandemic led to a significant surge in OTT and CTV ad spend popularity.

Notably, CTV viewing has risen from 2.7B hours during the pre-pandemic week of March 2 to 3.9B hours during the weeks of March 23, March 30, and April 6. This comprises 81% of the year-on-year increase.

Time went by, and as linear TV viewing has dropped, CTV has grown. Just as we're writing this best CTV advertising platforms are in high demand among marketers of every size.

Benefits of CTV Advertising for Brands and Agencies

Besides the acceleration in CTV adoption among the world population, which naturally means more eyeballs on your ads, there are more fundamental benefits of smart TV ads for your brand. Among them:

Higher Ad Viewability

The drawback of web video ads and especially display is their low viewability. Most viewers have developed banner blindness and don't see a banner at all, while ignoring in stream video ads that tend to disrupt the user experience.

Outstream video ads, which are played within the content, tend to be more engaging, but still, the audience may not feel that it's relevant for them to watch videos while reading the article.

Connected TV (CTV) advertising is more like traditional TV commercials. Sometimes they annoy us, but we still don't skip them, being in anticipation of the next episode of our favorite show. Besides, we can't really skip them outright while watching AVOD or YouTube.

And lastly, even if we could, you need much more willpower to reach for the remote control and press the right button than just tap on your phone screen.

CTV video ad viewability reaches an amazing 98%, regardless of the type of content you watch: YouTube, OTT, or regular videos on the website. That's comparable to YouTube Ads, but they're still skipped much more on mobile and desktop because, as I said above, it's easier to do.

By contrast, the regular video has a low viewability rate of 68%.

Higher Engagement Levels

For similar reasons, the audience tends to watch CTV advertising than on any other device. 97% of users remain engaged for more than 15 seconds, while only 83% do the same on mobile.

According to Innovid, ad campaigns that are run exclusively on Connected TV demonstrate a 335% higher engagement rate than those run on mobile or desktop.

Reduced Cost Per Impression

For top-tier countries, average CPMs for video advertising starts from $5 and ends somewhere near $30. Average CPMs for connected TV video ads reach $20, though. I should admit that web video comes in different formats, are tailored to different placements, and can be of varying quality.

Connected TV ads usually have no other option but to be of premium quality, as they're going to be surrounded by premium content. 55% of survey respondents confirmed that.

But here, unlike regular web videos, each ad usually receives more than just one impression.

People typically have one TV per household, and prefer watching it in the company of two or three. This means that you 2x or even 3x the number of impressions you pay for.

Thus, CPM of $20 may turn into $10 or even $7, which is quite affordable, taking into account that your ad gets a premium video placement and usually can't be skipped.

Effective Cross-Device Advertising

Who said you should limit yourself to the connected TV only? It's much more effective to retarget your users on other platforms, where they're more likely to click on the ad.

CTV advertising doesn't imply people clicking on them and buying the product outright, which some advertisers perceive as a drawback.

But it's not. As we said before, TV commercials are the ones the population trusts and engages with the most. CTV advertising has the same psychological effect and is far more memorable than web-based banners and videos.

Thus, if you run the first campaign on CTV to raise awareness of your brand and then retarget the same audience utilizing their user IDs on mobile, this can have a tremendous effect on your overall conversion rate.

Real-Time Analytics

Programmatic video, as well as any programmatic media buying, implies real-time performance tracking and round-the-clock access to analytical tools.

Linear TV commercials never had such automated measurement, as you paid not for the number of impressions, but depending on how popular the channel and the show are.

And you could never say how many people buy from your brand because of your advertising.

With connected TV, advertisers can precisely measure their ad performance, assess the effectiveness of each traffic source, and test different audiences without spending a fortune.

You can use an ad server for direct deals and DSP for programmatic sales, and thus always be able to fine-tune your campaigns or optimize them with automated bidding algorithms right away.

What Are the Issues with CTV Advertising

You’ve read about the advantages of CTV and probably come to an idea: “I should try it out!”

