CTV vs. Linear TV: Why Advertisers Are Shifting Budgets to Streaming

The way we watch television has changed—and so has the way advertisers reach their audiences. As Connected TV (CTV) viewership continues to rise, advertisers are increasingly reallocating budgets away from traditional linear TV and toward streaming platforms. It’s not just about following audience behavior—CTV also offers significant advantages in targeting, measurement, and engagement.

In fact, recent studies show that CTV viewers are 3.8 times more likely to recall ads compared to those watching linear TV. For marketers, that kind of retention can mean the difference between a missed impression and a meaningful conversion.

Audience Shift: Where Viewers Go, Advertisers Follow

Linear TV—think traditional cable or broadcast—is declining steadily. Cord-cutting is accelerating, with millions of households dropping their cable subscriptions in favor of streaming services. As of 2024, more than 70% of U.S. households subscribe to at least one CTV platform, and the average household uses three or more streaming services regularly.

This migration has created a massive opportunity for advertisers to reach consumers on platforms they actually use—whether it’s Hulu, YouTube TV, Pluto TV, or a FAST (Free Ad-Supported Streaming TV) channel.

Granular Targeting vs. Broad Reach

One of the biggest limitations of linear TV is its inability to target beyond basic demographics like age and gender. Ad buys are often based on generalized ratings and Nielsen panels, which may not reflect actual viewing behavior.

CTV, on the other hand, allows for precise, data-driven targeting. Advertisers can segment by geography, device type, household income, interests, viewing history, and even time of day. This level of specificity not only reduces waste but ensures that each impression is more relevant—and therefore more likely to drive engagement.

Real-Time Measurement and Optimization

Linear TV operates on delayed and often incomplete reporting. CTV provides advertisers with real-time data on ad performance. From impression delivery and completion rates to audience engagement and conversions, marketers have a full-funnel view of what’s working and what’s not.

This enables agile decision-making—campaigns can be adjusted mid-flight to improve outcomes, test creatives, or reallocate budget to higher-performing channels.

Viewer Experience and Ad Recall

CTV viewers are generally more engaged. They’re watching on-demand content they’ve chosen, often with fewer distractions. As a result, CTV ads tend to have higher completion rates—especially when the content is non-skippable or built into the streaming experience.

Recent studies have shown that CTV ads lead to significantly better brand recall than linear ads—3.8 times better, to be exact. The combination of full-screen video, fewer competing ads, and better contextual relevance contributes to a more memorable experience.

Cost Efficiency and Flexibility

While linear TV still commands high CPMs, it offers limited flexibility. Advertisers often need to commit to large upfronts or long-term placements. CTV offers more flexible buying options—open auctions, private marketplaces (PMPs), and programmatic guaranteed deals—all of which give buyers more control over spend, targeting, and scale.

With dynamic creative options and real-time bidding, CTV also lets advertisers tailor messages to different audiences without incurring massive production or placement costs.

CTV isn’t just replacing linear TV—it’s redefining what’s possible in video advertising. With its ability to deliver targeted, measurable, and memorable campaigns, CTV gives advertisers the tools to maximize reach and impact.

As audiences continue to shift, advertisers that prioritize CTV will be better positioned to connect with modern viewers, improve campaign ROI, and stay ahead in a rapidly evolving media landscape.