CTV viewers are growing faster than ad investment

The news: Connected TV (CTV) viewers are growing at a faster rate than advertiser investment in the format—and the gap is only expected to widen, per our forecast. 20.2% of viewers’ time spent with media in 2025 went to CTV, but the format only accounted for 7.7% of ad dollars.

Behind the gap: Despite audience attention shifting toward CTV as traditional TV continues its decline, advertisers are keeping investments conservative for a few key reasons:

• Advertisers still face challenges with inconsistent measurement standards, a lack of transparency into where ads are running, and challenges managing ad frequency across the growing number of CTV providers. These issues are making it more difficult for brands to confidently invest more dollars in CTV.
• There’s complexity in CTV because of how highly fragmented the landscape is across platforms and providers. This challenge makes it difficult for advertisers to plan and execute campaigns at scale, further slowing the shift of ad dollars.
• CTV commands higher CPMs than other video channels, which can be a barrier for advertisers as economic headwinds and tariff pressures lead to tighter budgets.
• And even with declining viewership, traditional TV dominates in ad time, accounting for the vast majority of ad impressions on TV screens—making it difficult for advertisers to justify rapid budget shifts.

Yes, but: Problems with CTV might persist, but shifting viewer habits necessitate investment. Even with CTV’s struggles for brands, marketers still generally find it effective, and the format offers notable benefits over traditional TV.

• CTV provides the opportunity for advertisers to leverage innovative ad formats not possible on linear TV. Interactive and shoppable formats—such as clickable ads and QR codes—ads are shown to drive higher engagement, with interactive ads driving an average of 71 seconds of additional viewer time compared with standard preroll ads, per Innovid.
• Measurement may be inconsistent, but CTV still offers more precise audience targeting and better measurement capabilities than traditional TV. The format allows advertisers to leverage data-driven creative iteration, personalized and dynamic creative optimization, and platform-specific creative to reach specific audience segments.

What marketers should do: Increase investment toward CTV to follow audiences where they’re going, but don’t neglect linear investment until CTV matures and democratizes further.

CTV will eventually far surpass linear in viewing time and ad effectiveness—but a balanced approach remains key for the time being. Advertisers who leverage each format to account for CTV’s pros and cons will be best positioned to succeed.