The CTV Opportunity: Helping Brands See What They’re Missing
The advertising world is in constant flux, but 2025 marks a particularly pivotal moment. As consumer viewing habits continue their rapid shift, Connected TV (CTV) is no longer just an emerging trend; it's solidifying its position as a dominant force in the media landscape. For advertising and creative agencies, understanding and mastering CTV is not just an opportunity – it's an essential requirement to remain competitive and deliver real value to clients. At Element Human, we believe that as CTV advertising explodes, brands need to find the right platform that reaches the right audience with a compelling, engaging story while ensuring their brand's message cuts through.
CTV, encompassing smart TVs, streaming devices like Roku and Apple TV, and gaming consoles that access internet video content, is fundamentally reshaping how audiences consume media. This transformation is fueled by cord-cutting habits and the rise of streaming services with ad-supported tiers. Advertising spend on CTV is surging, projected to reach $33.35 billion in the US in 2025 and potentially $48 billion globally, with forecasts showing it surpassing traditional TV ad spend within the next few years. This dramatic rise signifies that brands across industries are moving significant budgets to CTV, recognizing its proven returns.
The Rise of Performance TV: Challenging the Giants
One of the most significant narratives surrounding CTV in 2025 is its emergence as a potent performance marketing channel, capable of rivaling giants like Google and Meta. For years, advertisers gravitated towards digital platforms for their perceived performance advantages and granular measurement, often feeling they couldn't give up on TV's impact but lacked comparable measurement. Now, CTV promises to combine the brand-building power of TV with the measurability of digital.
The reasons cited for CTV's performance potential are compelling:
Superior Ad Format: Compared to traditional programmatic offerings like display and online video (OLV), the CTV ad format is significantly superior. With high viewability rates (around 99%), large screen format, sound, and high completion rates (over 95%), CTV offers a premium, immersive viewing experience that ensures the ad is seen and heard with 100% share of screen. This contrasts sharply with display ad viewability standards which can be drastically lower.
Enhanced User Engagement: This superior format drives superior user engagement, which in turn drives performance. While proving this connection was difficult previously, advancements have made it possible recently.
Improved Measurement and Attribution: TV attribution measurement and analytics have advanced significantly. On some platforms, these tools are more transparent and verifiable than those offered by Google or Facebook, providing marketers with greater control. Advertisers can now deterministically connect TV ad exposure to outcomes like sales and measure incremental ROAS (Return on Ad Spend) at a granular level. This is becoming less feasible on platforms like the Google Display Network and Facebook.
Ease of Use: Self-serve CTV buying and measurement tools are becoming available that are reportedly easier to use than search and social interfaces, offering better transparency and control.
Given these factors, some anticipate Performance TV not only attracting advertisers away from Facebook and Google but even surpassing search as a performance channel within 5-7 years, a transition that is already underway. Advertisers are increasing CTV budgets faster than other digital formats, signaling a fundamental change in how brands reach consumers.
Navigating the Challenges in 2025
Despite the significant opportunities, the CTV landscape in 2025 is not without its challenges. Agencies and marketers must be prepared to navigate these complexities:
Measurement and Attribution: While measurement tools have improved, effectively tracking and analyzing campaigns across a fragmented ecosystem remains a concern for many industry leaders. Different platforms and reporting approaches can make unified measurement challenging. Agencies need robust solutions and expertise to provide a holistic view of performance.
Scale vs. Fragmentation: Linear TV's primary advantage was its unparalleled scale. As audiences shift to various streaming services and devices, reaching that same broad scale requires navigating a more fragmented environment.
Cost: CTV advertising rates are generally higher than traditional linear TV impressions or online video. While advocates argue the value proposition is superior due to targeting and engagement, the higher CPMs mean performance must be proportionally better. Premium inventory can be particularly costly, potentially challenging for smaller businesses.
Ad Fraud: Ad fraud remains a leading concern in the CTV space. Agencies must work with trusted partners and platforms to ensure inventory quality.
Audience Saturation and Fatigue: As ad spend increases, there's a risk of repeating the "Cable Channel Experience" with too many commercial breaks, leading to ad fatigue. Effective frequency capping and managing audience overlap are crucial.
Lack of Buyer Education: Some advertisers and agencies are still reliant on older methods or lack the understanding needed to fully leverage targeted CTV inventory. Building CTV expertise is vital for agencies to help clients overcome this learning curve.
The Creative Opportunity: Beyond the 30-Second Spot
For creative agencies, the shift to CTV presents immense opportunities and a need to evolve beyond traditional TV ad production. The standard 30-second spot is just the beginning.
