Mary Gabrielyan
August 11, 2025
17
minutes read
If you're planning digital video campaigns in 2025, you've likely encountered the terms OTT and CTV thrown around interchangeably. While these streaming technologies share DNA, knowing the difference is the key to moving from “just live” to campaigns that actually drive results.
The streaming wars have evolved into something far more nuanced than Netflix versus cable. The current media ecosystem presents advertisers with a $343.82 billion opportunity in the United States alone—but only if they know how to navigate it. As viewers abandon linear TV at record rates (with streaming capturing 38.8% of total TV usage), marketers face a critical decision: where exactly should their ad dollars go?
This decision isn’t as simple as picking a platform. OTT (Over-the-Top) and CTV (Connected TV) are often lumped together, but they play distinct roles in content delivery and audience targeting. OTT describes the method—streaming content directly over the internet, bypassing traditional cable or satellite. CTV refers to the device—that smart TV or streaming stick that brings Netflix, Hulu, and dozens of other services to the big screen.
This distinction matters more than ever. With CTV ad spending projected to hit $33.35 billion in 2025 and 200 million US households now streaming-enabled, the stakes for getting your strategy right have never been higher. The convergence of premium content, advanced targeting capabilities, and measurable outcomes has created an advertising channel that combines television's impact with digital's precision.
But success requires more than just shifting budgets from linear TV to streaming. The fragmented nature of this space—with 377 independent OTT providers in the US market—demands strategic thinking about where and how to deploy campaigns. Factor in the challenges of cross-device attribution, varying ad formats, and the emergence of shoppable TV, and the need for clarity becomes even more pressing.
This guide delivers the essentials: what is the difference between CTV and OTT, how they really work, what makes each valuable, and how to craft campaigns that don’t just show up but stand out. In 2025, streaming ad success comes down to one thing—strategy that works.
Over-the-Top (OTT) refers to any streaming service that delivers video content directly through the internet, bypassing traditional cable or satellite distribution. Think of it as the delivery method that made cord-cutting possible. When you watch Netflix on your laptop, stream Disney+ on your phone, or catch up on Peacock through your gaming console, you're using OTT technology.
The term "over-the-top" originated from the idea of going over and above traditional broadcast methods. OTT encompasses all internet-delivered video content, regardless of the device you're using to watch it. This includes:
What makes OTT particularly powerful for advertisers is its device-agnostic nature. A single OTT campaign can reach viewers across smartphones, tablets, computers, gaming consoles, and smart TVs.
This flexibility has helped OTT capture 71% of the US population, with three-quarters of users maintaining multiple subscriptions simultaneously.
The technology behind OTT is relatively straightforward: content travels from servers through content delivery networks (CDNs) to reach viewers via broadband internet. No cable box required, no satellite dish needed. Just an internet connection and a compatible device. This direct-to-consumer approach has fundamentally changed how content creators distribute programming and how advertisers think about video campaigns.
Connected TV (CTV) specifically refers to television sets that can stream digital content through an internet connection. This includes smart TVs with built-in streaming capabilities and traditional TVs connected through external devices like Roku, Amazon Fire TV, Apple TV, or gaming consoles. If you're watching streaming content on an actual television screen, you're using CTV.
The distinction matters because CTV represents the convergence of traditional TV viewing habits with modern streaming technology. Viewers still gather in living rooms, still watch on large screens, still enjoy the communal experience of television—but now with on-demand access to thousands of content options.
Key CTV devices and platforms include:
The main difference between CTV and OTT is the viewing environment itself. CTV viewing typically happens in a lean-back, focused setting where viewers are more likely to watch content from start to finish.
This creates unique advantages for advertisers: completion rates for CTV ads often reach 90%+, and the big-screen format allows for premium, television-quality creative.
The numbers underscore CTV's dominance in streaming: 152 million Americans access CTV content through smart TVs, making it the primary way people consume streaming content. Unlike mobile or desktop viewing, CTV viewing patterns mirror traditional TV behavior—longer viewing sessions, less multitasking, and higher attention levels.
💡 For deeper insights into leveraging this growing channel, check out our comprehensive guide: Connected TV (CTV) Advertising: What It Is, How It Works, and Why It Matters.
While OTT and CTV share the common ground of streaming video, their advertising capabilities diverge in significant ways. Understanding these differences helps advertisers choose the right approach for their campaign objectives and audience behaviors.
OTT operates as a content delivery mechanism that works across any internet-connected device. When you run an OTT campaign, your ads can appear on smartphones during commutes, tablets in bed, laptops at work, or TVs in living rooms. The focus is on reaching viewers wherever they consume streaming content.
