Gracenote report highlights contextual targeting gap in CTV advertising

Connected television advertising faces a strategic misalignment between campaign objectives and execution tactics, research from Gracenote suggests. The content data business unit of Nielsen released findings on October 1, 2025, showing that while media professionals prioritize brand awareness as their top CTV objective, most continue relying on narrow audience-based targeting methods better suited for performance marketing.

The survey conducted between July 10-20, 2025, gathered responses from 600 U.S. brand and agency executives with control over marketing and advertising spend. Respondents represented industries including media and entertainment, telecommunications, retail, financial services, automotive, consumer packaged goods, and healthcare.

Spending patterns and effectiveness concerns

The research reveals substantial budget shifts toward CTV. Nearly 46% of respondents reported moving 26% or more of their paid media budgets to CTV over the past three years. Among brands in financial services, retail, technology and healthcare, that figure reaches 52%.

Currently, 27% of all survey respondents allocate 40% or more of their total budgets to CTV. For the same four industry segments, the percentage rises to 31%. These allocations align with IAB projections that U.S. CTV ad spending will total $26.6 billion in 2025, representing a 12% increase from 2024.

Despite increasing investments, confidence in CTV effectiveness remains tepid. The survey found that 32% of respondents consider their CTV advertising "not very effective," with only 27.8% rating it "extremely effective" and 40.5% calling it "very effective."

Targeting strategy disconnect

The effectiveness gap stems partly from strategic choices. Brand awareness emerged as the primary objective for 30% of respondents, followed by revenue growth at 28% and customer acquisition at 22%. Customer retention, which typically relies on performance marketing approaches, ranked fourth at 16%.

Yet targeting strategies tell a different story. Demographic targeting topped the list at 29.5% importance, followed by interest-based targeting at 21% and geographic targeting at 19%. Behavioral targeting claimed 10.3%. Contextual targeting at the program level received only 9.2% prioritization, while channel-level contextual targeting garnered 11%.

This pattern reveals what Gracenote characterizes as a fundamental mismatch. Respondents are applying bottom-of-funnel tactics to what they've identified as top-of-funnel brand building objectives.

The contextual knowledge gap

Familiarity with contextual advertising techniques appears limited. Only 45.2% of respondents reported being "very familiar" with contextual targeting, while 38.8% said they were "somewhat familiar." The remaining 16% indicated vague familiarity or no familiarity at all.

The lack of awareness is notable given how contextual targeting addresses several of the challenges respondents identified. When asked about their top CTV advertising obstacles, 27% cited lack of insight into whether ads reached their intended audience. Another 20% pointed to insufficient ROI visibility, while 17% mentioned lack of insight into where ads appear.

Brand safety concerns, where ads appear in unsuitable contexts, troubled 14% of respondents. Lack of transparency into CTV inventory affected 13%, and fraud concerns registered with 9%.

The metadata problem

The research highlights technical infrastructure issues hampering CTV advertising effectiveness. Nearly 70% of respondents identified lack of standardization and unification in content metadata as at least a modest challenge when developing CTV campaigns and assessing results. Among those, 20% called it a significant challenge.

The importance of standardized metadata is clear. When asked, 31.5% of respondents rated it "extremely important," while 38.7% called it "very important." The practical impact proves substantial: 62% said standardized metadata would provide greater confidence in CTV ad planning, and 54% indicated it would drive increased CTV ad spending.

The metadata gap proves particularly acute on free ad-supported television channels. Gracenote tracked nearly 1,850 active FAST channels as of July 2025, distributing more than 182,000 TV shows, movies and sports programs. Half the available content was produced within the past five years.

Yet FAST content shows significant metadata deficiencies compared to subscription streaming services and virtual multichannel video programming distributors. For sports programming on FAST channels, 68% lack imagery, 55% miss original air date information, 39% have no episode title, and 23% lack genre classification.

Television shows on FAST platforms show similar gaps: 68% lack production country information, 46% miss original air date data, and 21% have no genre designation. Feature films fare somewhat better but still show substantial holes, with 79% missing production country details and 78% lacking production company information.

Current viewing patterns

The stakes for improving CTV advertising effectiveness are considerable given current viewing trends. In Q1 2025, CTV accounted for 48% of U.S. viewers' television time, surpassing traditional live TV at 46%, based on Nielsen Audience Insights Data.

Ad-supported content represents more than 45% of streaming viewership as of Q2 2025, up from 42.4% in Q1 2025. The three leading FAST platforms—Pluto TV, Tubi and The Roku Channel—accounted for 5.7% of total TV usage in May 2025, representing a 36% increase from the previous year.

Usage patterns for individual platforms show sustained growth. Nielsen Scarborough USA+ data indicates that among people 18 and older over the past 30 days, Tubi usage reached approximately 14% by the second half of 2024, up from roughly 10% in the first half of 2023.

