What Is Connected TV? How CTV Advertising Works (2026)

Advertising, Connected TV

TV isn’t what it used to be, and that’s unlocking massive opportunities for performance marketers. With CTV ad spend projected to hit $38 billion in the U.S. by 2026, Connected TV (CTV) is transforming the biggest screen in the house into a precision-driven channel that rivals digital in targeting and results.

In this guide, we’ll break down what CTV advertising is. We’ll also cover how it works and key reasons it’s become a core part of the modern marketer’s toolkit. Whether you’re launching your first TV advertising campaign or trying to scale, here’s what you need to know to make Connected TV work harder for your brand in 2026.

What Is Connected TV?

Connected TV is any television set that connects to the internet and streams digital video content. This can be achieved through built-in smart TV functionalities or external devices, such as streaming sticks, consoles, or set-top boxes.

This technology allows viewers to access tons of unique content beyond the constraints of traditional broadcast channels, including popular streaming services, on-demand videos, and internet applications.

What Is CTV Advertising?

CTV advertising, or Connected TV advertising, refers to the delivery of targeted video ads on internet-connected smart TVs and streaming devices. This enables performance marketers to reach cord-cutters with the precision of digital campaigns.

CTV ads can be delivered anywhere that viewers are streaming digital content, such as through built-in apps or via devices like Roku, Apple TV, or gaming consoles.

CTV Advertising vs. OTT Advertising

OTT advertising is the broad delivery of streaming TV content across any internet-connected device—phones, tablets, and desktops included.

CTV is a subset of OTT, focused specifically on streaming TV advertising shown on actual big screens, where the inventory environment is typically premium and performance-driven. Think big channels like CBS, NBC, CNN, and many others.

• Learn More: OTT vs. CTV

CTV Advertising vs. Addressable TV Advertising

Addressable TV advertising delivers customized ads to individual households using data analytics for segmentation, traditionally on set-top boxes.

Addressable TV used to be confined to pay-TV providers like Comcast, DirecTV, and Dish; however, the term “addressability” has now evolved to include CTV/OTT environments.

CTV Advertising vs. Linear TV Advertising

Linear TV advertising is what you see when you turn on broadcast or cable television. It’s the traditional, old-school form of TV advertising that has been around for generations.

CTV advertising offers significantly better targeting and measurement than cable TV advertising and other linear mediums.

If we could summarize these distinctions into a single sentence, it would be this: OTT is the delivery method, CTV is the screen, and addressable TV describes targeting capabilities that can exist across all TV environments.

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Benefits of CTV Advertising

Where to begin? The advantages of Connected TV advertising are numerous, and more and more advertisers are tapping into them every day. Here are the top five benefits of CTV advertising that you need to know.

1. Precision Audience-Based Targeting

Audience-based targeting enables marketers to deliver highly relevant ads using both first- and third-party data on interests, behaviors, and demographics, surpassing traditional TV’s broad, programming-based approach. The best part is that savvy marketers agree, with 84% reporting that CTV delivers superior audience targeting capabilities compared to traditional linear TV.

2. Hyper-Localized IP-Based Targeting

IP-based targeting lets marketers serve personalized ads to specific geographic areas based on device location, ideal for driving local foot traffic or tailoring messages to regional audiences. And now, 80% of U.S. CTV inventory is addressable for hyper-local campaigns, offering granularity that linear TV cannot match at scale.

3. High Video Completion Rates

CTV ads benefit from engaged, lean-back viewing environments where users are more likely to watch full messages amid long-form content, boosting brand recall and impact compared to skippable digital formats. Industry benchmarks show CTV video completion rates exceeding 95% on average, ensuring complete narratives reach attentive audiences on the big screen.

4. Accurate, Real-Time Measurement and Attribution

Real-time metrics like ROAS, revenue, and website visits enable marketers to track cross-device conversions and optimize campaigns with precision. In 2025, nearly 47% of US brand and agency marketers cite attribution and measurement as a leading investment priority, highlighting the importance of CTV attribution in providing verifiable outcomes.

5. Automated Campaign Optimization

Automated optimization uses AI to balance bids, inventory quality, and verified outcomes across variables for efficient results without manual intervention. CTV achieves up to 4.5x higher ROI than linear TV, powered by continuous AI optimization across bids and inventory quality.

How Does CTV Advertising Work?

Connected TV advertising allows brands to reach their audience on smart TVs, OTT devices, and various other CTV platforms. MNTN Performance TV gives brands the power to target their audience with Connected TV ads during premium, ad-supported shows provided by top-tier networks.

