Enhance Your Strategy with TV+ Planning Insights!

Get free access to advanced audience insights, benchmark competitors, and uncover new opportunities. Revolutionize your TV advertising now!

Understanding Connected TV (CTV): Explained

Published: Jul. 19, 2023

With 88% of American households owning at least one internet-connected TV device, connected TV has reached an unprecedented peak. But what exactly is connected TV, and how has it transformed the television viewing experience for consumers? Let's delve into the details.

Want to learn even more? Check out our comprehensive guide to CTV vs OTT advertising.

What is Connected TV (CTV)?

Connected TV (CTV) refers to any device equipped with internet capabilities that is either connected to or embedded within a TV set, enabling users to stream video content. Some examples of CTV devices include smart TVs, as well as popular streaming devices like Amazon Fire Stick and Roku.

By utilizing CTV devices, users gain access to an extensive array of over 200 video-streaming services, surpassing the limitations of traditional cable. These services include well-known platforms such as Hulu, Netflix, Amazon Prime, Disney+, and many others, providing an unparalleled range of entertainment choices.

According to eMarketer, on average, consumers are forecasted to spend approximately 1 hour and 51 minutes per day engaged with CTV devices in 2023. This rapid growth rate presents a significant opportunity for advertisers to capitalize on this trend and allocate their resources to the CTV space for greater monetization.

Daily average time spent with connected TV among US adults, 2019-2024

Distinguishing over-the-top (OTT) and CTV advertising

OTT and CTV advertising are two related but distinct terms in the advertising landscape.

CTV refers to internet-connected televisions that support video streaming content. OTT refers to the delivery of video content directly over the internet, bypassing traditional distribution channels.

Let's consider the following scenario to understand the differences better.

  • If you tune in to your local broadcast station at the scheduled time to watch NCIS on your traditional TV set, that's linear TV.
  • If you choose to stream episodes of NCIS on Netflix using your mobile device or laptop, you are consuming OTT content.
  • If you use a streaming device like Amazon Fire TV Stick to stream NCIS on your television, you are using a CTV device to stream OTT content.

The bottom line: CTV is the physical device, while OTT is the content delivery method.

Exploring the benefits of connected TV advertising

The evolving connected TV landscape presents advertisers with a new opportunity as streaming platforms become a standard component of households' video consumption mix. As CTV viewership is projected to reach around 55 million viewers in the upcoming year, advertisers are presented with a significant opportunity to expand their reach and leverage this trend to optimize their advertising strategies within the dynamic digital ecosystem.

US TV and Connected TV ad spending, 2021-2027

The significant growth rate in the CTV space presents a plethora of opportunities for advertisers to allocate their funds and capitalize on this trend.

  1. Hyper-targeting: CTV offers advanced targeting capabilities, such as behavioral targeting, retargeting and building lookalike audiences. With granular targeting in CTV advertising, advertisers can achieve laser-like precision in reaching their desired audiences, distinguishing it from the broader targeting approach of traditional TV advertising.
  2. Cost-effective: CTV advertising provides a cost-effective edge over traditional TV ads. The ability to precisely target users ensures that ad spend is not wasted on irrelevant impressions and, in turn, maximizes campaign efficiency.
  3. Real-time metrics: Unlike traditional advertising, CTV allows for immediate measurement and optimization of metrics such as impressions, video completion rate (VCR), conversion rate (CVR), and return on ad spend (ROAS). This real-time data empowers marketers to make timely adjustments, ensuring optimal campaign performance throughout its duration.
  4. High completion rates: CTV advertising campaigns excel in reaching the intended audience and capturing their undivided attention by delivering highly personalized ads that align with the viewer's interests. Another contributing factor is the inherent "lean back" experience of TV viewership. Unlike mobile users who actively scroll and swiftly skip ads with a swipe, TV viewers sit (or lean) back to enjoy the content, making them less inclined to click or skip through ads.

Unlock the Full Potential of Your CTV Advertising with TV+

Are you ready to unlock the potential of CTV advertising and revolutionize your marketing strategy? In today's streaming-dominated landscape, CTV offers a unique opportunity to engage with your target audience in a more effective and impactful way. At Simulmedia, we specialize in harnessing the power of CTV advertising to drive remarkable results.

Our advanced technology, data-driven strategies, and experienced team will help you build awareness, drive action, and reach untapped audiences. From program placement to real-time measurement, we can help your brand navigate the complex world of CTV.

Don't miss out on the power of CTV! Take the first steps today by scheduling a demo with one of our experts.