CTV (Connected TV)

CTV and OTT (Over-The-Top) are two terms that are closely related, but they are not interchangeable. While CTV refers to the type of device through which content is consumed (i.e., smart TV, TV-connected streaming device, etc.), OTT refers to the content delivery method.

Specifically, OTT refers to video content that is streamed over the Internet, regardless of the device on which it is played. It includes all streaming platforms (e.g., Netflix, Hulu, YouTube, etc.) and all devices (TVs, smartphones, laptops, tablets). This means that while all CTV content falls under OTT, not all OTT-delivered content relates to CTV.

In the context of digital advertising, the distinction between CTV and OTT is an important one because it factors into how ads are designed and targeted, and ultimately the results they yield. Since ads that are delivered on CTV devices are viewed on larger screens and almost always in home environments, they can be more impactful compared to those viewed on small-screened mobile devices.

There is a range of different ad formats that comprise CTV advertising. The following are some of the most commonly employed:

• Homepage placements: Ads that are displayed in the main menu of a streaming platform or in the home screen of a smart TV interface.
• Display overlays: Banner-style ads that are displayed concurrently on top of the streaming content, without interrupting the user’s viewing experience.
• In-stream video ads: Video ads that are played between sections of video content. These can be pre-roll (before content), mid-roll (during content), or post-roll (after content) ads. These can be skippable or unskippable.

CTV advertising can vary greatly. Some include audio-based ads, ads with interactive or voice-controlled elements, or even AR (Augmented Reality), depending on the streaming platform.

CTV advertising is widely used in part due to the increasing popularity of streaming platforms and in part due to the considerable advantages that CTV ads offer. The following are some key benefits for advertisers:

• Advanced targeting: With CTV, marketers benefit from first- and third-party data as well as cross-device attribution. This gives insight into consumers’ locations, age demographics, preferences, and viewing habits to give a full picture of the consumer and their journey, which allows for precise targeting in ad campaigns.
• High engagement: CTV ads are displayed on platforms where consumers are consciously selecting and actively watching on-demand content. This provides a highly engaged audience for the ads, which can yield higher completion rates in comparison to ads displayed elsewhere.
• Measurable performance: CTV ads, in contrast to traditional broadcast ads, benefit from real-time data collection and analytics. By tracking key performance indicators (KPIs) like impressions, completions, and conversions, advertisers can gauge the effectiveness of campaigns and adjust accordingly.