Key takeaways
- CTV advertising delivers video advertisements through internet-connected television devices, including smart TVs, streaming devices, and connected set-top boxes.
- CTV advertising works by identifying an available ad opportunity, selecting an eligible advertisement, inserting or delivering it, and recording performance.
- Ads can be sold directly or programmatically using technologies such as ad servers, Supply-Side Platforms (SSPs), and Demand-Side Platforms (DSPs).
- Server-Side Ad Insertion (SSAI) and Client-Side Ad Insertion (CSAI) are two approaches to delivering advertisements within streaming content.
- CTV advertising can support contextual, geographic, and audience-based targeting, subject to available data and privacy requirements.
- For streaming operators, the goal is to generate advertising revenue without compromising playback quality or the viewer experience.
Connected TV (CTV) advertising has become an important part of how streaming services monetize video watched on television screens.
Unlike traditional broadcast advertising, CTV advertising is delivered through internet-connected devices and can support digital ad decisioning, targeting, and measurement.
For OTT providers, broadcasters, media companies, and Pay TV operators, this creates opportunities to monetize viewing through advertising-supported on-demand content, free streaming channels, and hybrid subscription services.
But delivering CTV advertising requires several technologies to work together.
From identifying an advertising opportunity to selecting an ad and measuring its performance, each step influences both revenue and viewer experience.
So, how does CTV advertising actually work?
What is CTV advertising?
CTV advertising is the delivery of advertisements through internet-connected television devices while viewers watch streaming content.
CTV devices include:
- Smart TVs with built-in streaming applications
- Streaming media players connected to televisions
- Internet-connected set-top boxes
- Other supported television-connected streaming devices
CTV advertisements commonly appear within video programming, including before content begins or during advertising breaks.
The defining characteristic is the viewing environment: the advertisement appears on a connected television screen.
This distinguishes CTV advertising from streaming advertisements shown on smartphones, tablets, or computers.
How does CTV advertising work? Step by step
A typical CTV advertising workflow involves six stages.
1. A viewer starts streaming content
A viewer opens a streaming application on a smart TV or connected streaming device.
They may select an on-demand program, join a FAST channel, or start watching a live stream.
2. The platform identifies an advertising opportunity
The streaming service recognizes an available ad slot, such as a pre-roll position or scheduled commercial break.
An ad request can include information such as:
- Content category
- Device type
- Ad break duration
- Geographic information
- Available audience signals
- Advertising restrictions
The information included depends on the platform, consent status, and applicable privacy requirements.
3. An advertisement is selected
An ad server evaluates eligible advertising campaigns.
If programmatic advertising is involved, the opportunity may also be made available through an SSP, where connected buying systems can evaluate it.
The selected advertisement needs to satisfy relevant campaign, targeting, and technical requirements.
4. The advertisement is inserted
The ad is delivered using the streaming service's chosen insertion technology.
With SSAI, the advertisement is stitched into the stream through server-side infrastructure.
With CSAI, the application or video player manages the ad request and playback.
5. The advertisement plays
The viewer watches the advertisement within the streaming experience.
The transition between content and advertising should be reliable, with minimal buffering or playback disruption.
6. Advertising performance is measured
Relevant events are recorded for reporting, billing, and optimization.
These may include impressions, completed views, ad errors, and other metrics supported by the advertising system.
The simplified process is: Viewer starts streaming → Ad opportunity → Ad decision → Ad insertion → Playback → Measurement.
What is programmatic CTV advertising?
Programmatic CTV advertising uses automated technology to buy and sell advertising opportunities within connected television streaming services.
Rather than negotiating every individual placement manually, advertisers can use software platforms to access eligible advertising inventory.
Several technologies can participate in this process.
Not every CTV advertisement is sold programmatically.
Streaming providers may also sell inventory directly to advertisers or use a combination of direct and programmatic demand.
The important distinction is between how advertising inventory is sold and how the selected advertisement is technically delivered.
