OTT vs CTV Difference

If you’ve started exploring streaming advertising for your business, you’ve probably noticed that “OTT” and “CTV” get thrown around interchangeably. Marketing platforms blur the lines. Vendors use them as synonyms. Even industry articles sometimes treat them as the same thing.

They’re not. And when you’re spending real money on advertising, understanding the distinction matters.

The good news is that the difference isn’t complicated once you see it clearly. OTT refers to how content gets delivered. CTV refers to the device displaying it. That simple framework unlocks smarter advertising decisions for businesses of any size.

What Is OTT?

OTT stands for Over-The-Top, which describes video content delivered over the internet rather than through traditional cable or satellite connections. The name comes from the idea that this content goes “over the top” of existing infrastructure, bypassing the cable box entirely.

When you watch Netflix on your laptop, stream Hulu on your tablet, or pull up YouTube on your phone, you’re consuming OTT content. The defining characteristic is the delivery method: internet streaming rather than broadcast or cable transmission.

The major OTT platforms include subscription services like Netflix, Max, and Disney+, as well as ad-supported options like Tubi, Peacock, and Pluto TV. YouTube also falls into this category. What unites them is that they deliver video through an internet connection to whatever device you happen to be using.

What Is CTV?

CTV stands for Connected TV, and it refers specifically to television sets that connect to the internet. This includes smart TVs with built-in streaming capabilities, streaming devices like Roku and Amazon Fire TV, gaming consoles like PlayStation and Xbox, and set-top boxes like Apple TV.

The key distinction is that CTV describes the hardware, not the content. A CTV device is the physical screen in your living room that can access streaming content. When someone watches Hulu on their 65-inch smart TV, they’re using a CTV device to consume OTT content.

The Relationship Between OTT and CTV

Here’s the simplest way to think about it: OTT is what you watch, and CTV is what you watch it on.

All CTV viewing involves OTT content because connected televisions stream video over the internet. But not all OTT viewing happens on CTV devices. Someone watching Netflix on their smartphone or laptop is consuming OTT content without using a CTV device.

This distinction creates different advertising environments. A viewer watching on their phone is typically alone, in a personal space, and easily distracted. A viewer watching on their living room television is often in a shared environment, more engaged with the content, and watching on a much larger screen.

Why This Distinction Matters for Advertisers

For businesses considering streaming advertising, the OTT versus CTV distinction affects targeting capabilities, viewer behavior, and campaign costs.

CTV advertising delivers the traditional television experience: full-screen, non-skippable ads on the biggest screen in the household. Completion rates tend to be high because viewers are engaged and the content plays in an environment designed for focused watching. The premium nature of this placement typically commands higher CPMs, but brands benefit from the credibility that comes with television-quality presentation.

OTT advertising on non-CTV devices offers different advantages. Mobile and desktop placements allow for more granular individual targeting since these are personal devices rather than shared household screens. Cross-device retargeting becomes possible when you can follow a viewer from their living room television to their smartphone. Entry points for testing campaigns may be lower, making it accessible for businesses with modest budgets.

Most effective streaming campaigns combine both approaches, using CTV for awareness and brand building while leveraging OTT’s cross-device capabilities for retargeting and conversion.

Small Business Adoption Is Accelerating

The barriers that kept small businesses off television for decades are disappearing. Industry surveys show that over 40% of small businesses have either used CTV advertising or plan to within the next year, driven by self-serve platforms with entry points as low as $50 (Adwave).

The audience shift makes this timing critical. Streaming now commands 44.8% of all TV viewing in the United States, surpassing broadcast and cable combined for the first time (Nielsen, May 2025). With 90% of U.S. households owning at least one CTV device (MNTN), the reach rivals traditional television while offering targeting precision that broadcast never could.

The economics favor local advertisers. Research indicates that CTV can reduce local business acquisition costs by up to 40% compared to traditional TV advertising by eliminating wasted impressions on viewers outside the service area (AI Digital). Local CTV ad spending is projected to approach $3 billion in 2025, nearly tripling from 2020 levels (BIA Advisory Services).

