By Jay Bemis | Advertising Systems Inc.
America’s advertisers continue to find a secure connection to CTV advertising, with 58% of media ad professionals polled recently saying they plan to increase investment in connected TV ads this year.
Connected TV (CTV) refers to televisions that are connected to the internet, allowing viewers to stream content live or on-demand through such apps and services as Netflix, Hulu and Disney+. It includes smart TVs, streaming devices such as Roku or Amazon Fire Stick, and gaming consoles.
Also in the same November 2024 polling from Pixability, almost a third of the media pros (32%) surveyed said they plan to decrease linear TV ad investments this year. Linear TV users are those who watch TV by more traditional means, including cable and satellite.
The experts at eMarketer forecast that spending on CTV ads will grow to $40.5 billion in the US by 2027, when linear TV ad spend will reach $56.8 billion.
“But streaming inventory has grown so much lately that ad prices are falling, and billion-dollar connected TV (CTV) ad businesses are becoming more common,” a December report from eMarketer said.
“Opportunity is knocking with the number of billion-dollar CTV ad businesses more than quadrupling from 2020 to 2026,” with at least $1 billion in connected TV ad revenues to be collected by nine companies: Disney+, Hulu, Amazon and Netflix are among those leading the way.
Why So Much Advertising Interest in Connected TV?
Marketing experts like connected TV as an advertising strategy for several reasons, including:
- Massive Reach: It’s estimated about 88% of U.S. households own at least one internet-connected TV device, making it an efficient way to reach a broad audience.
- Targeted Advertising: Unlike traditional TV, CTV allows advertisers to use data to target specific demographics, interests and behaviors, ensuring their ads reach the right audiences. A marketing specialist will tell you that highly targeted marketing campaigns can reach your advertiser’s audience through such areas as subset, behavioral, contextual, keyword-search terms, geofencing, retargeting and others.
- Engagement: Viewers are more engaged with CTV content, as they actively choose what to watch, often leading to higher ad recall and effectiveness.
Younger Audiences Are Attracted to Connected TV
Citing Nielsen figures, eMarketer says US audiences 18 years and older increased their time watching content through their CTV devices by more than 20% in 2023.
“Among younger members of Gen Z, CTV viewership is even higher, with 80.2% of 13–18-year-olds streaming content through CTV,” eMarketer says.
Older generations, meanwhile, “watch less CTV and more linear TV on average.”
“In 2024, only 32.4 million American Baby Boomers counted themselves as connected TV users — nearly half the amount of millennials,” eMarketer noted. “In 2025, the number of Gen X and Baby Boomers who watch CTV is expected to decrease by 0.3% and 0.8%, respectively.”
Another research company, Statista, forecasts that 62.6 million millennials and 56.1 million Gen Zers in the US will watch CTV in 2025.
