What is a CTV?

A connected TV, or CTV, is a television set capable of accessing the internet, either through integrated features or through a secondary device. Smart TVs are the prime example of CTV devices, but the category has also expanded to cover other internet-capable gadgets like gaming consoles (e.g., Xbox), streaming devices (e.g., Chromecast, Roku), and set-top boxes or over-the-top devices.

Unlike traditional television, which locks viewers into a “linear” viewing experience with preset programming schedules, CTV allows viewers to seek out and watch the content they want, when they want it. Consequently, audiences are free to scatter and pursue individual viewing interests, resulting in a more fragmented market than the traditional TV ecosystem.

With the continued integration of the internet into everyday routines and devices (as evidenced by the growing Internet of things [IoT]), CTV has enjoyed a massive usage boom. Experts predict that over half of the households in top markets like the US, France, and Japan will use CTV devices by 2019. For current markets that are densely networked, such as millennial households and urban hubs, projections of CTV use are much higher.

CTV, then, presents a rapidly growing new front for video advertisers. Many industry members have voiced optimism about the advantages of working with CTV, such as greater support for interactivity, precision targeting, and message personalization.

How Does a CTV Work?

A connected TV or device serves as the main interface and delivery point for over-the-top (OTT) content. Simply put, a CTV is an OTT device. (You can learn more about what that means in our glossary entry.)

Through a CTV, viewers get direct access to the providers of their preferred content; by contrast, viewers of traditional TV are forced to work with the content bundles offered by their cable company, internet service provider (ISP), or a similar mediating entity.

Why Does CTV Matter?

We discuss more about the advertising possibilities and advantages of CTV in our OTT device glossary entry [link]. Briefly, though, here are the top reasons why advertisers should pay attention to CTV:

Great potential for improved audience engagement

There’s lots of market research indicating that OTT devices enjoy the highest video ad completion rates amongst key viewing platforms, with completion rates sitting as high as 93% to 95% for the medium. Advertisers certainly shouldn’t pass up the prospect of reaching more receptive audiences.

Growing support for interactive and personalized content

The fragmented, less structured nature of content delivery on CTVs presents challenges to advertisers, but it also opens up exciting possibilities. Advertisers can take advantage of CTVs’ new technology to craft more interactive content or incorporate more personalization options than they might otherwise have done with traditional TV. The ability to push out novel, creative ads, in turn, increases the chances of capturing audience’s attention.

Better targeting capabilities than traditional media

With CTV technology offering the opportunity to collect meaningful data about viewer preferences and behavior, advertisers can bring the sophisticated analytics of online advertising to the TV-viewing sphere, designing and rolling out ads with more precision.