Connected TV: What it is and how it works

In the digital age, Connected TV (CTV) has become the new centerpiece of the living room—and a key asset for advertisers looking to move beyond generic TV spots and embrace more precise, measurable and personalized campaigns. As audiences shift en masse from traditional TV to video on demand (VOD) platforms, programmatic advertising in CTV has taken off.

This article covers everything you need to know about CTV: how it works, what formats it includes, how it's different from traditional television, and why more and more brands are choosing it to connect with their audiences in smarter ways.

TABLE OF CONTENTS

• What is Connected TV?

• The context: a massive, hyperconnected, and highly active audience

• Which devices are used for Connected TV?

• What ad formats are used in Connected TV?

• How are Connected TV ad spaces bought, and through which platforms?

• How is Connected TV measured?

What is Connected TV?

Connected TV (CTV) refers to any device that connects to the internet and streams audiovisual content on a television screen. We're not just talking about Smart TVs—though those are the most well-known—but also devices like Roku, Amazon Fire TV, Apple TV, or even video game consoles like PlayStation or Xbox.

What’s truly interesting isn't just the channel, but how it’s transforming advertising. While traditional TV remains tied to massive audiences and rigid buying methods, CTV combines the best of both worlds: the power of the big screen and the precision of digital.

🎯 Advanced segmentation, automation and real-time data:
Thanks to programmatic buying, advertisers can reach much more specific audiences, making the most out of every euro. Forget throwing a spot out into the void—now it’s all about reaching the right user, at the right time, with the right message.

🤖 Artificial Intelligence: the invisible engine
AI plays a starring role in this new landscape: not only does it optimize media buying in real time, it also analyzes consumption patterns, predicts behavior and auto-adjusts creative assets. In CTV, this translates into more relevant ads, higher efficiency, and smoother user experiences.

The context: a massive, hyperconnected, and highly active audience

• By 2025, 95% of Spanish internet users aged 16 to 75 access audiovisual content via internet on their TV—representing over 33.9 million people.
• 76% access CTV through Smart TVs, but Set Top Boxes (28%) and gaming consoles are also popular.
• CTV is social: 77% watch with someone else, and 49% multitask with a second screen (mostly mobile for social media).
• The most-watched content: series (84%) and films (77%), followed by news and sports.

So, why is this so powerful for advertisers?

CTV breaks with the traditional TV advertising model: instead of blindly buying airtime by slots and GRPs, you can now:

• Segment using real user data, interests, and behaviors.
• Buy ad space programmatically and dynamically, optimizing each impression.
• Measure results in real time to track and improve campaign performance.

What does the market say?

• 81% of industry professionals already invest or plan to invest in CTV; 51% do so to adapt to new consumption habits, while 49% aim to reach audiences abandoning traditional TV.
• Top reasons for choosing CTV include: incremental reach over traditional TV (48%), data-driven targeting (42%), and improved attention metrics (47%).

CTV is television built for a digital world where users choose what to watch, and brands choose who to target with surgical precision. If you're still investing only in linear TV, you're playing in black and white while the rest stream in 4K.

Which devices are used for Connected TV?

Several devices and technologies are used to bring internet connectivity to television screens. Here are the most common:

• Smart TVs: These are televisions with built-in internet access and integrated apps. Smart TVs allow users to stream content, use apps, and browse the web directly from their TV.
• Media streaming devices: Devices like Roku, Apple TV, Amazon Fire TV and others enhance the entertainment experience by enabling online content streaming on TVs that don't have native smart capabilities.
• Game consoles: Platforms like Xbox, PlayStation, and Nintendo Switch aren't just for gaming anymore—they also offer streaming services and access to multimedia content.

What ad formats are used in Connected TV?

CTV gives advertisers access to flexible, measurable ad formats designed for the digital environment. Say goodbye to endless linear TV ad breaks. Say hello to relevant, well-placed, and—when done right—interactive ads.