With that said, regardless of the platform you choose, the CTV advertising process looks something like this:

Step 1: Build Your Audience

Use first-party data or integrated segments from providers to define high-intent audiences based on behaviors, demographics, and interests. This also enables retargeting to re-engage site visitors and guide them down the funnel.

Step 2: Set Your Budget and Goal

Input your campaign objectives (such as driving conversions or ROAS) along with your budget and start date. Automated optimization handles bidding in real time, evaluating variables to secure premium inventory that aligns with your targets.

Step 3: Upload or Build Your Creative

Drag and drop video files or connect storage services for seamless uploads. Ensure assets meet CTV ad specs, and if needed, generate new creatives via integrated tools without starting from scratch.

Step 4: Launch Your Campaign

With everything configured, deploy your ads across CTV channels. For omnichannel reach, extend with companion ads on other devices to complement your big-screen messaging and capture audiences wherever they engage digitally.

Step 5: Report in Real-Time

Monitor performance through a real-time dashboard tracking metrics like site visits, revenue, ROAS, and conversions with cross-device attribution. This ongoing insight allows for data-backed refinements to maximize campaign efficiency.

Where Are Connected TV Ads Shown?

Connected TV ads are shown on both paid and free ad-supported streaming networks and apps, which are accessed through smart TVs and other connected devices. The networks and apps are household names—think ESPN, MTV, ABC, and CBS—while the devices are in almost every living room in America (Apple TV, Roku, PlayStation, etc).

Every major streaming service now, from Netflix to Hulu, Paramount+, and Peacock, offers ad-supported tiers. This is because research has shown that cost-conscious streaming viewers (who often cut the cord on cable due to price) are looking for a lower bill. Ad-supported Connected TV is offered at a lower cost than ad-free, thus more subscribers sign up.

In fact, ad-supported tiers now account for 50% of subscriptions across major SVOD platforms, driving more inventory and lower costs for viewers. Not to mention, FAST services also reach 45% of US internet-connected households.

How Are Connected TV Audiences Targeted?

There are plenty of effective ways to reach new (and existing) audiences using MNTN, including:

• Demographic Targeting: Demographic targeting focuses on traits like age, gender, income, marital status, education, and household size to ensure your streaming TV ads reach the people most likely to be interested in your product or service.
• Geographic Targeting: Geographic targeting lets you spotlight specific areas, from a single ZIP code to the entire country, to enhance local TV campaigns, driving regional sales, or even foot traffic.
• Behavioral Targeting: Behavioral targeting analyzes web visits, search history, and past purchases to deliver a bespoke ad experience that aligns with each viewer’s habits and preferences.
• Interest-Based Targeting: Interest-based targeting aligns your ad content with what your audience cares about, from hobbies to content preferences, making your ads feel more relevant and effective.
• Retargeting (Remarketing): Retargeting brings back visitors who left your website without converting by reminding them what they’re missing.
• First-Party Data Targeting: First-party data targeting uses your own CRM lists, email subscribers, loyalty members, or past purchasers to nurture high-quality leads deeper into the funnel.
• Cross-Device Targeting: Cross-device targeting ensures your message reaches consumers across phone, tablet, and CTV, enhancing your omnichannel strategy.

CTV Metrics and Measurement

Since Connected TV is a digital ad channel at its core, it uses traditional digital marketing metrics and KPIs as a way to measure performance. Here are a few key ones everyone should know, especially if they are going to use CTV ads for performance marketing campaigns.

• Impressions: This is the number of ads served to viewers and helps you understand the true scale of your campaign.
• Return on Ad Spend (ROAS): ROAS is a performance metric that shows you how much revenue your campaign has generated in relation to the total amount of ad spend.
• Cost per Completed View: This metric tracks the average expense incurred for each viewer who watches your CTV ad in full.
• Cost per Acquisition (CPA): CPA tells you how much your campaign has to spend to secure each customer acquisition.
• Reach: Reach is the number of unique people who will be exposed to your Connected TV ad.
• Frequency: Frequency is the average number of times you’re delivering an ad to a given person.
• GRP (Gross Rating Point): GRP is used to determine how many people within an advertiser’s target audience saw an ad.
• CPP (Cost Per Point): CPP measures how well, for the price, your ads reach your desired audience.
• Target Rating Point: This term is a metric for the percentage of the advertiser’s target audience that views its advertisements.
• Cross-Screen Measurement: With cross-screen measurement, users can track and measure video metrics across different devices, such as mobile, television, OOH, Connected TV, and desktop.