CTV, by contrast, is device-specific—your ads only appear on television screens. This limitation is also its strength. CTV guarantees that your message appears in a premium viewing environment, typically on the largest screen in the home, where viewing sessions average 123.4 minutes daily compared to shorter mobile sessions.
The technical infrastructure differs too. OTT campaigns must account for varying screen sizes, connection speeds, and device capabilities. A single creative might need to work on a 6-inch phone screen and a 65-inch TV. CTV campaigns can optimize specifically for the television experience, with consistent resolution, aspect ratios, and viewing distances.
Viewing context shapes everything about how audiences engage with ads. OTT viewing happens everywhere—on buses, in waiting rooms, during lunch breaks. Viewers might watch with headphones, without sound, or while simultaneously scrolling social media. This fragmented attention requires different creative strategies.
CTV viewing recreates the traditional TV experience with modern advantages. People settle in for longer viewing sessions, often watching with others. The remote control, not a touchscreen, drives navigation.
This lean-back environment leads to 46% ad recall rates compared to lower rates on mobile devices where distractions abound.
Sound plays differently too. CTV viewers typically watch with full audio, making sound design crucial. Mobile OTT viewers often watch on mute, requiring captions or visual-first storytelling. These behavioral differences directly impact creative effectiveness and message retention.
OTT advertising formats vary dramatically by device. Mobile and desktop OTT supports interactive ad units, clickable overlays, and companion banners alongside video content. Viewers can tap to learn more, swipe to shop, or interact with playable ad formats. These capabilities make OTT particularly effective for direct response campaigns.
CTV advertising mirrors traditional TV commercial breaks but with digital precision. Ads typically run as non-skippable 15 or 30-second spots within ad pods. While less interactive than mobile OTT, CTV ads benefit from remarkable completion rates. The emergence of QR codes and shoppable TV features is beginning to bridge the interaction gap, allowing viewers to engage using their phones as a second screen.
Placement timing also differs. OTT platforms might serve ads based on user behavior—pausing a show, opening an app, or completing an episode. CTV follows more traditional pod-based placement, with pre-roll, mid-roll, and post-roll positions that viewers expect from their TV experience.
{{ovck-1="/tables"}}
Both channels offer sophisticated targeting, but implementation varies. OTT targeting can leverage device-level data including app usage, browsing behavior, and location tracking. A fitness brand might target users who've downloaded workout apps, visited gym websites, or traveled to fitness centers.
CTV targeting operates at the household level, using IP addresses and viewing data to build audience segments. This household focus allows for family-level targeting strategies but with less individual precision than mobile OTT. However, CTV makes up for this with premium content alignment—placing luxury car ads within high-end programming where affluent households congregate.
Cross-device identification helps bridge these approaches, connecting the same user across their phone (OTT) and living room TV (CTV). This enables sequential messaging strategies where awareness builds on CTV and drives action through mobile OTT retargeting.
Scenario 1: Quick-service restaurant promoting a limited-time offer
Scenario 2: Automotive brand launching a new model
Scenario 3: E-commerce fashion retailer during holiday season
{{ovck-2="/tables"}}
The relationship between OTT and CTV is complementary. As discussed, CTV is actually a subset of OTT, representing the television-based portion of over-the-top streaming. Every CTV impression is an OTT impression, but not every OTT impression happens on CTV.
This overlap creates powerful opportunities for advertisers. A viewer might discover your brand through a CTV ad during their evening Netflix session, then encounter retargeted messaging on their phone's Hulu app during tomorrow's commute. Same OTT ecosystem, different devices, continuous brand presence.
Major streaming platforms capitalize on this convergence. Netflix, Disney+, and Amazon Prime Video deliver content across all devices (OTT) while optimizing experiences for TV viewing (CTV). Their ad platforms don't force advertisers to choose—campaigns flow across devices based on where viewers watch.
The technical infrastructure increasingly supports this unified approach. Programmatic platforms like The Trade Desk and Amazon DSP allow buyers to manage OTT campaigns holistically, with device-specific optimizations happening automatically. Identity resolution services from companies like LiveRamp connect viewing across devices, enabling true cross-device frequency capping and attribution.
For advertisers, this overlap means thinking in terms of viewer journeys rather than device silos. The most effective campaigns leverage CTV's impact for awareness and consideration, while using mobile and desktop OTT for lower-funnel actions. A coordinated approach delivers the reach of OTT with the premium experience of CTV, maximizing both brand building and performance outcomes.
