What Is CTV Advertising and How Does It Work?

TV isn't what it used to be. Streaming giants like Netflix, Max, and Disney+ skyrocketed over lockdown and viewers now expect the ability to watch what they want, whenever, and wherever they want—for a fraction of the cost of traditional broadband TV.

An impressive 94% of U.S. households own at least one TV Streaming device, which explains how streamed programming officially surpassed cable in 2023.

At the same time, the digital advertising landscape continues to evolve. The rise in Streaming TV popularity is forcing advertisers to recognize the medium's immense targeting and reach potential. In this article, we will delve into the world of CTV Advertising to explore the key features, benefits, and strategies that can set you apart from the competition.

1. What is Connected TV (CTV)?

2. What is Connected TV Advertising?

3. Advantages of Connected TV Advertising

4. How to start CTV advertising

1. What is Connected TV (CTV)?

CTV has transformed the way we consume long-form video content by bringing together the premium, big screen TV experience with the audience targeting prowess of digital. Whether at home or on the go, audiences now have many ways to stream their favorite content. No longer bound by cable subscriptions, viewers can indulge in a vast array of live and pre-recorded digital content, spanning from TV shows to blockbuster movies, from breaking news to live sports events, and beyond.

Connected TV (CTV) refers to Internet-connected devices such as smart TVs, gaming consoles, and streaming devices that allow viewers to stream videos, music, and browse the web.

1. CTV Device Examples

Let's explore the devices that bring this digital revolution to life:

Smart TVs: Experience seamless connectivity with Internet-enabled televisions. Leading brands like LG, Samsung, Sony, and Vizio offer built-in media platforms, eliminating the need for additional devices (like dongles or sticks) to stream your favorite shows and movies.

Connected devices/Sticks/Dongles: Unlock the potential of any TV with a simple HTMI plug-in. Plug them directly into your television and connect to the Internet, empowering you with access to a wide range of apps and video streaming. From Roku and Google Chromecast to Amazon Fire TV Stick and Apple TV, these devices transcend the boundaries of a smart TV.

Gaming Consoles: Immerse yourself in a world where gaming and streaming converge. Popular consoles such as Playstation, Xbox and Nintendo Switch not only cater to gaming enthusiasts but also offer built-in app stores, enabling seamless streaming of video content to your device.​​

2. Difference between CTV and OTT

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While the term CTV is often used interchangeably with over-the-top (OTT) TV, it is important to note the distinction between them. While OTT refers to the consumption of streamed content via the Internet no matter the device (be it via a gaming console or smart TV), CTV only refers to viewing that takes place on a smart TV set.

3. Connected TV audiences

Household-level devices dominate the streaming landscape, with gaming consoles and smart TVs accounting for more than 80% of streaming TV viewership. CTV audiences include both cord-cutters looking for cheaper on-demand options and loyal broadcast TV viewers. 

This audience is continuously expanding, driven by the ever-growing popularity of streaming content. As a result, advertisers have a golden opportunity to tap into this thriving market by leveraging video advertising on an impressive array of devices.

2. What is Connected TV Advertising?

In the world of Connected TV (CTV) advertising, your brand becomes part of the viewing experience during audiences' favorite movies and binge-worthy TV shows. Seamlessly delivered through streaming services on smart TVs or connected devices, CTV offers a powerful platform to engage and captivate your target audience. Picture your brand's message streaming seamlessly across smart TVs, computers, mobile devices and gaming consoles.

From interactive ads to targeted campaigns, CTV advertising allows you to connect with specific audiences while they enjoy their favorite content on streaming platforms and digital channels. As traditional cable viewership declines and cord-cutters embrace streaming services, CTV advertising emerges as a transformative solution to reach and engage your audience. Embrace the shift in content consumption and embark on a new advertising journey tailored to the evolving habits and preferences of modern viewers!

3. Advantages of Connected TV Advertising

The benefits of CTV advertising are undeniable. From precise targeting to detailed measurement and in-flight optimization, CTV offers unparalleled opportunities for brands to expand their brand reach beyond traditional channels such as in-store or online. Tap into the vast potential of streaming platforms by reaching audiences where they are already consuming content and achieve meaningful, trackable results.

1. Reach wider audiences with CTV advertising

In the age of abundant data, diverse content sources, and numerous streaming options, traditional advertisers are grappling with the challenge of declining engagement per channel.

Expand your brand's horizons and capture wider audiences through the power of CTV advertising. Brands can make their mark during premium TV shows, continuous video content on news apps, and livestreams on popular gaming platforms. This expansive reach opens doors to new possibilities and allows you to connect with diverse audiences in meaningful ways.

