Insights
July 02, 2025
How big is the CTV advertising market? (Q2 2025)
Table of Contents
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$33B
U.S. CTV advertising market size in 2025
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4x
Growth since 2020 (from $8B to $33B)
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13-15%
Annual CTV ad spend growth rate
The U.S. connected TV (CTV) advertising market is projected to reach $33.35 billion in 2025, according to eMarketer's latest forecast. This represents roughly four times the market size from just five years ago, when CTV advertising totaled approximately $8 billion in 2020. The explosive growth reflects a fundamental transformation in how Americans watch television and, consequently, how advertisers reach them. For small business owners who have long assumed TV advertising was beyond their reach, this expanding market creates unprecedented opportunities to access premium television inventory at accessible price points.
The scale of the CTV advertising market matters because it drives industry investment, platform development, and pricing dynamics. A larger market means more inventory, more sophisticated tools, better targeting options, and increased competition among platforms, all of which benefit advertisers of all sizes. Understanding where the market stands and where it's headed helps business owners make informed decisions about when and how to enter the CTV advertising space.
What the data shows
Multiple authoritative sources project continued strong growth for the CTV advertising market, with some variation in exact figures based on methodology and what each source includes in their definition of CTV.
According to various industry sources, here's how the CTV market has evolved and is projected to grow:
$8 billion in 2020: The baseline before the streaming advertising boom accelerated
$20.3 billion in 2023: Market nearly tripled in three years (IAB)
$23.6 billion in 2024: 16% year-over-year growth according to IAB's Digital Video Report
$26.6 billion in 2025: IAB's projection for CTV ad spend this year
$33.35 billion in 2025: eMarketer's projection for CTV display ad spending (a broader measure)
$42.4 billion by 2027: Projected trajectory according to OnAudience's analysis
$46.89 billion by 2028: eMarketer's forecast for total CTV ad spending
The difference between IAB and eMarketer numbers reflects methodology. IAB tracks advertiser-reported spend across a sample of major brands, while eMarketer provides broader market forecasts that include the full ecosystem. Both point to the same directional story: double-digit annual growth that's reshaping the television advertising industry.
To contextualize these numbers, eMarketer reports that CTV ad spending will surpass traditional TV ad spending ($45.10 billion) for the first time in 2028. This crossover point marks a historic shift in how television advertising dollars flow. The medium that dominated advertising for decades is being overtaken by its streaming successor.
The IAB reports that digital video as a whole, which includes CTV, social video, and online video, rose 18% in 2024 to $64 billion and is projected to reach $72 billion in 2025. This growth rate is two to three times faster than total media spending overall. CTV represents the fastest-growing segment within digital video, reflecting advertisers' enthusiasm for reaching cord-cutters and streaming audiences.
Breaking down the numbers
Understanding what's driving the CTV market's growth and how the dollars are distributed provides valuable context for advertisers considering the channel.
Growth drivers
Several converging factors fuel CTV advertising's expansion. First, the launch of ad-supported tiers from major streaming services has dramatically increased available advertising inventory. Netflix launched its ad tier in late 2022, followed by Disney+, and Amazon Prime Video introduced ads to its base tier in 2024. These additions alone created billions of dollars in new advertising inventory.
Second, ongoing cord-cutting continues pushing viewers away from traditional TV advertising. As we've documented in our cord-cutting statistics, over 80 million American households have either cut the cord or never subscribed to traditional pay TV. These viewers haven't stopped watching content; they've shifted to streaming, and CTV advertising is how advertisers reach them.
Third, measurement improvements have increased advertiser confidence. CTV offers more precise impression tracking than traditional TV's estimated ratings. Advertisers can verify their ads were actually delivered, measure completion rates, and increasingly connect exposure to outcomes. This accountability attracts digital-first advertisers who expect measurable results.
Fourth, the rise of self-serve and programmatic tools has democratized access. IAB notes that "CTV is no longer just for brands with big budgets" due to self-serve platforms that enable small and mid-size businesses to participate. This expansion of the advertiser base drives market growth beyond traditional TV buyers.
Market share by platform
The CTV advertising market is more fragmented than social media advertising, where Meta dominates. According to eMarketer, only three companies will account for more than 10% of CTV ad sales in 2026:
YouTube: 11.9% of CTV ad revenues (24.4% of gross sales at $9.21 billion)
Amazon: Surpassing 10% through Prime Video, Fire TV, Twitch, and Freevee
Disney: 10.8% combined across Hulu and Disney+
This fragmentation creates opportunities for advertisers. Unlike social advertising where a few platforms dominate, CTV offers multiple entry points and diverse inventory sources. Platforms like Adwave aggregate access to 100+ channels, allowing advertisers to reach audiences across the entire streaming ecosystem without managing multiple platform relationships.