The shift to streaming advertising is about accessing capabilities that traditional TV never offered. With 246.5 million OTT users in the United States and household penetration approaching saturation, these platforms deliver both scale and sophistication.
The numbers paint a clear picture of streaming's dominance: 99% of US households pay for at least one streaming service, with CTV reaching more than 200 million households in 2025. This is a targeted reach that makes every impression count.
Traditional TV buys audiences in broad strokes: adults 25-54, households with income over $75,000. OTT and CTV flip this model entirely. Advertisers can now target based on:
This precision cuts waste dramatically.
When 38% of advertisers cite precision targeting as OTT/CTV's top benefit, they're recognizing a fundamental shift in how TV advertising works.
The audience-first approach also solves reach challenges. Cord-cutters and cord-nevers—increasingly affluent and young—have abandoned linear TV entirely. OTT and CTV provide the only scaled method to reach these valuable audiences with full-sight, sound, and motion video creative.
Dynamic creative changes everything about relevance. Where linear TV shows the same ad to everyone, OTT and CTV can customize messages at the household level. A viewer in Miami sees different offers than one in Seattle. A Spanish-speaking household receives culturally relevant creative. Previous customers get retention messages while prospects see acquisition offers.
This personalization extends across the entire customer journey. Consider a travel brand's sophisticated approach:
Cross-device orchestration multiplies impact. Identity resolution technology connects the dots between a smart TV, three smartphones, two tablets, and a laptop in the same household. Advertisers can finally manage frequency holistically—preventing the annoyance of seeing the same ad 20 times while ensuring sufficient exposure for message retention.
Real-world results validate this approach. Brands implementing cross-device strategies see conversion rates improve significantly (sometimes up to 230%) compared to single-device campaigns. The ability to track a viewer from CTV awareness to mobile conversion creates closed-loop attribution previously impossible with television advertising.
The viewing environment makes all the difference. While social media users scroll past ads in milliseconds, CTV viewers watch ads to completion 90%+ of the time. This isn't just about non-skippable formats—it's about the lean-back, focused attention that comes with TV viewing.
Premium environments protect brand reputation. Major streaming platforms invest heavily in content quality and moderation. Unlike user-generated content platforms where ads might appear next to questionable content, OTT and CTV ads run within professionally produced, brand-safe programming.
In fact, 53% of advertisers consider CTV/OTT more brand-safe than social media environments.
Engagement metrics tell the story:
Ad formats respect the viewing experience. Rather than intrusive pop-ups or autoplay videos that users rush to close, CTV ads appear where viewers expect them—during natural content breaks. This contextual placement, combined with TV-quality creative, drives the kind of brand consideration that performance-focused digital channels struggle to achieve.
Content quality attracts audience quality. The streaming wars have pushed platforms to invest billions in original programming, creating environments where premium brands want to appear. Ad-supported tiers on Netflix, Disney+, and Amazon Prime Video opened inventory previously unavailable to advertisers.
This isn't just about prestige but audience composition. Viewers paying for multiple streaming services index higher on income, education, and purchase power. When your ad runs during the latest Netflix series or Prime Video's Thursday Night Football, you're reaching audiences in their most receptive moments.
Live sports streaming represents a particular opportunity. With viewership exceeding 90 million in 2025, sports content delivers:
Content alignment amplifies message impact. A cooking brand advertising during food programming sees 3x higher engagement than random placement. Fitness brands capitalizing on New Year's resolutions through targeted January campaigns on health-focused content report 40% higher conversion rates.
Nike's "New Year, New You" campaign, which used motivational videos and personalized workout plans, led to a 25% increase in downloads of its fitness app and a 30% growth in engagement.
Success in OTT and CTV advertising requires acknowledging the obstacles. The ecosystem's rapid growth has created complexity that even sophisticated advertisers struggle to manage:
A survey by the World Federation of Advertisers (WFA) and MediaSense found that nearly half (48%) of all marketing industry stakeholders believe the industry is facing its 'worst-ever' talent crisis, with 77% admitting their own teams are understaffed.
The shift from traditional TV's broad estimates to streaming's granular data creates both opportunity and complexity. Success in OTT and CTV requires moving beyond vanity metrics to measurements that connect ad exposure to business outcomes. With the right approach, advertisers can finally answer the question that has plagued TV advertising for decades: did it actually work?
The metrics that matter depend entirely on your campaign objectives. While traditional TV focused on reach and frequency, OTT and CTV enable tracking across the entire marketing funnel—from awareness through conversion.