It empowers you to guide customers along their buying journey with impactful calls to action (CTAs). Seamlessly blend shopping experiences with entertainment, enabling viewers to explore and purchase featured products without any disruption to their enjoyment.

2. Precise targeting with CTV

CTV empowers you to go beyond broad demographics and tap into the granular interests, demographics, and more, that truly define your target audience. By segmenting viewers based on education level, income, personal interests, and consumer behaviors, you can craft laser-focused campaigns that resonate with your ideal customers.
Whether it's retargeting website visitors or expanding your reach with lookalike targeting, CTV opens up a world of possibilities for advertisers enabling them to reach the right audience with precision.

3. Connected TV location targeting 

CTV's digital prowess takes targeting a step further with hyper-localized advertising, enabling advertisers to hone in on specific locations with geolocation targeting. By leveraging viewers' IP addresses, advertisers can deliver customized messages to specific geographic regions, ensuring ads are not only relevant but also highly impactful.

Imagine reaching potential clients in their own backyard and addressing their location-specific needs and preferences. This localized approach not only enhances campaign performance but also establishes a stronger connection with your audience.

4. High video completion rates with CTV

CTV ads have a secret weapon for captivating viewers: automatic content recognition (ACR) technology. With ACR, advertisers can unlock real-time data on viewer engagement, giving them the power to fine-tune their campaigns and maximize their impact. These optimized ads are even more engaging meaning viewers can't help but stay tuned in, leading to higher completion rates and a boost in overall campaign effectiveness.

5. Real-time CTV ad optimization

Say goodbye to the limitations of linear TV advertising: with CTV ads, you have the power to modify and optimize your campaigns in real-time. No more waiting for the next airing or crossing your fingers that your message hits the mark. With CTV, advertisers can leverage real-time data to make informed decisions and fine-tune their ads on the go. This level of flexibility ensures that every precious marketing investment is spent efficiently, driving better outcomes and maximizing your return on ad spend (ROAS). 

6. Detailed measurement and accurate attribution

With CTV, you can dive deep into campaign performance and track conversions with unparalleled accuracy. Advertisers gain valuable insights by monitoring website visits, purchases, and even foot traffic to physical locations. This data-driven approach empowers advertisers to make informed decisions and optimize their marketing strategies. Say goodbye to guesswork and hello to a new era of targeted and effective advertising. Thanks to CTV advertising, you have the power to unlock the full potential of your campaigns and drive remarkable results.

Now that you have a comprehensive understanding of the benefits of CTV advertising, the question arises: How can you tap into this ad space?

4. How to start CTV advertising

With the right approach, planning and executing CTV campaigns can be a seamless process. Begin by establishing a clear strategy that aligns your brand's goals and target audience with your overall marketing objectives.

Next, choose your CTV advertising platform wisely—options are plentiful, from smart TV manufacturers to streaming sticks and video streaming services. Or, opt for streamlined CTV management with platforms like Vibe, offering an efficient solution for advertising across hundreds of premium channels.

Once the platform is chosen, it's time to craft compelling CTV ads that resonate with your audience. Consider the optimal ad format, such as 15 or 30-second spots, or explore interactive elements like QR codes to enhance engagement.

Execute your campaign by defining your target audience and leveraging data sources, be it first-party or third-party data. Laser-target your ads for precise engagement. Launch your CTV ads through your chosen platform and closely monitor performance.

Finally, here's the game-changer: CTV offers advanced capabilities. Think location attribution, site attribution, conversions, sales lifts (online and offline), and frequency capping. Maximize your campaign's punch with real-time optimization tools, making data-driven adjustments on the go.

By following these steps and utilizing the power of platforms like Vibe, you can master the world of CTV advertising, deliver successful campaigns for your brand and optimize your return on marketing investment (ROMI).

4. CTV campaign measurement

CTV advertising delivers optimized prices and strategic ad placements through automated systems. At the heart of this success is programmatic pricing, leveraging vital metrics like video completion rates (VCR) and cost per completed view (CPCV). With high ad completion rates and limited ad skipping, CTV ensures your message gets seen.

But there's more to CTV than meets the eye. Elevate your brand impact by tracking brand reach, audience reach, and brand uplift—measuring perception and preference like never before.

Feeling inspired to kickstart your CTV advertising journey? Don't miss out on the boundless opportunities CTV advertising offers to elevate your brand presence and engage with audiences. Get ready to captivate, convert and conquer CTV advertising with Vibe.

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