Most common formats in CTV / YouTube / OTT

• Pre-roll: Ads shown before the main content. The most preferred format by users—45% prefer ads before the content begins.
• Mid-roll: Ads inserted during natural breaks in the content. Less popular, but great for longer formats like movies or reality shows.
• Post-roll: Ads displayed at the end of the content. The challenge? Making sure your viewer is still awake.
• Interactive display and banners: Appear in the menu or as overlays. Subtle but effective—great for branding without disrupting the experience.
• Rich Media and immersive formats: Rich Media includes animations, sound, and even remote control interaction. Fun fact: 6% of users have already interacted with a QR code in a CTV ad, especially those aged 16 to 54. Immersive formats, meanwhile, offer a fully engaging digital experience.

Linear TV and HbbTV

HbbTV (Hybrid Broadcast Broadband TV) isn't a video format per se, but a global standard that combines broadcast TV with internet connectivity to deliver interactive services on Smart TVs and compatible set-top boxes.

• HbbTV Video: These are video ads shown during linear TV programming. They can include overlays that link directly to a brand's website with a single click. Some even autoplay when the user switches channels.
• HbbTV Display: These are static images, text, or GIFs designed in L- or U-shaped formats that occupy a large part of the screen. There are also banner-style ads that appear in the lower corner. Depending on the size, these ads can take up to 25% of the screen, effectively drawing viewers' attention.
  

What do users value most?

According to IAB Spain's study, here's what users appreciate most in their CTV ad experience:

• Skippable ads: Valued by 51% of users
• Fewer repetitive ads compared to other media (36%)
• Knowing how long the ad will last before it plays (21%)

Bottom line: if your ad is relevant, respectful, and non-intrusive, users are likely to accept it—and maybe even appreciate it. Bonus points if you power it with AI.

How are Connected TV ad spaces bought?

The buying method depends on the ad formats you choose, the targeting strategy, and the broader campaign context. Since the ecosystem is still evolving, there's no universal standard yet, but there are two main approaches: direct and programmatic buying.

• Direct buying: Involves one-on-one deals between advertisers and content providers or publishers, giving more control over placements and custom negotiations.
• Programmatic buying: Uses automated technology to purchase ad inventory in real time through ad platforms and networks. It offers higher efficiency and advanced targeting based on user data.

Programmatic campaigns in CTV are launched via Demand Side Platforms (DSPs), which allow advertisers to access inventory from multiple sources in one place. Some DSPs also offer dedicated tools and formats for CTV-specific buying.

The choice between both approaches will depend on your goals, your audience, and the nature of your campaign. Many brands use a hybrid approach to maximize efficiency and control.

How is CTV measured?

Here’s the good news: CTV finally allows advertisers to measure performance with accuracy—something that was always lacking in traditional TV. These are the metrics industry professionals trust the most:

Source: IAB Spain CTV Study 2025

How is Connected TV measured?

CTV measurement focuses on evaluating the effectiveness of campaigns and user interaction with content. It’s important to note that TV screens are usually shared devices, so on average, each one reaches 2–3 users.

Key CTV metrics include:

• Unique devices: Number of distinct devices that accessed CTV content within a specific timeframe.
• Impressions: Number of times an ad was displayed.
• Watch time: Total time spent watching content on CTV.
• CPM (Cost per thousand impressions): Standard pricing model to evaluate campaign reach.
• CPCV (Cost per completed view): Price paid only when a viewer finishes the ad.
• Brand lift studies: Compare brand perception between exposed and unexposed audiences.

Ready to take your brand to the big screen?

If you're aiming for broader reach, smarter targeting, and tangible results, Connected TV is the way to go. It's not just about showing up where the audience is—it's about maximizing a premium medium with digital logic, data, and performance.

At Adsmurai, we help you launch CTV campaigns with a full-funnel mindset: combining programmatic buying, AI-optimized creatives, and metrics that actually matter.

Want your brand to shine and stick in the living room spotlight?
Let’s talk.