Certain industries are leading adoption. According to BIA’s U.S. Local Advertising Forecast, key verticals driving local CTV growth include legal services, healthcare, and home services, all categories where geographic targeting and household-level reach align directly with business models (BIA Advisory Services).

How Home Services Businesses Use OTT and CTV

For home services companies like HVAC contractors, plumbers, and electricians, streaming advertising solves a persistent challenge: reaching homeowners in specific service areas with memorable brand messaging.

Consider how an HVAC company might structure a campaign. CTV ads running during evening streaming hours put the brand in front of homeowners in a premium environment. The living room television carries inherent credibility, and the full-screen format makes the message impossible to ignore. Geo-targeting ensures ads reach households within the company’s service area, eliminating wasted spend on viewers who could never become customers.

When one of those homeowners later picks up their phone to search for AC repair, cross-device OTT retargeting serves them a follow-up ad. The brand they saw on their television an hour ago now appears on their mobile device, reinforcing recognition at the exact moment they’re ready to make a decision.

Plumbers, electricians, and roofing contractors can apply similar strategies. The goal is to build brand awareness through CTV’s premium placements while leveraging OTT’s targeting capabilities to stay present throughout the customer’s decision process.

How Healthcare Practices Use OTT and CTV

Healthcare providers face unique advertising challenges. They need to build trust with potential patients, reach specific demographics within defined geographic areas, and maintain compliance with healthcare marketing regulations.

CTV advertising addresses several of these needs simultaneously. A dental practice running ads on premium streaming platforms benefits from the brand-safe environment these platforms provide. The full-screen television format conveys professionalism and credibility in ways that small banner ads simply cannot match.

Med spas and specialty practices can use addressable CTV to reach specific demographic profiles within their service area. Rather than buying broad reach and hoping the right people see the message, addressable targeting delivers ads to households matching specific criteria. A cosmetic dermatology practice might target households with income levels and demographic characteristics similar to those of its existing patient base.

The measurement capabilities of programmatic CTV also appeal to healthcare marketers who need to demonstrate return on investment. Unlike traditional television, streaming campaigns provide detailed reporting on reach, frequency, and viewer engagement.

Choosing Between OTT and CTV (Or Using Both)

For small businesses evaluating streaming advertising, the choice between OTT and CTV often comes down to goals and budget.

If brand awareness is the primary objective and the budget allows for premium placements, leaning into CTV makes sense. The television screen carries weight. Viewers pay attention. The association with professional content elevates brand perception.

If budget constraints require a more targeted approach, starting with OTT advertising on personal devices allows for precise audience targeting with lower minimum spends. Testing creative concepts and audience segments becomes more affordable, and the data gathered informs future expansion into CTV placements.

For most businesses, the best approach is a combination of both. CTV builds the awareness foundation. OTT extends reach across devices and enables the retargeting that drives conversions. The two work together as complementary pieces of a complete strategy rather than competing alternatives.

Local service businesses with defined geographic territories benefit enormously from geo-targeted CTV combined with cross-device retargeting. The combination ensures they reach the right households on the big screen while maintaining presence on mobile devices when those households start searching for services.

Getting Started Without Wasting Budget

The complexity of streaming advertising, from programmatic buying to audience targeting to cross-device attribution, creates real potential for wasted spend. Platforms, inventory types, targeting options, and measurement approaches multiply quickly, and the learning curve for doing it well is steep.

Working with a specialist who understands both the strategic possibilities and the technical execution helps businesses avoid expensive mistakes. The right partner brings access to premium inventory, expertise in audience targeting, and transparent reporting that shows exactly how campaigns perform.

Clicta Digital helps businesses across home services, healthcare, and other industries navigate OTT and CTV advertising with strategies designed for measurable results. From initial planning through ongoing optimization, having a partner who aligns their success with yours makes the difference between streaming advertising that works and a budget that disappears without impact.