What are the main types of CTV advertising?
CTV advertising can appear in several streaming environments.
AVOD advertising
Advertising Video on Demand allows viewers to select individual titles while advertisements support the service's revenue model.
Ads may appear before or during playback.
FAST advertising
Free Ad-Supported Streaming TV provides scheduled linear streaming channels funded through advertising.
Ad breaks need to align with the channel schedule and playout workflow.
Live streaming advertising
CTV advertising can appear during live sports, news, entertainment, and other live programming.
Live streams require particular attention to break timing, delivery reliability, and sudden changes in audience size.
Advertising-supported subscription tiers
Some subscription services include advertising within lower-priced plans.
These propositions combine subscription revenue with advertising revenue and may apply different advertising rules to different subscriber tiers.
SSAI vs CSAI in CTV advertising
CTV services can use different approaches to insert advertising.
Two common methods are Server-Side Ad Insertion (SSAI) and Client-Side Ad Insertion (CSAI).
SSAI is often attractive for connected TV environments because it can reduce the need for the device to switch between separate content and advertising playback paths.
However, SSAI doesn't automatically eliminate buffering, measurement discrepancies, or advertising errors.
The right architecture depends on device compatibility, video workflows, measurement requirements, ad formats, and commercial needs.
How does CTV ad targeting work?
CTV advertising can use several signals to help select relevant advertisements.
Contextual targeting
Advertisements are selected according to the content being watched, such as a genre, channel category, or program type.
Geographic targeting
Campaigns may be delivered to audiences in particular geographic areas using permitted location information.
Device targeting
Advertisements can be selected according to device type, operating system, or other supported technical characteristics.
Audience targeting
Where permitted, audience information may help advertisers reach viewers based on relevant characteristics or behavior.
First-party data
Streaming providers with direct audience relationships may use appropriately collected first-party information to support advertising decisions.
The availability and permitted use of targeting data depend on consent, privacy regulations, platform policies, and technical implementation.
CTV advertising should therefore be designed around clear data governance rather than assuming every audience signal is available.
How is CTV advertising measured?
CTV advertising measurement helps operators and advertisers understand campaign delivery and commercial performance.
Common metrics include:
Some CTV advertising solutions also support attribution and other advanced measurement approaches.
However, these capabilities depend on the available data, identity methods, measurement partners, and privacy requirements.
For streaming operators, advertising metrics should also be considered alongside audience engagement and playback quality.
An increase in ad impressions may not improve long-term performance if viewers experience excessive interruptions or abandon content.
What are the benefits of CTV advertising?
CTV advertising can create value for both advertisers and streaming providers.
Monetization without requiring every viewer to subscribe
Advertising-supported services can reach audiences who prefer free or lower-priced access.
Digital campaign management
CTV supports advertising workflows that can use campaign rules, audience signals, and automated decisioning.
Measurable advertising performance
Digital reporting can provide visibility into impressions, completions, and other delivery metrics.
Multiple streaming business models
CTV advertising can support AVOD, FAST, live streaming, and advertising-supported subscription tiers.
Revenue diversification
For operators already relying on subscriptions, advertising can introduce an additional revenue stream.
These benefits depend on execution. Strong advertising demand alone doesn't guarantee a good viewer experience or profitable monetization.
What are the biggest challenges of CTV advertising?
Device fragmentation
Connected TV applications operate across different operating systems, players, and hardware generations.
Advertising technology must function reliably across supported devices.
Playback interruptions
Poor ad transitions, incompatible creative assets, and delivery failures can disrupt streaming.
Advertising needs to be coordinated with video processing and playback.
Advertising repetition
Without appropriate frequency management, viewers may encounter the same advertisement repeatedly.
This can negatively affect the experience.
Measurement complexity
Server-side insertion, multiple devices, and different measurement systems can create discrepancies between reported events.
Operators need clear measurement definitions and reconciliation processes.
Privacy and consent
Audience targeting and measurement must respect applicable privacy requirements and viewer choices.