Well, you’re not alone. CTV advertising is a gold mine for advertisers, ad networks, and agencies of all sorts. And when there is hype and competition, there is often over-estimation.

We’re not gonna talk about the CTV bubble in this article. Ad tech experts have predicted it to burst since 2022, and as you can see, everything’s more than good right now.

There are other issues that are worth paying attention to.

• There are too many publishers producing too much ad inventory to actually sell it;
• The lack of regulations makes CTV/OTT a frequent victim of ad fraud;
• The lack of standardized identifiers often messes up the results of ad campaigns;
• All of these prevent successful players from effectively scaling and investing which reallu hurts the potential of CTV;

Honestly, this topic alone deserves its own article, but for now, don’t be afraid to invest in CTV, but stay educated on what you’re doing.

Keep track of your analytics, as different publishers track stats with different identifiers.

Understand that the portion of your successes in analytics might come from bots.

Opt for transparency and work only with the publishers and CTV ad servers that can guarantee it.

And lastly, don’t just farm money, be vocal about the issues.

How to Buy Connected TV Ad Inventory with an Ad Server

Now, for the practical part.

You can either secure a CTV or OTT advertising spot directly, just by contacting TV platforms, providers, and AVOD streaming platforms OR use RTB software to buy CTV traffic programmatically. Let's start with how you manage your direct deals via a CTV ad server.

First, create a video banner if you're going to run a standard in-video ad campaign (pre-roll, mid-roll, or post-roll placements), or use a non-standard ad format. In the first case, you need to add a new advertiser, create a new campaign, and place a banner like this:

In the second instance, you do the same thing but choose a non-standard placement. On this screen, you see the ad ready for placement.

Aside from basic information, you can see targeting options, pricing, limits, rules, and everything else you need to optimize your CTV advertising campaign. You can read in more detail about each adjustment in the Epom Help Center.

Then, request VAST tags from your publishers to receive info about their placements. An ad server will then automatically match this creative to the suitable placements provided by your supply partners based on your targeting options, priorities, and banner rules.

Later on, you'll be able to see your ad performance in the analytics tab and fine-tune your campaign accordingly.

An ad server offers detailed reporting, where you can see all the information about your audience, including impression log report, where you see all metrics regarding each impression happening as part of your ad campaign.

If you want to use extra analytics solutions, you can seamlessly integrate this tool with an ad server using a 3rd-party reporting API service and enjoy extended analytics.

Connected TV Advertising Brief FAQ

• What is CTV advertising?

  CTV advertising is a form of digital advertising that implies serving ads specifically on Connected TV devices.

• What's the difference between CTV and OTT?

  CTV is a TV set with access to the internet, while OTT is content served over the top of traditional television.

• What is programmatic TV?

  Programmatic TV is a form of programmatic advertising, where you buy media on connected TV platforms.

• What is linear and non-linear TV?

  Linear TV is traditional television broadcasted over cable, satellite, or terrestrial, where each program is aired according to the schedule. Non-linear TV is on-demand television, when you can pick any program and watch it anytime.

• How did COVID-19 influence CTV advertising?

  Connected TV ad spend increased by 40%, while CTV viewing has risen from 2.7B hours during the pre-pandemic week of March 2 to 3.9B hours during the weeks of March 23, March 30, and April 6. Brands rebalance their spend toward CTV, the channel's popularity is gaining traction.

• What are the major benefits of smart TV advertising?

  Major benefits are higher ad viewability, lower prices than for conventional TV commercials, higher view competition rate, opportunity for cross-device retargeting, and ability to fine-tune a campaign while needed.

• Are smart TV inventory slots more expensive than average video?

  Yes, they are. But those are usually premium placements that also give 2-3 real impressions instead of just one nominal, as people used to watch TV in a company of several people.

• Can I run CTV advertising in a DSP or ad server?

  Surely you can. All you have to do is to find a direct supply partner with CTV inventory or connect to an SSP with CTV traffic available. Then, you can run CTV ads just like any other digital banners.