Connected TV Devices

What are Connected TV devices? Well, there are quite a few to choose from, and there are many ways to stream CTV or OTT content. These are also the platforms where your CTV advertising campaigns will be shown.

Tablets, Phones, Desktops

You don’t need a TV to actually watch TV anymore. Although traditionally considered OTT devices, household devices like tablets, phones, and desktops have been transformed into mini-television sets that stream content.

OTT/CTV Devices

OTT and Connected TV devices connect to your TV to allow for a continuous stream of content, meaning that as long as your internet connection is not disrupted, you don’t need to wait for an entire piece of content to download before hitting play. Popular examples are Roku, Chromecast, Amazon Fire TV Stick, Apple TV, and the major gaming consoles.

Smart TVs

If you’re buying a big screen these days, you’re most likely buying a Smart TV. This is a television with a built-in connection to the Internet; no sticks or dongles are required.

CTV Marketing Best Practices

Given the rapidly growing user base of Connected TV devices, it’s important to consider the following items when developing your campaigns:

• Understand Your Audience: Before you start, make sure you understand your target audience well. Ads should be developed with them in mind.
• Use High-Quality, Engaging Creatives: Connected TV is premium inventory. Make sure you have an ad to match.
• Leverage Advanced Targeting: Harness CTV’s powerful targeting capabilities. Brand awareness campaigns can work fine, but CTV is built for highly focused targeting.
• Make It Interactive: Boost engagement with interactive ads. Invite viewers to learn more about your brand, or even make a purchase.
• Implement Frequency Capping: Cap how often your audience sees your ads to help limit ad fatigue. This improves the overall user experience.
• Measure and Optimize: Don’t ignore your reporting! Use real-time insights to track campaign performance and refine your ads over time.
• Embrace Cross-Device Advertising: Expand your reach with a cross-device strategy. Audiences use different devices depending on where they are. Meet them there.

CTV Advertising Examples

There are tons of great CTV ad examples to demonstrate true “living room quality.” Here are a few of our favorites.

MNTN

Our first example is one put forward by MNTN (that’s us), starring our very own Chief Creative Officer, Ryan Reynolds. We admit we may be partial, but it’s for good reason – we deploy our proprietary CTV advertising platform to boost our brand, and it works. Take a look!

Rumpl

Rumpl explored CTV advertising with a remarkable commercial showcasing their incredibly stylish and cozy blanket made entirely from recycled materials. This compelling ad instantly draws the viewer in and deeply resonates with the adventurous wanderer’s spirit.

Replacements

For those who enjoy sophisticated and stylish dining table decorations, Replacements is a perfect fit. This CTV advertisement adheres to a proven strategy, outlining a common issue, offering a resolution, and demonstrating the solution, all within a 30-second window. Right to the point!

1Password

Let’s take a look at another ad featuring Ryan Reynolds. Why not? This CTV example spotlights 1Password, a state-of-the-art cybersecurity password manager aimed at securing all your digital information. It’s another funny and memorable creative that doesn’t beat around the bush.

CTV Marketing With Performance TV

Ready to take the reins on your CTV advertising? MNTN’s performance-driven platform is all about driving real wins—not just racking up empty impressions. Picture this: you’re hitting premium audiences, tweaking things as you go, and tracking every single conversion like a pro.

Here’s what you get with MNTN Performance TV:

• MNTN Matched – AI-driven targeting pinpoints your ideal audience and serves ads at the perfect moment.
• Verified Visits™ Attribution – Connects ad views to site visits and conversions with industry-leading precision.
• Automated Optimization – AI continuously fine-tunes your campaigns to maximize performance without manual effort.
• Premium CTV Inventory – Get guaranteed placement on top streaming networks, putting your brand in front of engaged viewers.
• Reporting Suite – Access real-time performance insights to track results and refine your strategy with confidence.

Power up your CTV strategy with MNTN’s self-serve software—sign up today to get started.

Connected TV Advertising: Final Thoughts

U.S. CTV ad spending is projected to reach $38 billion in 2026, and it’s easy to see why. CTV advertising is redefining marketing with its blend of premium content and digital precision. By utilizing highly focused targeting options, real-time analytics, and interactive ad formats, brands can create campaigns that resonate on the largest screens in the house.

With Connected TV statistics showing rapid adoption and steadily growing viewer engagement, there’s never been a better opportunity for marketers to harness this powerful channel.