Which performs better: Connected TV (CTV) or Display Ads? It depends on your goals. CTV excels at building brand awareness with high video completion rates (90–98%) and precise targeting, but tracking direct conversions can be challenging. Display Ads, on the other hand, are better for driving immediate actions due to clickable elements and lower costs.

Key Takeaways:

• CTV Strengths: High engagement, strong brand recall, and household-level targeting.

• Display Ad Strengths: Cost-effective, direct-response capabilities, and precise user targeting.

• Challenges: CTV struggles with attribution across devices, while Display Ads face issues like ad fatigue and low engagement rates.

• Best Use: Combine both. Use CTV for awareness and Display Ads for retargeting to create a seamless conversion journey.

Quick Comparison:

Bottom Line: Use CTV for awareness and Display Ads for conversions. Together, they create a balanced, effective advertising strategy.

Breakout: Connected TV, Connected Commerce: Winning in the Digital Living Room

Connected TV: Conversion Performance Analysis

Connected TV (CTV) has emerged as a powerful tool for driving conversions, offering advertisers measurable outcomes. While it operates differently from traditional digital channels, its distinct advantages open up new opportunities to engage audiences and inspire action.

Connected TV Advantages

One standout feature of CTV advertising is its exceptional video completion rates, which range from 90–98%. This far surpasses platforms like YouTube, where completion rates hover between 20–40%, and social media videos, which often fall below 30%. With such high engagement, advertisers can deliver their full message, paving the way for stronger brand recall and higher conversion potential.

CTV also excels in precise targeting. Advertisers can reach households based on demographics, interests, and viewing habits. This level of accuracy reduces wasted impressions and ensures that conversion-driven messages reach audiences most likely to act. Additionally, the immersive experience of watching on a big screen in a living room setting enhances the quality of engagement, making conversions more likely.

Performance data highlights CTV's effectiveness in driving results. For example, mid-roll CTV ads boast conversion rates as high as 16.95%, compared to just 3.15% for pre-roll ads. Moreover, CTV campaigns deliver around 23% higher ROI than linear TV and up to 30% stronger ROI compared to average advertising channels. A retail brand even discovered that allocating just 7% of its budget to CTV generated 30% higher returns than other channels. The programmatic nature of CTV buying further strengthens its appeal, allowing advertisers to optimize campaigns in real-time and allocate budgets to high-performing audience segments. Despite these advantages, advertisers must navigate certain challenges, particularly in attribution and creative production.

CTV Conversion Measurement Challenges

While CTV offers impressive engagement, measuring its impact comes with its own set of hurdles. One significant challenge is attribution complexity, especially when tracking user journeys across devices and platforms. Unlike display ads, where users often click and convert on the same device, CTV viewers typically see ads on their TVs but complete conversions on other devices like smartphones or computers. This cross-device behavior calls for advanced attribution solutions to accurately connect the dots.

Another issue is the cost and effort of creative production. CTV’s cinematic environment demands high-quality video content, which can be more expensive and time-intensive to produce. Advertisers also face difficulties in maintaining consistent attribution models across various streaming platforms, leading to challenges in measurement and frequency capping.

Despite these obstacles, the industry is making strides toward better solutions. The growing popularity of ad-supported streaming platforms and the push for unified measurement standards are expected to improve CTV's reliability as a conversion-driving channel. Many advertisers are already addressing these challenges by combining CTV with display retargeting strategies. This approach uses CTV ads to build awareness while display ads capture conversions from viewers who have already been exposed to the message.

Display Ads: Conversion Performance Analysis

Display advertising continues to play a vital role in digital marketing, offering a direct path to conversions through strategic targeting and placement. Unlike other ad formats, display ads are particularly effective at reaching users who are ready to act, making them a go-to option for driving immediate results.

Display Ad Conversion Benefits

One of the standout advantages of display ads is their affordability. Compared to search advertising, display campaigns often have lower cost-per-click rates, enabling businesses to stretch their budgets while maintaining conversion rates. This makes them an appealing choice for companies ranging from small startups entering new markets to larger enterprises looking to scale their efforts.

Another major strength is their broad audience reach. Display networks span millions of websites, apps, and platforms, allowing advertisers to engage users across virtually every corner of the internet. Whether someone is reading an article, scrolling through social media, or researching a product, display ads can meet them where they are, creating countless opportunities for conversions.

Display ads also shine in their direct-response capabilities. These ads can feature clear calls-to-action, product visuals, pricing details, and links that lead straight to purchase pages. This streamlined approach allows users to take action immediately without unnecessary steps or switching devices.

The effectiveness of retargeting is another key advantage. Display ads can re-engage users who have already shown interest in a product or service by delivering tailored messages based on their previous interactions. These audiences, often referred to as "warm leads", are more likely to convert since they’ve already demonstrated intent.

Precise audience segmentation further boosts conversions by ensuring that ads are shown to users most likely to take action. This level of targeting helps advertisers focus their efforts where they’re most effective.