Where CTV dollars are coming from
The IAB reports that most dollars flowing into CTV represent reallocations from other channels rather than purely incremental spend. The primary sources are:
Linear TV (36%): Traditional TV advertisers shifting budget to follow audiences to streaming
Social media (36%): Digital advertisers adding CTV for its brand-building capabilities
Other digital (remaining): Including online video, paid search, and display
This reallocation pattern suggests advertisers are treating CTV as a core channel rather than an experimental add-on. For businesses already advertising on Meta or other social platforms, CTV offers complementary reach and brand-building impact.
CPM and pricing trends
As the CTV market has grown, pricing has become more competitive. Current CTV CPMs range from $15-35 for small business advertisers, with an average around $25. This represents a significant improvement from the early days of CTV when premium rates and high minimums excluded smaller advertisers.
The increase in inventory from ad-supported streaming tiers has moderated CPM growth. While premium inventory on Netflix or Disney+ commands higher rates, the overall market offers accessible pricing for businesses of all sizes. Platforms like Adwave start at just $50, making TV advertising achievable for businesses that couldn't previously afford it.
Why it matters for your business
The expanding CTV advertising market creates tangible benefits for small business advertisers, even if you're not planning to spend millions on advertising.
More inventory means better access
A $33 billion market requires substantial advertising inventory to absorb that spending. This inventory growth works in advertisers' favor. More available ad slots mean less competition for any individual placement, which helps moderate pricing and improves the likelihood of reaching your target audience. Five years ago, CTV inventory was relatively scarce and expensive. Today, the proliferation of ad-supported streaming options creates abundance.
Platform investment benefits all users
The scale of CTV spending attracts investment in platform capabilities. Ad technology companies build better targeting tools, measurement solutions, and creative capabilities because the market size justifies the investment. Small advertisers benefit from these improvements even though enterprise budgets drove the investment.
Consider how AI-powered creative generation has emerged. Creating a TV commercial used to require production budgets of $5,000 to $50,000 or more. Now, platforms like Adwave can generate professional ads from your website assets at no additional cost. This innovation exists because the CTV market's scale justified the development investment.
Validation and maturity
A $33 billion market isn't experimental. When major brands allocate significant budgets to CTV, they validate the channel's effectiveness. When measurement firms develop sophisticated attribution solutions, they confirm the medium delivers results. For businesses considering TV advertising for the first time, the market's maturity provides confidence that you're not taking an unnecessary risk.
The market size also ensures longevity. CTV isn't a fad that will disappear; it's the future of television advertising. Investing time to understand and test the channel now positions your business well for the long term.
Timing advantages
Entering a growing market often provides advantages over waiting. As more advertisers discover CTV, competition for the best inventory will increase. Establishing your presence now, while the market is still developing and smaller advertisers have good access, may be more advantageous than waiting until the market becomes more crowded.
Additionally, the learnings you accumulate from early campaigns, such as which targeting works, what creative resonates, and how CTV fits your overall marketing mix, compound over time. Businesses that start now build institutional knowledge that late entrants won't have.
How to take advantage of this trend
The CTV market's growth creates opportunity, but capturing that opportunity requires action. Here's how small businesses can participate in this expanding market.
Start with accessible platforms
Direct relationships with streaming services like Netflix or Hulu typically require substantial minimum commitments. Self-serve platforms like Adwave aggregate inventory across 100+ channels, offering access to the same premium inventory with minimums starting at $50. This approach lets you test CTV without major budget commitments.
Look for platforms that offer geographic targeting (for local businesses), audience targeting, and transparent pricing. The proliferation of self-serve options means you have choices; select one that fits your specific needs and budget.
Allocate test budget appropriately
For initial CTV testing, consider allocating $200-$500 over two to four weeks. This budget provides enough impressions to gauge whether CTV drives meaningful results for your business while limiting risk. Successful tests can be scaled; unsuccessful ones provide learning without major financial impact.
If you're currently spending on social or search advertising, consider reallocating a small percentage (5-10%) to CTV testing rather than adding purely incremental budget. This approach mirrors how larger advertisers are moving dollars into the channel.
