Connected TV Advertising Targeting: Everything You Need to Know

In today’s digital age, Connected Television (CTV) advertising (or Streaming TV Advertising) has proven to be an effective way for businesses to reach their desired audience with accuracy.

But how is this targeting actually done, and why is it so effective? Let us learn more about CTV advertising targeting in detail.

Understanding Connected TV Advertising Targeting

Connected TV advertising truly shines when it comes to slicing and dicing audiences that will blow your mind.

Your audience targeting can be as wide (Adults 25-54) or as tightly targeted (Adults 25-54 with a household income of over $250K per year who own a Mercedes-Benz) as you require it to be, depending on your business and which CTV platform you are using.

What is truly attractive with CTV advertising is that you’re only paying for delivery to the right audience, without wastage on viewers who are not in your demographic profile for your brand or product.

Types of CTV Targeting Options

Remember that not all platforms offer the same level of targeting capabilities. For example, platforms like Hulu may not offer the extensive targeting capabilities described below. Let’s go through the ways in which you could potentially build your target audience.

1. Location-Based Targeting

This is a simple targeting option whereby you define the geographical area of your ads. All platforms offer some form of location-based targeting, including:

Neighborhoods
Zip codes
Voting districts
Cities
Counties
States
Countries
Custom radius around a specific point

You can make it as wide as all of the people in a nation or narrow down to certain zip codes in a city or county.

2. Demographic Targeting

Demographic targeting is factual information about the home or the individual. Some websites have only general targeting capabilities, while some permit deep demographic drilling. These are:

Age
Gender
Education
Household Income
Marital Status
Parental Status
Pets
Ethnicity
Occupation

3. Geofencing

Geofencing is worthy of its own section apart from overall location-based targeting since it’s frequently confused. Real geofencing enables you to geographically target as low as a home, building, or parking lot. Once the person enters this hand-drawn area, they become available to start seeing your ads.

4. Addressable Geofencing

Addressable geofencing incorporates demographic into geographic targeting. So, if you want to reach registered nurses in East Texas, for example, the platform would locate homes where data provides the most certainty that a nurse lives and begin showing your ads on these homes’ connected TV devices.

5. First-Party Data Geofencing Addressable

This powerful targeting feature allows you to leverage your own customer data:

Upload physical addresses of current clients
Create “lookalike lists” that mirror your existing customer base
Follow up on direct mail campaigns with connected TV ads
Target people with similar attributes to your best customers

6. Behavioral / In-Market Targeting

This targeting addresses current signals people are sending about probable purchases. For instance:

In the market to buy a car
Searching for specific products like zero-turn lawn mowers
Demonstrating purchase intent through online behavior

7. Affinity / Interest Targeting

Affinity targeting aims at viewers based on interest and pastime. For example:

NFL Fans
Motorcycle enthusiasts
Cooking aficionados
Outdoor adventurers

It is particularly valuable for companies that are aligned with specific interests. A motorcycle repair shop, for example, would find it highly valuable to target motorcycle enthusiasts who own motorcycles.

8. Keyword Contextual Targeting

It is search-based targeting that generally occurs outside of search engines (if your platform doesn’t include search engine data) and also as the person visits different pages within a website. For example:

A person who searches for “lawn mower” on Home Depot’s website
Product searches on retail websites
Content searches on specific platforms
A person visiting the “office desk” section of Staples website

9. Website Retargeting Audience

On most platforms, you can retarget website visitors:

Place a pixel on your website to track visitors
Create custom audiences from site engagement
Set up retargeting timelines
Create ads to turn off after a conversion action is completed

10. Event-Based Targeting

Event-based targeting introduces time elements to geofencing:

Target users who are at specific places during events
Leave them exposed to ads for a specific period of time (e.g., 30 days) after they’ve been there
Build audiences by event attendance

As a case in point, a running shoe store can target runners from every 5K run in 10 miles all year round and build an active user audience perfectly suited for their product.

11. Device-Based Targeting

As we’re talking about Connected TV advertising, remember that these campaigns are cross-device:

Connected TVs
Mobile phones
Tablets
Any combination of devices

You can choose which devices your ads are served to, whether that is just TVs or a multi-device approach.

