CTV is Ready to Compete with Digital
For years, the story of connected TV (CTV) has been framed as a migration — ad dollars shifting from linear to streaming as audiences move en masse. That’s still true. But the real story in 2025 isn’t about replacement. It’s about competition.
CTV is no longer simply absorbing TV budgets. It’s competing head-to-head with digital platforms (search, social, and display) for performance marketing dollars. And for the first time, it has the scale and measurability to make a strong case.
According to Nielsen’s latest Gauge report, streaming accounted for 44.8% of total TV usage in May, outpacing broadcast and cable combined for the first time ever.
The audience is already there. The question now is whether the ad industry will follow suit.
Digital dollars come with different expectations
To compete for digital budgets, CTV has to play by digital rules. That means performance, attribution, and ROAS. Traditional 15- and 30-second spots aren’t enough to meet those expectations. New formats and measurement strategies are needed to allow marketers to reach and convert high-intent audiences.
We’ve seen this shift begin to take shape, particularly in sports. Live sports remain one of the few shared cultural moments with mass reach, but they’ve historically been underleveraged as performance channels. Combine that with recent advances in targeting, creative execution, and real-time delivery, as demonstrated in this year’s NewFronts trends, and sports programming is becoming fertile ground for mid-funnel and lower-funnel activity.
In a study Transmit conducted with MAGNA Media Trials and IPG Media Lab, ad formats that appeared during live sports gameplay — including picture-in-picture and dynamic overlay units — were less intrusive and significantly more effective at driving brand recall, attention, and action. Among Gen Z and millennial viewers, in-game ads were overwhelmingly preferred to standard breaks, and 65% said they’d be open to seeing the same ad again.
These results show that when CTV leans into innovative, non-disruptive formats, it can meet, and even exceed, the performance expectations typically reserved for digital.
The saturation point for search and social
While this is happening, another trend is unfolding: diminishing returns in traditional digital media.
Most major brands have maxed out what they can spend efficiently on paid search and social. The incremental gains will shrink, CPMs will continue to rise, signal loss will further complicate attribution.
This opens the door for streaming to absorb some of that budget. It offers:
The premium feel of television
The scale and targeting of digital
And increasingly, the ability to measure results in real time
Early indicators are promising. In categories like quick service restaurants (QSR), we’re already seeing strong correlations between exposure and in-store traffic. Data from Foursquare shows a 3x in return on ad spend (ROAS) for QSR campaigns and average transactions 2.1x above the average QSR order size. In others, CTV exposure is directly influencing search queries and social engagement — often while viewers are still tuned in.
But to unlock this shift at scale, the industry needs more than anecdotal success. It needs a measurement framework that connects the dots across channels, from impression to action to outcome. And it needs more creative formats built to account for viewer behavior.
Reframing the CTV opportunity
Right now, the CTV ad market is still framed around an $80B TV pool. But if CTV can prove itself as a performance engine, it could access the much larger pool of digital advertising: more than $500B globally.
That’s the bigger opportunity: to move from substitution to expansion. Not to carve out a slightly bigger piece of the TV pie, but to claim a slice of the digital one.
To get there, we need to reframe how we think about the most valuable inventory in TV: live programming, especially sports. Not as a finite set of breaks or time slots, but as a stream of dynamic moments — stoppages, substitutions, halftime, replay delays — each of which represents an opportunity for connection, action, and value.
We need to move beyond streaming as just another distribution channel. It has the potential to be a new creative canvas, a forum to elevate what digital advertising can achieve.
The moment is now
For advertisers seeking performance, the path forward isn’t about choosing between TV and digital, but about recognizing that streaming has become both.
CTV has the audience and the addressability. It’s quickly building the measurement infrastructure needed to go toe-to-toe with the biggest digital platforms.
The only question that remains is whether brands are ready to replace their assumptions and give CTV a shot at being their next great performance channel.
[Editor's note: This is a contributed article from Transmit. Streaming Media accepts vendor bylines based solely on their value to our readers.]
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