Programmatic buying considerations

The importance of content metadata extends to programmatic advertising, which accounts for 85% of CTV buys based on IAB data. Programmatic platforms require contextual signals to make informed buying and selling decisions. When metadata is incomplete or inconsistent, these platforms lack the information needed for effective transactions.

The technical requirements prove especially critical for live sports events and TV show premieres, where original air date information frequently goes missing. A sample analysis of sports programs shared by Rain the Growth Agency found that among 28 sports programs, only eight included content title information. Three listed "tv" in that field, while five provided details about individual teams competing in MLB games.

Among sports programs airing between mid-July and mid-August 2025, 55.4% lacked original air date information before metadata enrichment. This absence limits insight into whether a game is live or recorded—a crucial distinction for advertisers.

"CTV has not delivered the scale and premium reach that marketers expect of the largest screen in the house largely based on the use of narrow targeting tactics," said Jake Richardson, VP of Partnerships at Gracenote. "By taking better advantage of contextual targeting capabilities with their CTV campaigns, they have new opportunities to drive both return on ads spend and the scale they've been looking for."

Market implications

The research suggests that despite CTV's digital nature and audience-based targeting capabilities, the channel may not deliver on performance promises comparable to earlier digital channels like desktop, video and mobile. Brands recognize CTV as the location of highly engaged audiences, but achieving both precise user-targeting and scale has proven difficult.

Gracenote's findings indicate that marketers need to complement audience-based strategies with content-based initiatives to engage potential customers beyond existing segments. This means focusing on what people watch in addition to who watches it.

The company has begun enabling more effective programmatic CTV advertising through product offerings and partnerships leveraging its content metadata, taxonomy and identification systems. These capabilities build on Gracenote's history powering entertainment search and discovery features that connect viewers to content.

Timeline

• 2024: IAB reports U.S. CTV ad spending at approximately $23.7 billion
• First quarter 2025: CTV viewing time (48%) surpasses traditional TV (46%) in U.S.
• Second quarter 2025: Ad-supported streaming reaches 45.3% of streaming viewership
• July 10-20, 2025: Gracenote conducts CTV advertising survey of 600 executives
• July 2025: Gracenote tracks 1,850 active FAST channels distributing 182,000+ programs
• August 2025: Nielsen begins integrating CTV tracking into Ad Intel platform
• September 16, 2025: Index Exchange becomes first SSP to integrate Gracenote contextual intelligence
• September 25, 2025: Teads research shows CTV HomeScreen ads achieve 48% attention rate
• October 1, 2025: Gracenote releases report on CTV advertising trends
• 2025 projected: IAB forecasts U.S. CTV ad spending will reach $26.6 billion

Related coverage

• Marketers struggle adapting creative for CTV campaigns, with 72% reusing or slightly modifying assets across platforms
• Kargo CTV campaigns achieve 78% higher attention than industry standards through Enhanced Branded Canvas format
• Criteo and WPP Media launch commerce-driven CTV activation, merging real-time commerce signals with addressable TV capabilities
• Magnite acquires streamr.ai to democratize CTV advertising for small businesses through AI-powered tools
• DeepIntent unifies audio and CTV for healthcare advertising with HealthFirst package targeting patients and providers

Summary

Who: Gracenote, Nielsen's content data business unit, surveyed 600 U.S. brand and agency executives with oversight of marketing and advertising spend, representing media/entertainment, telecommunications, retail, financial services, automotive, CPG and healthcare industries.

What: Research revealed a strategic disconnect in CTV advertising where 80% of marketers use audience-based targeting tactics despite prioritizing brand awareness objectives, contributing to 32% viewing CTV as ineffective. The study found limited familiarity with contextual targeting (45% very familiar) and identified significant metadata standardization challenges affecting 70% of respondents. FAST channels showed substantial metadata gaps, with 55% of sports programs missing original air date information.

When: Gracenote fielded the survey between July 10-20, 2025, and released findings on October 1, 2025. The research examined current CTV spending patterns, with projections indicating $26.6 billion in U.S. CTV ad spending for 2025, up 12% from 2024.

Where: The study focused on U.S. market dynamics, where CTV viewing time reached 48% of total television consumption in Q1 2025, surpassing traditional TV's 46%. Ad-supported streaming content represented 45.3% of streaming viewership as of Q2 2025, with FAST platforms accounting for 5.7% of total TV usage.

Why: The research matters for marketing professionals because it exposes efficiency losses in CTV advertising. With 27% of respondents allocating 40% or more of total budgets to CTV, and 46% having shifted 26% or more of budgets to the channel over three years, effectiveness concerns carry significant financial implications. The findings suggest that limited contextual targeting adoption and metadata standardization issues prevent marketers from achieving the scale necessary for brand building objectives, despite substantial budget commitments. The research identifies specific technical barriers—particularly in FAST channel metadata—that programmatic platforms need to execute informed buying decisions.