Leverage AI creative tools
One of the biggest barriers to TV advertising has traditionally been creative production. AI-powered platforms now eliminate this barrier. By providing your website URL, social media profiles, or existing assets, you can generate professional TV commercials in minutes. This technology democratizes access to TV-quality creative that previously required substantial production investment.
The AI creative approach also enables testing. Generate multiple versions, see what resonates, and iterate quickly. This agility wasn't possible when each creative required weeks of production time.
Connect CTV to your broader strategy
CTV advertising works best as part of an integrated marketing approach. Consider how it complements your existing channels. CTV builds awareness and consideration; digital channels can capture the resulting demand. Many advertisers use CTV to drive brand searches, then capture those searches through paid search or SEO.
For local businesses, CTV's geographic targeting enables television advertising within your specific service area. Combined with local TV advertising strategies, you can build local brand presence that supports all your marketing efforts.
The bigger picture
The CTV market's growth reflects broader transformations in media consumption and advertising that will continue shaping opportunities for years to come.
The streaming transformation is permanent
Viewers aren't returning to traditional cable. Each year, more households cut the cord, and younger generations have never subscribed to traditional pay TV. The streaming share of TV viewing continues growing, meaning CTV's importance will only increase.
For advertisers, this means CTV literacy isn't optional. Understanding how to reach streaming audiences, measure results, and integrate CTV with other channels is becoming a core marketing competency. The businesses that develop this capability position themselves well for a streaming-dominant future.
Traditional TV isn't disappearing immediately
While CTV grows, traditional TV advertising continues at scale. The projected 2028 crossover point when CTV surpasses traditional TV still leaves traditional advertising as a $45+ billion market. For some audiences, particularly older demographics and sports viewers, traditional TV remains relevant.
The implication for advertisers is nuanced. CTV represents the growth opportunity, but traditional TV shouldn't be dismissed entirely for audiences where it remains effective. The most sophisticated advertisers use both, allocating based on audience composition and campaign objectives.
Market maturity brings new challenges
As the CTV market matures, new challenges emerge. Fragmentation across platforms requires either aggregated buying approaches or complex multi-platform management. Measurement standardization is improving but not yet solved. Brand safety in automated buying environments requires attention.
These challenges don't diminish CTV's opportunity; they highlight the importance of working with platforms and partners who address them effectively. Self-serve platforms that aggregate inventory, provide transparent reporting, and maintain brand safety standards help advertisers navigate market complexity.
International expansion
While this analysis focuses on the U.S. market, CTV advertising is growing globally. International expansion creates additional inventory and accelerates platform investment. For businesses with international customers or expansion ambitions, CTV capabilities in other markets are developing rapidly.
What experts are saying
Industry analysts and marketing experts have taken note of CTV's growth trajectory, offering perspectives on what it means for advertisers.
David Cohen, CEO of the IAB, stated that "2024 was a pivotal year for digital video advertising. With high-quality content moving to streaming, advancements in advertising technology, and an influx of new inventory accelerated growth for both consumers and advertisers."
Chris Bruderle, VP of Industry Insights at IAB, noted that "CTV and social video are core pillars of a brand's comprehensive and integrated media strategy. Consumer attention has already moved to these platforms, and advertisers are meeting them there, not just for the scale, but for the ability to precisely target, measure performance across devices, and drive real business outcomes."
eMarketer's analysis highlights that CTV "will surpass traditional TV ad spending for the first time" in 2028, marking a historic transition in television advertising. The analysis notes that YouTube, Amazon, and Disney are emerging as the major platforms, but the market remains more fragmented than social advertising.
Common questions answered
How big is the CTV advertising market in 2025?
The U.S. CTV advertising market is projected at $26.6 billion to $33.35 billion in 2025, depending on the source and methodology. IAB projects $26.6 billion based on advertiser-reported data, while eMarketer forecasts $33.35 billion including the broader ecosystem. Both represent double-digit growth from 2024 and approximately four times the market size from 2020.
Is CTV advertising still growing?
Yes, CTV advertising continues growing at double-digit rates. IAB reports 16% year-over-year growth in 2024, and projections show continued growth through the forecast period. The market is expected to reach $42-47 billion by 2027-2028. Growth is driven by streaming adoption, ad-supported tier launches, and advertiser migration from traditional TV.
When will CTV surpass traditional TV advertising?
eMarketer projects CTV ad spending will surpass traditional TV ad spending for the first time in 2028. At that point, CTV is projected to reach approximately $46.89 billion while traditional TV advertising is expected to be around $45.10 billion. This crossover represents a historic shift in television advertising economics.
What's driving CTV market growth?