Lastly, real-time optimization is a game-changer. Display platforms provide detailed analytics that highlight which creatives, audience segments, and placements are performing best. This data allows advertisers to make adjustments on the fly, improving campaign results as they go.

While these benefits make display ads a powerful tool for conversions, they’re not without their challenges.

Display Ad Limitations

Despite their strengths, display ads face several obstacles that can impact performance. One of the most prominent issues is ad blindness. Many internet users have become adept at mentally tuning out banner ads, making it harder for advertisers to capture their attention. This trend has only grown as online advertising becomes more ubiquitous.

Another limitation is low engagement rates compared to formats like video or interactive content. While display ads can reach a wide audience, they often struggle to hold attention or inspire action, which can limit their conversion potential.

Viewability concerns also present a major hurdle. Studies have shown that a significant number of display ads are never actually seen by users. Whether due to placement below the fold, rapid page scrolling, or technical glitches, ads that go unnoticed can’t drive conversions.

The issue of ad fraud further complicates matters. Bots, click farms, and fraudulent websites can inflate metrics like impressions and clicks, wasting ad budgets and distorting performance data. This makes it harder to optimize campaigns effectively.

Banner fatigue is another challenge, occurring when users are exposed to the same types of ads repeatedly. Over time, this oversaturation can lead to declining performance, requiring advertisers to frequently refresh their creatives and experiment with new formats.

Finally, competition for attention is fierce. With so many advertisers vying for the same ad placements and audiences, costs can rise, and individual campaigns may struggle to stand out. Premium placements on popular websites often come with higher price tags, making it harder to achieve cost-efficient results.

Understanding these strengths and challenges sets the stage for evaluating how display ads perform in comparison to other channels and how they can work together for maximum impact.

CTV vs Display Ads: Performance Comparison

Connected TV (CTV) and Display Ads shine in different areas of the marketing funnel. Each serves a unique purpose, and their effectiveness hinges on your campaign goals and how performance is measured.

Key Metric Comparison

To understand how these two channels perform, let’s break it down by key metrics:

This table highlights how each channel stacks up across critical performance metrics.

Display ads are ideal for tracking direct actions, like a user clicking on an ad and completing a purchase. On the other hand, CTV focuses on building awareness and driving consideration. While its conversions aren’t as immediate or easy to track, they often play out over time through advanced attribution models. These models connect TV ad exposure to later actions, such as visiting a website or making a purchase.

Cost differences are also noteworthy. CTV commands a premium for its high-quality, immersive experience, while display ads are generally more accessible for those with smaller budgets.

Which Channel Converts Better?

The answer depends on how you define and measure conversions. Display ads often show higher immediate conversion rates because users can click directly on an ad, visit a landing page, and take action. In contrast, CTV conversions tend to happen over a longer timeline. A viewer might see a CTV ad, become interested, and later engage with the brand on another device.

CTV is particularly effective at reaching new audiences and building awareness through engaging video content. Meanwhile, display ads are better for driving quick actions, especially among users who already know the brand.

How CTV and Display Ads Work Together

Instead of viewing CTV and display ads as competitors, think of them as complementary tools in a broader strategy. Each channel has strengths that can offset the other’s limitations when used together.

For example, you can use CTV to create awareness and grab attention with compelling video content. Then, follow up with display ads to retarget those viewers and guide them toward conversion. This sequential approach helps address the attribution challenges often associated with CTV.

Cross-device coordination strengthens this strategy even more. A potential customer might see a CTV ad on their television, then later encounter a related display ad on their smartphone or laptop. This consistent messaging across platforms helps move them from interest to action.

To make the most of these channels, consider a balanced budget. Allocate resources to CTV for awareness and brand-building while using display ads to drive conversions. Regular reporting and optimization will help you measure the combined impact and refine your approach over time.

Best Practices for Programmatic Campaign Success

Achieving success with programmatic campaigns involves careful planning, effective execution, and ongoing optimization to boost conversions and maximize ROI.

How to Combine CTV and Display Ads

Bringing together CTV (Connected TV) and display ads can create a powerful, unified strategy for driving conversions. The key lies in cross-channel retargeting: CTV ads, with their high completion rates, build brand awareness, while display ads re-engage those same viewers with direct-response messaging. This combination often delivers better results than running these channels separately.

Audience segmentation plays a big role here. Tailor your messaging based on how users interact with your ads. For example, someone who watches an entire CTV ad might receive a different follow-up message than someone who only sees part of it.

It’s also important to design creatives that fit each platform. CTV ads should feel cinematic, offering a premium viewing experience with longer storytelling formats. On the other hand, display ads should use dynamic visuals and clear calls-to-action to encourage immediate engagement.

Timing and frequency matter, too. Use frequency caps to avoid overwhelming your audience as CTV inventory expands. This keeps your brand visible without causing ad fatigue. Together, these strategies lay the groundwork for precise reporting and ongoing improvements.

