Connected TV in 2025: Why Indian advertisers are tuning in

Posted on 22nd Jan 2025

Advertisers using CTV for better targeting capabilities and engagement opportunities, thanks to expansion of internet access in tier cities and increasing affordability of smart TVs

As we enter 2025, the Connected TV (CTV) advertising landscape in India has undergone a remarkable transformation, reshaping audience engagement and presenting unprecedented opportunities for marketers. Experts we spoke to reminisced fondly about how, at one point of time, ad spends on CTV were shunted under the experimental funds in an advertising budget, only to have increasingly become an essential line item in any respectable media mix, a permanence they expect in the next 12 months.

With CTV in 2024 seeing rapid expansion, some industry insiders told this reporter that the machinery is well-oiled to the point of being on auto-pilot as more and more advertisers pile in for the ride in 2025 and beyond, but it’s important to note how we got here, and perhaps more importantly, where we’re going.

CTV Revolution

The CTV market in India has experienced explosive growth, with projections indicating that the number of CTV households could reach 60 million or even higher by the end of 2025, surpassing earlier estimates of 40 million. This surge represents a four-fold increase from 2020 levels, driven by increased internet penetration, the proliferation of affordable smart TVs, and evolving viewing habits.

Noting that 2025 marks five years since the global pandemic reshaped media consumption habits, Nikhil Kumar, Chief Growth Officer at mediasmart, says, “CTV is no longer a niche channel—it's becoming a mainstream medium for marketers.” Kumar attributes this growth to the expansion of internet access in tier-2 and tier-3 cities and the increasing affordability of smart TVs.

The financial implications of this growth are significant. CTV ad spending in India is set for a dramatic increase, with forecasts suggesting a five-fold rise by 2027, and is expected to grow at an annual rate of 47%, potentially reaching $395 million by that year, compared to $86 million in 2023.

CTV Evolution

The CTV advertising ecosystem is becoming more sophisticated, offering advertisers unprecedented targeting capabilities and engagement opportunities.

While pointing out that nearly 100% of the TVs sold today have smart capabilities and connections, Gopa Menon, Chief Growth Officer at Successive Digital, highlights the shift in advertising budgets, saying, “Advertisers are recognizing the value of CTV's targeted reach and premium environment. Expect a greater share of digital ad budgets also some of the TV budgets to flow towards CTV.”

Programmatic advertising on CTV platforms continues to gain traction, driven by real-time bidding and data-driven targeting. This shift allows brands to optimize campaigns for precision and efficiency, reaching niche audiences with greater personalization.

Kumar points out the expansion of CTV advertising beyond traditional boundaries, saying, “CTV advertising, once limited and synonymous with only ads on OTT, is now moving beyond this. To effectively tap into the CTV landscape, brands must ensure accessibility to multiple OEMs and a broad spectrum of content platforms.”

While Western markets have seen CTV sales begin to slide, experts attribute this more to saturation than anything else, and insisting that in India, appetites are just being whet.

Abhijeet Rajpurohit, COO and Co-founder of Cloud TV, refutes the idea that the growth of CTV will taper off, asserting that “the growth of CTV is only beginning to gain momentum.” Despite the overall market slowdown, he emphasizes that this trend is more a reflection of global economic factors rather than a specific issue with CTV.

Rajpurohit highlights the strategic importance of the Indian market, stating, “India has arrived... if you're not available in India, you will not be available anywhere in the globe after five years,” due to the vast and varied consumer base, which presents opportunities for both premium and basic products.

In fact, the CTV space is witnessing the emergence of innovative ad formats that enhance viewer engagement. Interactive ads, including those with QR codes and clickable overlays, are bridging the gap between awareness and conversion.

Tejas Maha, Group Head - Media at White Rivers Media, emphasizes this point, saying, “With interactive formats like QR codes and gamified ads turning traditional commercials into immersive experiences, CTV advertising expenditures are projected to increase by a significant margin in 2025.”

The continuing domination of Free Ad-Supported Streaming Television (FAST) channels represents another significant opportunity. These platforms allow advertisers to reach audiences drawn to cost-effective, quality entertainment through non-intrusive ad formats.

Rajpurohit also points to the growing prominence of regional content, using the example of Dangal, a regional channel that has outperformed major networks to become the top free-to-air channel in India. This reflects a broader trend where regional and independent broadcasters are carving out significant market share. Rajpurohit underscores the appeal of CTV's ability to offer localized advertising, which isn't feasible with traditional TV.

Challenges and Opportunities

Despite the promising growth, the CTV landscape in India faces certain challenges. Menon identifies key issues such as the need for robust measurement standards, market fragmentation, and content piracy. However, these challenges are overshadowed by the immense opportunities presented by CTV's ability to offer precise audience targeting, interactive ad experiences, and the potential for omnichannel impact.

Kumar envisions a future where CTV plays a pivotal role in facilitating seamless journeys between content consumption and transactions. He also highlights the potential of Generative AI in CTV advertising, predicting “more applied use cases of GenAI in CTV advertising – whether it is in content creation, ad personalization, serving contextually relevant ad experiences in real time.”

“There is the promise of CTV’s omnichannel impact – which continues to provide more value to advertisers by mapping mobiles and DOOH. As the CTV universe grows bigger, we’ll see more impactful synchronization of cross-platform campaigns to reach consumers agnostic of the platform,” says Kumar, adding CTV’s ability to bridge devices—such as linking a TV ad to an exclusive mobile offer or generating offline impact — creates cohesive messaging across touchpoints and delivers ROI for brands.

As we look towards the future, it's clear that CTV is not just a trend but a fundamental shift in how audiences consume content and how advertisers reach them. Maha succinctly captures this sentiment, saying, “As they say, "money follows eyeballs," and today, those eyeballs are glued to CTV screens.”