Multiple factors drive growth: continued cord-cutting shifting viewers to streaming, major streaming services launching ad-supported tiers (Netflix, Disney+, Amazon Prime Video), improved measurement and targeting capabilities, and self-serve platforms making CTV accessible to smaller advertisers. The IAB notes that 36% of CTV dollars are reallocated from linear TV and another 36% from social media.
Can small businesses participate in the CTV market?
Yes, self-serve platforms have democratized CTV access. While direct streaming service relationships may require substantial minimums, aggregated platforms like Adwave provide access to premium inventory starting at $50. The IAB specifically notes that "CTV is no longer just for brands with big budgets" due to these accessibility improvements.
Which companies control the CTV advertising market?
The market is more fragmented than social advertising. YouTube leads with approximately 11.9% of CTV ad revenues (24.4% of gross sales), followed by Amazon (surpassing 10% through Prime Video, Fire TV, and other properties) and Disney (10.8% combined across Hulu and Disney+). No single platform dominates, creating opportunities for advertisers to access diverse inventory sources.
How does CTV market size compare to social media advertising?
Despite CTV's rapid growth, social video advertising remains larger. eMarketer notes that in 2026, Meta alone will account for over $10 billion more in video ad spending ($48.77 billion) than all of CTV combined ($37.70 billion). However, CTV is growing faster than social video and serves different advertising objectives, particularly brand building.
What does CTV market growth mean for advertising costs?
Increased inventory from market growth has helped moderate CPM increases. Current CTV CPMs range from $15-35, averaging around $25 for small business advertisers. While premium inventory commands higher rates, the overall market offers competitive pricing. Increased supply from ad-supported streaming tiers creates pricing pressure that benefits advertisers.
How is the CTV market different from traditional TV advertising?
The CTV market differs from traditional TV in several important ways. Traditional TV advertising is sold primarily through upfront commitments and scatter market purchases, with pricing based on estimated ratings. CTV advertising is largely programmatic, with pricing based on verified impressions and precise audience targeting. Traditional TV offers broad reach but limited targeting; CTV enables demographic, geographic, and behavioral targeting comparable to digital channels. Traditional TV measurement relies on panel-based estimates; CTV provides deterministic impression tracking. These differences make CTV more accessible to smaller advertisers and more accountable to all advertisers.
What verticals are investing most heavily in CTV?
According to IAB, consumer packaged goods (CPG), retail, and pharmaceutical companies are leading CTV investment, with projected increases of 13%, 18%, and 19% respectively in 2025. These categories value CTV's combination of TV's brand-building impact with digital's targeting and measurement capabilities. Retail advertisers particularly benefit from shoppable ad formats emerging on CTV platforms. Other growing verticals include automotive, financial services, and direct-to-consumer brands seeking efficient awareness building.
What role does live programming play in CTV market growth?
Live programming, particularly sports, is becoming a significant driver of CTV advertising growth. BCG estimates live CTV ad spending alone is reaching $8-9 billion in 2025, with projections of $5+ billion in additional growth coming from live programming. As sports rights increasingly move to streaming platforms (Amazon's Thursday Night Football, Peacock's exclusive NFL games, Apple TV+'s MLB coverage), advertisers follow. Live programming offers the engagement and appointment viewing that streaming on-demand content sometimes lacks, making it particularly valuable inventory.
How should businesses approach CTV budget allocation?
For businesses new to CTV, start with test budgets of $200-$500 to establish baseline performance before committing larger amounts. As you gather data, consider allocating 10-20% of your total TV/video budget to CTV if you're already advertising on traditional TV. If CTV is your first TV advertising experience, start with the test budget approach and scale based on results. The IAB reports that advertisers are reallocating equally from linear TV and social media, suggesting CTV can complement both channels effectively.
Supporting data
Additional statistics that contextualize the CTV advertising market:
$64 billion: Total digital video ad spend in 2024 (IAB)
$72 billion: Projected digital video ad spend in 2025 (IAB)
60%: Share of total TV/video ad spend going to digital video in 2025 (IAB)
16%: CTV year-over-year growth rate in 2024 (IAB)
98.4%: Share of CTV display ad dollars going to video ads (eMarketer)
36%: Share of CTV dollars reallocated from linear TV (IAB)
36%: Share of CTV dollars reallocated from social media (IAB)
2028: Year CTV is projected to surpass traditional TV ad spending (eMarketer)
$15-35: Current CTV CPM range for small business advertisers
$50: Minimum budget to start CTV advertising on platforms like Adwave
Data sources:
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