Upper-funnel metrics establish campaign foundation:
Mid-funnel metrics reveal engagement quality:
Lower-funnel metrics prove business impact:
Platform-specific performance indicators add nuance. Roku campaigns might prioritize homepage takeover engagement, while YouTube CTV focuses on earned actions like subscriptions. The key is establishing baseline performance before campaigns launch, enabling true lift measurement rather than simple correlation.
The average US household owns 21 connected devices, creating a measurement challenge that traditional TV never faced. A viewer might see your CTV ad on their living room Roku, research on their tablet, and purchase on their phone days later. Without cross-device attribution, you're seeing fragments of success rather than the complete picture.
Modern attribution relies on identity graphs that connect devices within households. Privacy-compliant solutions use deterministic matching (logged-in users across platforms) and probabilistic modeling (IP addresses, viewing patterns) to create unified customer views. The sophistication has reached the point where advertisers can track:
The technical implementation requires three components. First, a persistent identifier strategy that respects privacy while maintaining accuracy. Second, real-time data pipelines that capture signals as they happen rather than in batched reports. Third, statistical models that separate correlation from causation—critical when nearly half of conversions happen on devices different from where ads were viewed.
Research from Google highlights the scale of this behavior, indicating that a staggering 65% of retail conversion paths involve multiple devices.
Best-in-class attribution moves beyond last-touch credit. Multi-touch attribution (MTA) distributes value across touchpoints, while media mix modeling (MMM) captures broader market effects. The most sophisticated advertisers combine both approaches, using MTA for tactical optimization and MMM for strategic planning.
{{ovck-3="/tables"}}
The tooling ecosystem for OTT/CTV measurement has matured rapidly, with specialized platforms emerging to address specific challenges. Success requires choosing tools that match your sophistication level and business needs.
Comprehensive measurement platforms:
Identity and attribution specialists:
Verification and quality assurance:
Invest in data quality over data quantity. Clean, connected, first-party data outperforms massive third-party segments. Focus on deterministic matches and verified outcomes rather than modeled audiences.
The next phase of streaming advertising will be shaped by artificial intelligence, commerce integration, and viewer empowerment. These aren't distant possibilities—they're capabilities being deployed today by forward-thinking brands and platforms.
.png)
AI is fundamentally rewiring how campaigns operate. As detailed in The Rise of AI in TV Advertising, machine learning now handles everything from creative generation to real-time bid optimization.
By 2026, 40% of all digital video ads will be AI-generated, with dynamic creative systems producing thousands of personalized variations from single concepts.
The implications extend beyond efficiency—AI enables predictive performance modeling that anticipates campaign outcomes before launch.
Commerce and content are converging at velocity. Shoppable TV has evolved from QR code experiments to sophisticated integrations where viewers can purchase products directly through their remotes. Walmart's acquisition of Vizio created a closed-loop ecosystem connecting millions of retail locations with living room screens. Amazon's Thursday Night Football broadcasts demonstrate the model: real-time product placement, instant purchasing, and same-day delivery create a new category of performance television.
FAST channels represent the biggest structural shift since cord-cutting began. These free, ad-supported networks mirror traditional TV's channel-surfing experience while delivering streaming's targeting precision.
The global FAST market will exceed $10 billion in ad revenue by 2027, driven by viewers seeking free alternatives to subscription proliferation.
For advertisers, FAST offers premium inventory at scale without the fragmentation challenges of SVOD platforms.
Live sports continues its migration from broadcast to streaming, with 90 million US viewers expected to stream sports in 2025. This shift brings appointment viewing's massive, engaged audiences into targetable, measurable environments. Early movers report higher engagement rates for ads during streaming sports compared to traditional broadcasts.
Measurement evolution accelerates through standardization efforts. The industry is coalescing around common currencies for cross-platform measurement, with initiatives like OpenAP and the ANA's cross-media measurement program gaining momentum. By 2026, advertisers will finally have apples-to-apples comparisons across linear, CTV, and digital video.
The creative canvas expands beyond traditional spots. Interactive overlays, pause ads, and immersive formats leverage streaming's technological capabilities. Virtual product placement retroactively inserts brands into existing content, while AR experiences let viewers explore products in their own spaces.
These trends point toward a future where the distinction between content and commerce, brand and performance, and TV and digital finally dissolves. The winners won't be those who master individual channels, but those who orchestrate experiences across the entire viewer journey.
The choice between OTT and CTV isn’t either/or—it’s about strategy. Most successful campaigns leverage both, but the proportion and approach depend on three critical factors: your campaign objectives, your audience's viewing behaviors, and your measurement requirements.
