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What is CTV Advertising & How Does it Work?

What is CTV Advertising & How Does it Work?

ProgrammaticCTV AdvertisingClick-Through Rate
July 18, 2025 4 Minutes

In a world where streaming is dominating home entertainment, Connected TV (CTV) advertising has emerged as a revolutionary channel for brands to reach highly engaged, digitally-savvy audiences.

From precise targeting to advanced measurement, CTV blends the power of television with the agility of digital marketing.

Here’s a detailed look at what CTV advertising is, how it functions, and why it’s quickly becoming a vital component of modern marketing strategies.

What Exactly is CTV Advertising?

CTV, or Connected TV, refers to any television device that connects to the internet to stream video content. This includes:

  • Smart TVs (Samsung, LG, Sony, etc.)
  • Streaming Devices (Amazon Fire Stick, Roku, Apple TV, Chromecast)
  • Gaming Consoles (PlayStation, Xbox)
  • Set-Top Boxes with Internet Capability

CTV advertising involves serving video adverts during the streaming experience on these devices, across platforms like Netflix (ad tier), Disney+, Hulu, Amazon Prime Video, YouTube, and more.

Unlike traditional broadcast or cable TV ads, CTV ads are digital-first, meaning they utilise real-time data for precise targeting, measurable results, and optimised delivery.

How Does CTV Advertising Work?

CTV advertising operates on a programmatic infrastructure, much like digital display or video advertising. Here’s a deeper look at the process:

1. Audience Targeting & Data Collection

CTV platforms collect vast amounts of anonymised data, including:

  • Demographics (age, gender, household income)
  • Viewing Preferences (genres, platforms, time of day)
  • Location Data (geo-targeting by region, city, or postal code)
  • Behavioural Data (past purchases, browsing habits)

Advertisers use these datasets to create highly specific audience segments.

2. Programmatic Media Buying

Most CTV inventory is sold programmatically via Demand Side Platforms (DSPs). This involves:

  • Real-Time Bidding (RTB) for ad placements.
  • Automated media buying to maximise efficiency and cost-effectiveness.
  • Budget controls, frequency caps, and pacing tools.

3. Ad Placement & Creative Formats

CTV ad placements typically fall within these categories:

  • Pre-roll Ads: Played before the content starts.
  • Mid-roll Ads: Inserted during content (similar to traditional ad breaks).
  • Post-roll Ads: Played after the main content concludes.

Creative formats may include:

  • Standard Video Ads (15 to 60 seconds, non-skippable or skippable)
  • Interactive Video Ads (clickable, allowing viewers to take immediate actions)
  • Shoppable Ads (direct product browsing via remote control or QR codes)

4. Measurement, Attribution & Optimisation

CTV ads are fully measurable, offering robust campaign analytics:

  • Impressions
  • View-Through Rates (VTR)
  • Completion Rates (percentage of ads watched in full)
  • Clicks & Engagement (for interactive formats)
  • Attribution Reports (linking ad exposure to website visits, app installs, or even in-store visits)

Advanced platforms even allow cross-device attribution, showing how a CTV ad led to action on a mobile or desktop device.

Benefits of CTV Advertising

Here’s why brands are rapidly increasing their CTV budgets:

1. High-Impact, Brand-Safe Environment

CTV ads appear within premium, long-form content where users are more engaged.

2. Precise Targeting at Scale

Reach specific audience groups across millions of households, eliminating wasted impressions.

3. Non-Skippable Attention

Many CTV ads are non-skippable, ensuring full message delivery.

4. Seamless Cross-Channel Integration

Combine CTV with mobile, desktop, and audio campaigns for full-funnel strategies.

5. Detailed Analytics & Measurable ROI

Track every impression and optimise campaigns in real time.

Who Can Benefit from CTV Advertising?

CTV is versatile and effective for various industries:

  • Retail & E-commerce: Drive online sales and promotions.
  • Automotive: Launch new models and retarget interested viewers.
  • Entertainment & Apps: Boost app downloads, subscriptions, or ticket sales.
  • Finance & Fintech: Build brand trust and drive lead generation.
  • Travel & Hospitality: Inspire bookings through aspirational video content.

Future of CTV Advertising

The CTV landscape is evolving rapidly. Key trends include:

  • AI-Powered Ad Optimisation
  • Shoppable TV Ads & QR Code Integrations
  • Dynamic Creative Personalisation
  • Contextual Targeting Without Cookies
  • Expansion of Ad-Supported Streaming Tiers

Brands investing in CTV now can gain a major first-mover advantage as audiences continue to migrate away from traditional TV.

Connected TV advertising offers brands a unique, scalable way to engage modern viewers through rich, targeted, and measurable video campaigns.

Whether you’re an e-commerce business looking to drive conversions, a luxury brand seeking awareness, or a startup looking for efficient video placements, CTV advertising unlocks immense value.

As viewing habits shift and technology advances, brands that embrace CTV today will be the ones leading tomorrow’s digital advertising landscape.

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