Disconnected technology
Advertising systems that operate separately from content, applications, and audience data can increase integration and reporting complexity.
What should streaming operators look for in a CTV advertising platform?
When evaluating CTV advertising technology, operators should consider the following questions:
- Does the solution support our smart TV, set-top box, and connected TV applications?
- Can it integrate with our existing ad server and demand partners?
- Does it support our preferred SSAI or CSAI approach?
- Can it manage advertising across AVOD, FAST, and live streaming?
- How does it handle ad-break timing and playback errors?
- What measurement and reporting capabilities are available?
- Can advertising information be connected with audience and content analytics?
- How does the platform support privacy and consent requirements?
- Can the architecture scale during major live events?
- What ongoing integration and operational resources will be required?
These questions help operators evaluate advertising as part of the wider streaming service, rather than treating it as an isolated revenue function.
CTV advertising within 24i Video Cloud
24i Video Cloud brings together content management, video workflows, personalization, monetization, applications, and data within a connected streaming ecosystem.
24i Advanced Advertising supports advertising as part of this wider streaming environment.
For OTT providers, broadcasters, media companies, and Pay TV operators, this connected approach can help align CTV advertising with video delivery, applications, audience experiences, and operational requirements.
Rather than designing advertising independently from the rest of the service, operators can consider monetization alongside content workflows, device coverage, and viewer engagement.
The modular architecture also allows existing technologies to remain in place where they continue to provide value.
Conclusion
CTV advertising works by identifying advertising opportunities within connected television streaming, selecting eligible advertisements, delivering them through the video experience, and measuring performance.
It can support direct and programmatic advertising across AVOD, FAST, live streaming, and advertising-supported subscription services.
For streaming operators, successful CTV advertising depends on more than selling inventory.
Reliable ad insertion, device compatibility, measurement, privacy, and viewer experience all influence the commercial outcome.
With 24i Video Cloud, operators can connect content management, video workflows, personalization, monetization, applications, and data within a modular streaming ecosystem.
Looking to develop or improve your connected TV advertising strategy? Talk to 24i.
FAQs
What is CTV advertising?
CTV advertising is the delivery of advertisements through internet-connected television devices, including smart TVs, streaming media players, and connected set-top boxes.
How does CTV advertising work?
A streaming service identifies an ad opportunity, requests an eligible advertisement, delivers it through the video workflow, and records relevant performance events.
What is the difference between CTV and OTT advertising?
OTT advertising refers broadly to advertising within internet-delivered streaming services. CTV advertising specifically refers to advertisements viewed on connected television devices.
What is programmatic CTV advertising?
Programmatic CTV advertising uses automated buying and selling technologies, such as DSPs and SSPs, to transact eligible connected television advertising inventory.
What is SSAI in CTV advertising?
SSAI stands for Server-Side Ad Insertion. It inserts or stitches advertisements into the video stream using server-side infrastructure before delivery to the viewer.
What is the difference between SSAI and CSAI?
SSAI manages ad insertion on the server side, while CSAI uses the viewer's application or video player to request and manage advertising playback.
Can CTV advertising be targeted?
Yes. CTV advertising can use contextual, geographic, device, and permitted audience signals, depending on available data and privacy requirements.
How is CTV advertising measured?
Common metrics include impressions, completion rate, fill rate, eCPM, reach, frequency, and ad errors. Advanced measurement may also be available through supported partners.
Is CTV advertising only used in FAST?
No. CTV advertising can appear in AVOD services, FAST channels, live streams, and advertising-supported subscription tiers.
What technology is needed for CTV advertising?
CTV advertising typically requires ad decisioning, ad delivery or insertion technology, compatible video players or applications, measurement systems, and appropriate privacy and consent controls.
How does 24i support CTV advertising?
24i Advanced Advertising supports advertising within the wider 24i Video Cloud ecosystem, helping operators connect monetization with video workflows, applications, and audience experiences.