Importance of Reporting and Optimization

Real-time reporting and optimization are essential for programmatic success. Both CTV and display ads generate valuable data that can guide mid-campaign adjustments, helping you cut unnecessary spending and improve performance.

Your metrics should match your campaign goals. For CTV, focus on completion and conversion rates. In contrast, display ads often have lower conversion rates (under 1%), so it’s crucial to also monitor engagement and click-through rates.

Closed-loop attribution is another must-have. This approach directly ties ad spend to conversions, showing how CTV exposure influences user actions. With 70–75% of CTV ad transactions now happening programmatically, detailed tracking like this has become the norm.

Given how fast the programmatic space evolves, review performance weekly or bi-weekly. Regular check-ins allow you to seize opportunities and address any underperforming areas quickly.

OTHERSIDE's Programmatic Advertising Solutions

OTHERSIDE takes these best practices and streamlines them through its advanced platform. The Nexus Engine™ leverages real-time data from over 400 targeting partners to fine-tune targeting, creative rotation, and budget allocation across channels.

The platform automatically adjusts bids, placements, and creative delivery based on performance insights, helping to improve conversion rates and make ad spending more efficient.

Its cross-channel retargeting capabilities are particularly effective. Users who see your CTV ads are automatically added to retargeting pools for display campaigns, creating a seamless journey from brand awareness to conversion - all without manual effort.

The platform is built to scale, whether you’re running a small test or a national campaign. It provides access to premium CTV inventory and extensive display reach, ensuring your ads connect with the right audience.

OTHERSIDE also offers a hands-on service model. Dedicated account managers, transparent reporting through private Slack channels, and a quick campaign launch timeline (within seven days) ensure smooth execution. This combination of advanced tech and expert support helps businesses implement integrated CTV and display strategies with confidence.

With CTV ad spending expected to hit $32.57 billion by 2025, having the right tools and expertise to execute these campaigns is more important than ever.

Conclusion: CTV and Display Ads Key Takeaways

Looking back at the analysis, it’s clear that both CTV and display ads serve unique purposes within the conversion funnel. While no single channel dominates on its own, each shines in specific areas - CTV drives awareness and ROI, while display ads excel in direct response and retargeting. In the retail sector alone, display ads make up 25% of U.S. display ad spending, highlighting their importance in driving conversions.

When combined, these channels create a powerful synergy. CTV generates initial awareness and sparks interest, while display ads follow up with precise retargeting to guide users toward action. Blending the broad reach of CTV with the targeted nature of display ads results in a more comprehensive and effective advertising strategy.

The programmatic ecosystem is well-positioned to support this integration. With 70–75% of CTV transactions expected to be programmatic and 57% of U.S. CTV users preferring CTV ads over traditional linear TV ads, the tools and infrastructure are already in place for seamless, unified campaigns.

To get the best results, use CTV for brand awareness and storytelling, leveraging its large-screen, non-skippable format to leave a lasting impression. Then, capitalize on display ads to deliver personalized, actionable messages that drive conversions. This combination allows you to play to the strengths of each channel while addressing their individual weaknesses.

Finally, unified measurement and real-time optimization are essential. By using cross-device attribution, maintaining consistent messaging, and making data-driven adjustments, you can ensure your campaigns perform at their peak. Together, CTV and display ads can deliver the kind of results that industry data consistently supports.

FAQs

×How can advertisers track and measure conversions from Connected TV ads despite attribution challenges?Advertisers can track conversions from Connected TV (CTV) ads by using advanced methods that link user activity across various devices and platforms. This often involves combining data from multiple sources and using probabilistic or deterministic matching to connect ad impressions to resulting conversions.On top of that, tools that tie online interactions to offline outcomes can offer more precise insights. By applying effective measurement strategies and utilizing cutting-edge tracking tools, advertisers can tackle attribution hurdles and gain a better grasp of how their campaigns are performing.

×How can you prevent ad fatigue in display advertising?To keep your display ads from wearing out their welcome, it's important to switch things up. Regularly refresh your ad creatives and rotate several variations to keep the content engaging. Use frequency caps to limit how often users see the same ad, preventing overexposure. Additionally, broadening your audience segments can reduce repetitive targeting. Together, these tactics help sustain interest and boost your campaign's effectiveness.

×How does combining Connected TV and display ads improve advertising campaign results?Combining Connected TV and display ads can lead to a stronger advertising strategy by playing to the strengths of each platform. Connected TV is great for building brand awareness and grabbing the attention of specific audiences, while display ads shine when it comes to retargeting and driving conversions.Here’s how it works: Connected TV draws viewers in, creating interest and driving qualified traffic. From there, display ads step in to re-engage those same viewers, nudging them toward taking action and completing conversions. Together, these two channels work hand-in-hand to create a smooth marketing funnel, increasing engagement and improving ROI.