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Connected TV (CTV) Advertising

Television has long been the most powerful medium for brand building, but its advertising model was built for a broadcast era. Connected TV is changing that, bringing digital precision to the living room screen.

What is Connected TV?

Connected TV (CTV) refers to any television set that connects to the internet and streams video content. This includes smart TVs, streaming devices (such as dongles and set-top boxes), and gaming consoles used for video streaming. The content delivered over these devices, from subscription streaming services to ad-supported video platforms, is broadly referred to as streaming TV or over-the-top (OTT) video.

The advertising that appears within this content is what the industry calls CTV advertising.

How CTV differs from linear TV

In linear TV, ads are bought against broad audience estimates (ratings) and delivered to everyone watching a channel at a given time. There is limited targeting, no individual-level measurement, and no ability to adjust campaigns in real time.

CTV advertising operates more like digital media:

  • Addressability: ads can be targeted to specific households or audience segments based on demographic, behavioral, or first-party data
  • Measurement: impressions can be tracked at the device level, and outcomes (like website visits or in-store traffic) can be attributed to ad exposure
  • Flexibility: campaigns can be launched, paused, or adjusted quickly, without the long lead times of traditional TV buying

The CTV supply chain

Several types of players make up the CTV advertising ecosystem:

  • Streaming publishers and platforms own the content and the ad inventory, including subscription video on demand services with ad tiers, free ad-supported streaming TV (FAST) channels, and broadcaster video on demand (BVOD)
  • SSPs and ad servers manage publisher inventory and connect it to programmatic demand
  • DSPs allow advertisers to buy CTV inventory alongside other digital channels
  • Identity and data providers help match advertiser audiences to streaming households
  • Measurement partners track viewability, completion rates, and downstream outcomes

Programmatic CTV buying

CTV inventory is bought through a mix of programmatic and direct channels. Many premium placements are transacted via programmatic guaranteed or private marketplace deals. This gives advertisers access to desirable inventory with predictable pricing while publishers maintain control over their most valuable slots.

Open auction CTV is also available but tends to be more variable in terms of inventory quality and content environment.

A common metric for CTV is the video completion rate (VCR): the percentage of ads watched to completion. CTV typically delivers high completion rates compared to digital video on desktop or mobile, in part because many placements are non-skippable.

Targeting in CTV

CTV offers several targeting dimensions not available in linear TV:

  • Demographic and household targeting: age, income, family status
  • Geographic targeting: down to the city or zip code level
  • Audience segment targeting: using first-party data, third-party segments, or lookalike modeling
  • Contextual targeting: aligning ads with specific genres, content types, or platforms
  • Retargeting: reaching users who have previously interacted with a brand’s digital properties

As third-party cookie deprecation reduces targeting options in some digital environments, CTV’s reliance on device-level and household-level identifiers positions it relatively well for audience-based buying.

Measurement and attribution

One of CTV’s major advantages over linear TV is measurability. Advertisers can track:

  • Impression delivery and video completion rates
  • Frequency across devices and households
  • Brand lift (awareness and intent changes measured through surveys)
  • Conversion events, including online actions and, for retail advertisers, in-store visits

Cross-device measurement, connecting a CTV ad exposure to a mobile or desktop action by the same user, is an active area of development in the industry.

How Arago helps

Arago enables local retail advertisers to run CTV campaigns alongside their display, DOOH, and other digital channels from a single platform, making connected TV accessible to businesses that previously could not justify the cost or complexity of TV advertising.