Start with your campaign goals. If you need immediate action—app downloads, website visits, or e-commerce purchases—OTT's cross-device capabilities and interactive formats provide direct paths to conversion. Mobile and desktop OTT excel at catching audiences in moments of decision, with clickable formats that reduce friction between interest and action. For brand building and awareness objectives, CTV's premium, lean-back environment delivers the impact and recall rates that justify higher CPMs.
Audience behavior dictates channel mix. B2B campaigns targeting professionals might prioritize desktop OTT during business hours, reaching decision-makers on their work devices. Youth-oriented brands often find mobile OTT delivers better engagement, meeting Gen Z where they consume most content. For reaching families and driving household-level decisions, CTV's communal viewing environment creates shared experiences that individual device viewing can't match.
Consider the customer journey stage. Upper-funnel campaigns benefit from CTV's television-quality creative canvas and focused attention. Mid-funnel strategies work well across both channels, using CTV for storytelling and OTT for retargeting based on engagement. Lower-funnel campaigns typically shift budget toward mobile and desktop OTT, where immediate action is just a click away.
Budget realities shape strategy too. CTV's premium CPMs ($25-45) demand larger investments but deliver unmatched completion rates and brand safety. OTT's broader definition includes more affordable inventory across devices, making it accessible for brands with limited budgets. The sweet spot often involves using CTV for hero creative moments while extending reach through more efficient OTT placements.
Measurement capabilities should influence your choice. If proving direct ROI is critical, OTT's clickable formats and device-level tracking provide clearer attribution paths. For brands focused on long-term equity and market share, CTV's similarity to traditional TV measurement makes it easier to compare against historical benchmarks.
The optimal approach uses both channels strategically:
Keep in mind: CTV falls under the OTT umbrella—they’re not rivals. The real challenge is managing both to maximize results. Winners think in terms of viewer journeys, not channel silos.
Need a partner to help choose and refine your OTT/CTV strategy? We’re here to help: just drop us a line.
Let’s keep the conversation going, feel free to reach out:
📩 Mary Gabrielyan
📧 mary.gabrielyan@aidigital.com
.svg)
.svg)
Inefficiency
Description
Use case
Description of use case
Examples of companies using AI
Ease of implementation
Impact
Audience segmentation and insights
Identify and categorize audience groups based on behaviors, preferences, and characteristics
Automated ad campaigns
Automate ad creation, placement, and optimization across various platforms
Brand sentiment tracking
Monitor and analyze public opinion about a brand across multiple channels in real time
Campaign strategy optimization
Analyze data to predict optimal campaign approaches, channels, and timing
Content strategy
Generate content ideas, predict performance, and optimize distribution strategies
Personalization strategy development
Create tailored messaging and experiences for consumers at scale
You can, but don’t just copy-paste. CTV and OTT cover different screens and user habits. A spot that works on the big screen might underperform on mobile, where viewers ditch longer ads faster. Tailor your creative: use a polished, longer version for CTV, then cut shorter, action-driven assets for mobile and desktop. Each device supports different features—think QR codes for CTV, clickable CTAs for mobile, banners for desktop. Frequency control is key; without it, viewers get bombarded and tune out. Smart frequency capping keeps your message fresh, not repetitive.
Effectiveness depends on your goal. CTV—part of the OTT universe—wins for brand building, with 90%+ completion rates and strong recall. The TV screen commands attention. But if you want quick clicks or app installs, mobile and desktop OTT usually outperform, thanks to native interactivity. Audience and context matter more than channel. Highly targeted CTV outshines broad mobile, but the reverse is true if targeting misses.
All streaming platforms are OTT, but only those viewed on a TV screen are CTV. Watch Netflix on your phone? That’s OTT. Through your Roku? Now it’s CTV. Reporting must split impressions by device to show true CTV delivery. Some platforms, like YouTube TV and Pluto TV, blur the lines—they’re OTT, but built for the living room.
Both excel—just in different ways. OTT delivers laser-focused, individual targeting using browsing and location data. CTV targets households, perfect for brands aiming for shared viewing moments or premium positioning. Cross-device strategies bridge the gap, tracking a user from their phone to the family TV. As privacy rules tighten, CTV’s stable, IP-based targeting grows more valuable, while OTT’s logged-in data remains a differentiator.
Streaming’s takeover is inevitable, but not instant. Live sports, cable holdouts, and local news keep linear TV afloat for now. Still, content production, ad tech, and younger audiences have already shifted to streaming. Expect “linear TV” itself to become just another option inside streaming apps. The future is streaming-first—forward-thinking advertisers are preparing now, while keeping a foot in traditional TV as long as the audience is there.
