The new, targeted TV landscape—and how not understanding it could cost you wasted ad dollars

As a digital media manager, I hear it all the time: “My audience is too hard to reach on TV.”

That used to be true. In the beginning, paid advertising was simply broadcast to everyone who happened to be huddled around a TV at a given moment. You used ratings and show demographics to try to get your message in front of the biggest and “best” audience.

Today, we call that old-school vehicle “linear TV,” and it’s slowly fading. Cable TV subscriptions were down to 42% for U.S. households in 2022, according to Statista.

But these changes can be a boon to advertisers with targeted products and services, because with the rise of streaming services, you can see who is watching what, when and where—and deliver highly targeted ads directly to a very specific audience.

This is possible because the majority of TV programming today is consumed through Connected TV (CTV) and Over-the-Top TV (OTT). A whopping 92 percent of U.S. households were reachable by CTV programmatic advertising in 2022, while the number of CTV users amounted to more than 110 million among Gen Z and Millennials. If you’re part of a marketing team putting out digital advertising, understanding these platforms and how they help you reach the exact audiences you’re looking for is essential for executing campaigns that make the most of every ad dollar you spend.

First, let’s dig into what terms like CTV and OTT exactly mean; then we’ll explore what you need to know to use these platforms strategically.

Learning your acronyms—CTV versus OTT

Perhaps you’re already well-versed in the mediums available for you to reach television viewers, but if not, it’s helpful to understand the division between internet streaming TV and the TV we get through a satellite or antenna, as well as Over-The-Top TV.

  • CTV refers to the tool or device—a smart TV (Roku, Amazon Fire TV, Apple TV, or Google Chromecast are all examples) or a gaming console (PlayStation) that allows you to stream content through the internet.
  • Linear TV, on the other hand, is the old-school, pre-streaming method, watching programs at their scheduled broadcasting times. This includes things like cable and satellite TV. (Not to complicate things, but some smart TVs (aka CTVs) can be used to watch linear television.)
  • Over-The-Top TV, known as OTT, isn’t the device at all, it’s the content. The television programs you access through internet streaming are OTT. One key differentiation is that you can watch them at any time, unlike linear television, which forces viewers to catch programs at their scheduled broadcasting time.

Need more information? Here’s a nice primer from StackAdapt, one of Interrupt’s preferred Demand-Side Platforms (DSP), to give you a deeper dive into the differences. For our purposes, we’ll focus next on how planning with intention around these mediums is the difference between a digital campaign that bunts your message versus one that sends it soaring into the outfield.

Granular or broad, that is the question

If you bucket all those internet-based TV opportunities—on Connected TV specifically, but also via Over-The-Top television people are streaming on their laptops and phones—you’ll find maximum brand awareness for the best price. It’s a huge contrast to linear TV, which demands that campaign dollars be splashed around on people who won’t be receptive to your message. The audiences you can target on OTT/CTV are far more granular than the audiences on linear TV.

But how targeted should a digital campaign be to be effective? The difference between a super-specific audience versus a broader one matters for how far you want which messages to go. And you can achieve incredible specificity thanks to the targeting capabilities of OTT/CTV with first party and third party data.

First party data is information about customers who’ve had an interaction with you already—a visitor to your website or someone signed up to receive your emails. This is the low-hanging fruit of data that can be utilized to build a segment that already has a relationship with your brand, people you speak to when you want to drive conversions.

You can find all those customers on Hulu, Roku, Sling and more with the tracking capabilities that exist now. But that might be just 1,000 people. It’s precise, so you guarantee that your ad is delivered to your intended people, but it has its limitations too. Third party data—curated information you gather about people based on their age, job title, the websites they visit, the brands they seem to enjoy, or other information—is useful for sending an ad out to a broader audience for prospecting and scalable audiences to boost your brand awareness while trying to drive these people to become first party data.

A good campaign typically targets both precision and scale with specific messages that suit the right audience. It also ensures you don’t waste your ad buy delivering prospecting-type video messages to people who don’t need them.

The key takeaway

TV advertising isn’t what it used to be. The attention of people has shifted from linear TV to digital media players over the Internet and your ideal customer is streaming more OTT/CTV than ever before. Connected TV can help your brand stand out without wasting ad spend like linear TV or traditional approaches

A good plan today is better than a perfect plan next year. The advertisers learning how they can better optimize OTT/CTV budgets for enhanced brand awareness and better execution of business goals will be the one’s building brands for the future.

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