Engaging Formats: CTV allows for diverse ad formats, including in-stream (pre-roll, mid-roll, post-roll), overlay ads, and interactive video ads. Interactive formats that invite user engagement (like scanning a QR code or choosing a path) can provide valuable data and turn passive watching into an engaging two-way street.
Storytelling and Emotion: The large screen format and captive viewing environment make CTV ideal for compelling storytelling and evoking emotions. Ads should feature clear narratives and consider emotion alongside audio and safe areas from the conceptualization stage.
Relevance and Personalization: The advanced targeting capabilities mean ads can be tailored to specific audience segments based on behavior, interests, or viewing habits. Creative should be high-quality and tailored to the audience's interests and viewing habits. Adding useful content like weather updates or sports scores can increase viewer attention.
Testing and Optimization: Agencies can test subtle variations in ad creative to see what resonates most with the audience and impacts performance. This allows for iterative improvements and refining creative elements for maximum impact.
Integrating Creators: Newer channels like CTV are providing monetization opportunities for creators, and some companies are exploring ways to run creator content alongside traditional ads on CTV platforms.
The convergence of CTV and retail media in 2025 also opens doors for more custom and engaging creative focused on driving conversions rather than just brand equity. Agencies have an opportunity to make a splash with creative that speaks directly to the audience in a conversion-focused way.
The study analyzed 74 videos across 37 brands with 17,544 participants to understand what makes ads successful on Twitch. It examined memory, emotion, and self-reported responses using methods like facial coding, eye-tracking, and implicit association tests.
Trustworthiness and Creativity Matter: Trustworthiness drives purchase intent, while creativity drives brand positivity.
Better Ads = Better Results: Higher video ratings correlate with increased purchase intent and other positive outcomes.
Relevance Drives Engagement: Ads that are relevant, interesting, and upbeat are more likely to be engaged with.
Avoid Neutrality: Neutral ads lead to less engagement, clarity, and uplift.
Embrace Some Confusion: A little bit of confusion can engage people's rational minds.
Tailor to the Platform: Gamer-custom content and ads that "fit" well on Twitch perform better.
Longer Ads Engage: 30-second ads tend to be more engaging than 15-second ads.
Data-Targeted Campaigns: Psychological profiles can be used to create effective, targeted campaigns.
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Strategic Imperatives for Agencies in 2025
To thrive in the evolving CTV landscape, agencies must adopt strategic approaches:
Embrace Programmatic: Programmatic advertising is the engine fueling CTV's growth, automating ad placements, optimizing targeting, and improving performance in real-time. By 2025, a large majority of CTV ad transactions are expected to be programmatic. Agencies need to sharpen their bidding strategies and optimize placements dynamically, as manual buying will become increasingly insufficient. Working with Demand Side Platforms (DSPs) can help find quality inventory efficiently.
Develop CTV Expertise: Building deep knowledge of CTV is non-negotiable. Train teams, explore programmatic platforms, and develop specific CTV strategies before competitors do. This expertise helps small to mid-sized agencies stay competitive and strengthen client relationships.
Prioritize Data and Measurement: A data-centric strategy is crucial for overcoming challenges and positioning agencies to lead. Invest in robust measurement solutions that provide a holistic view across channels. Analyze data granularly by audience segment, geoperformance, creative, and strategy to optimize campaigns.
Integrate Cross-Platform Strategies: CTV should not be treated as an isolated channel. Develop cohesive strategies that integrate CTV with linear TV (where relevant for older audiences), digital, search, and social touchpoints for a unified brand experience and cross-channel attribution.
Focus on Performance Outcomes: Clients increasingly need performance marketing outcomes that balance creative solutions with strategic initiatives. Agencies must demonstrate ROI and connect CTV exposure directly to business results like sales or conversions. Interactive and shoppable ads are key to turning CTV into a conversion engine.
Leverage First-Party Data and Privacy-First Approaches: With the decline of third-party cookies, first-party data and contextual targeting are becoming essential. Agencies that master privacy-compliant strategies will gain a significant advantage.
For small to mid-sized independent agencies, technologies like CTV offer a secret weapon to stay competitive, scale their business offering, and compete directly with larger competitors.
The Future is Connected
The data clearly shows that Connected TV is undergoing a significant transformation. It's not just growing; it's evolving into a powerful, measurable, and performance-driven channel. For advertising and creative agencies, 2025 represents a critical juncture. Those that invest in understanding CTV's nuances, build expertise, embrace programmatic buying and advanced measurement, and leverage creative opportunities will be best positioned to attract high-value clients, diversify revenue streams, and drive measurable success. The future of advertising is increasingly connected, and the time to master CTV is now.
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