Building Your Ideal CTV Ad Audience with Combination Targeting

Where CTV advertising really becomes strong is when you begin combining these targeting choices. Here is an example:

If you are a motorcycle customization company in Richmond, Virginia, your ideal audience might be:

Males 35-65
Living within a 50-mile radius of Richmond, Virginia
Self-identified as motorcycle enthusiasts
Having a household income of $200K or more annually

This combination of demographic, geographic, and interest-based targeting goes a long way in ensuring your message reaches the most relevant prospective customers.

Best Practices for CTV Advertising Targeting

Start with established campaign objectives
Test multiple targeting combinations
Measure and optimize for performance
Balance precision and reach
Consider seasonality factors
Regular review and adjustment of targeting parameters

The Balance of Targeting: Over-Targeting

Avoid this common mistake that can limit reach and reduce impact.

While CTV advertising has high targeting power, you must maintain it in moderation. You can set your targeting parameters so constrictive that very few people meet all the parameters, which limits your campaign’s reach.

The secret is to find a balance between targeted specificity and sufficient volume.

There is nothing bad about expanding your targeting parameters slightly to get more volume, as long as you are not going so wide that you are spending money on untargeted people. The best practice is to start with your ideal targeting criteria and then adjust based on volume and performance metrics.

Understanding CTV Spend How Targeting Can Impact Them

Connected TV advertising is impressions-based on CPM (Cost Per Thousand Impressions), which means you’re paying a fixed amount for each 1,000 impressions your ad receives from your target audience. It should be kept in mind that the more targeted your targeting, the higher your CPM is going to be.

For example, the mass targeting of all adults 25-54 will typically be a cheaper CPM than to target a very defined audience with multiple specifications such as homeowners, specific interests, and specific demographic specifications. This is because of the extra value and precision of reaching a higher-quality audience.

Real-World Industry Examples of CTV Advertising Targeting

The following is how different companies can potentially leverage CTV targeting:

Veterinary Services – An opening doggie day care veterinary clinic can load its existing customer file of dog owners and run a synchronized CTV campaign alongside email and direct mail campaigns. The multi-channel strategy gives maximum exposure to identified pet owners.

Home Improvement – A kitchen and bath remodeling contractor can target 25-mile radius homeowners who:

Own 20+-year-old homes
Have $250K+ household incomes

This is aimed at people who both need remodeling and have the funds to afford it.

Landscaping Services – A landscaping business can geofence high-end neighborhoods and initiate seasonal campaigns starting from the latter half of winter until early spring. They can segment ads into a number of service offerings in order to have maximum relevance.

Fitness Industry – The owner of a gym can geofence competing gyms within a 10-mile radius, targeting unhappy gym members who are in the market for a new gym.

Restaurant Industry – An equipment shipping firm can geofence equipment dealers within a 100-mile radius or even an entire region, i.e., the Southeast, since geographic restrictions are less confining on shipping firms.

Transportation Services – A heavy equipment transportation company can geofence machinery dealers within a 100-mile radius or even target an entire region, like the Southeast, since geographic boundaries are less restrictive for shipping services.

Retail – An upscale women’s clothing boutique can target a certain age bracket of women with incomes of $500K+ so that their ads are only viewed by clients with the kind of disposable income required to purchase luxury clothing.

Personal Services

Barber shops – Target 18-65-year-old men within a 5-mile radius
Mobile car detailing businesses – Target luxury car owners less than 5 years old within a 20-mile radius
Bike stores – Use interest targeting in combination with income levels to target bike enthusiasts

Non-Profit – A non-profit organizing a 5K fundraiser can target the following

Fitness buffs
Runners and walkers
People who have run or walked in other local 5Ks
Layer these with geographic and demographic filters

Wrapping Up With Connected TV Advertising Targeting

The fact that you can layer these targeting strategies so precisely makes Connected TV advertising such a valuable tool for advertisers of any size. Getting a firm grasp of these targeting offerings and knowing how to effectively utilize them means you are empowered to create campaigns that are highly effective at reaching precisely the right person at the right moment.

Getting that balance of precision targeting, without sacrificing an impression count wide enough to get a successful campaign, is important.

Want to learn more about how your business can target with Connected TV advertising?

At OPEMA, we understand that Connected TV advertising might feel overwhelming at first.

That’s why we offer a completely free 30-minute consultation to discuss how Connected TV advertising could work for your advertising and marketing campaign.

During this no-obligation call, we will discuss targeting opportunities specific to your business and demonstrate how CTV advertising can allow you to reach more consumers and grow your brand and discuss potential targeting capabilities that we can execute for you.