Is CTV a Playground for Contextual Ads?

With the deprecation of third-party cookies on the horizon, contextual advertising is experiencing something of a resurgence, allowing advertisers to target consumers effectively without compromising privacy regulations.

While its versatility means contextual can be applied to a number of environments, the CTV landscape may prove especially appealing to advertisers. Boasting a global audience of over 1 billion, CTV has experienced staggering growth since the start of the decade. And although the medium’s use crosses demographics, it is especially prevalent amongst Millennial and Gen-Z viewers whose behaviours are reshaping the digital advertising landscape.

CTV provides far richer insights into audience behaviour and preferences than linear TV, creating more opportunities for advertisers to leverage context to tailor their campaigns for maximum impact. Additionally, reports that audiences in numerous markets actually prefer ads on streaming services compared to linear TV, can only bolster advertisers’ confidence in investing in CTV, which is already proving robust: by 2026, ad spend in the medium is projected to exceed USD£30bn (~£24.1bn).

Despite this, however, CTV is not without its shortcomings, with fragmentation in the space proving a particularly sharp thorn in advertisers’ sides. With regards to contextual advertising, CTV’s reach may be impressive, but it also lacks detail on exactly who is watching and when: a single Netflix account used to watch Peep Show, for example, can be attributed to one Gen X-er revisiting an old classic just as easily as a household of university students discovering it for the first time. Although this is certainly a problem CTV shares with traditional TV, it is one less burdensome for other areas of digital advertising, such as online or mobile, which risks taking the sheen off of CTV’s appeal.

So, is CTV a beacon for contextual advertising, or does the medium fall short where other channels prevail? We turned to industry experts for their thoughts:

CTV can go much further for contextual advertising

Sarah Lewis

Contextual and semantic-based targeting is going to play a critical role in the future of the CTV ad market. Most consumers prefer to watch CTV content with friends and family, meaning you never really know who in a household is watching. That makes individual targeting very difficult if not impossible. But with contextual or semantic-based analysis, we can pair the ad with the content itself. This makes it instantly relevant to anyone from a household that’s watching, tapping into their interests at that moment. Because it’s based on content rather than the data of individual users, it’s also a privacy-friendly approach that consumers will accept.

Advertisers have already made contextual a key element of their CTV strategy, but there’s an opportunity to go further. I’d like to see advertisers taking a more nuanced approach to how they contextually target ads. For example, a sports apparel brand can of course target sports content, but they could also look at content that evokes the kind of spirit that embodies their brand - action, adventure and excitement for example. By being more creative and looking beyond flat vertical content, advertisers can cast their nets much wider on CTV, reaching not just obvious consumers but new ones as well, helping to more effectively grow a brand.

Sarah Lewis, Global Director CTV at ShowHeroes Group

Data is available, it just needs to be harnessed correctly

Phil Acton

Beyond programme context, it’s not possible to serve truly personalised ads on CTV without knowing who is watching. Key to improving this experience will be integrating viewer information into the context. Data is available, it just needs to be harnessed correctly, and as an industry we need to push for a uniform taxonomy for defining content. 

Fortunately, AI is set to transform CTV advertising. Technology will soon be available that identifies users and reactions to content, while data will determine the best times to advertise to reach peak audiences. We’ll soon see significant advances in CTV advertising, so brands can really take advantage of this exciting channel. 

Philip Acton, UK country manager, Adform

We must be mindful of oversimplification

Peter Wallace GumGum

Emotional responses to video content can range wildly depending on what’s happening at that very moment in time. We might feel anxious as the killer zombies from Mars hurtle towards Earth to take over the human race, but then relief and happiness as our heroes save the day. Clearly, it’s fundamental that advertisers understand the current mindset of their audience if they are to deliver a message which will resonate.

In this way, contextual can be a hugely powerful tool in the CTV space. However we must be mindful of oversimplification. Content should not be pigeonholed into one singular categorisation. Advertisers need to use advanced contextual technology to understand each segment of the content in order to understand which message will be relevant at that moment. In so doing, advertisers can tap into mindset most effectively and drive vastly improved business outcomes.

Peter Wallace, general manager EMEA, GumGum

Contextual can open a multitude of opportunities for CTV

With CTV, advertisers can offer a more personalised experience than ever before. They can give viewers greater control over the video content they watch, allowing them to offer relevant and timely ads. It's no longer necessary for advertisers to rely on guesswork when targeting their audiences; now, they can actually see what their viewers want based on what they've watched before.

This intersection between CTV and contextual advertising will provide many opportunities for businesses who want to get their message out there. Advertisers can target specific demographics with their messages and better understand how well their campaigns are working by using programmatic to target specific audiences at scale, utilise data analytics tools to understand the content and context better and optimise ad targeting and messaging. 

Laura Quigley, SVP APAC, IAS

Contextual data is crucial for optimal efficacy

Alex Khan Smaato

Aligning creative to what audiences watch is a prerequisite for CTV advertising relevance, but optimal effectiveness depends on factoring in an additional contextual layer: variable human attention. Our observations have shown there are several systematic viewing patterns in the way real individuals consume media, each with a different mix of concentration cycles and peaks, and therefore different capacities to drive the desired outcomes for brands.

Maximising performance for any media means carefully configuring campaigns for the right environmental fit at multiple levels. Beyond simply matching ads to content, brands must ensure planning and buying accommodates the way it is actually viewed: adjusting to the unique shape of attention across every platform.

Alex Khan, executive vice president global partnerships, Amplified Intelligence