OTT and Ads- What lies ahead for a potentially game-changing synergy? – Bernard G
Market Segmentation: Let us delve into the different types of segments or vendors that exist
within the OTT Framework.
OTT or commonly known as Over the Top is any streaming service that is offered via the internet rather than through traditional Over Air Methods (TV, Cable). Will the evergreen idiot box be a thing of the past? All OTT streaming platforms offer methods to directly stream their content into internet-connected television as well. According to a KMPG market report, the Indian OTT market has exponentially grown by over 54% in the last fiscal year and the number of OTT users will increase to nearly 500 million making it the largest market for OTT platforms outside the United States.
SVOD: Subscription-based Video on Demand platforms. Flat rate subscriptions are provided to the user, the user has the discretion of choosing as per their preferences and can consume an unlimited amount of content suitable to their taste. The advantages of SVOD not only include continuous streaming without any interruptions, but it also offers native and original content to its viewers, at a time of their choosing at prices that would compare to any regular TV/Cable subscription.
AVOD: Advertising-based Video on Demand platforms: They offer free or very meagre charges for subscriptions but use a variety of ads (short, mid, or long form) across content, and target audiences who are naturally inclined to resonate with the ads.
Although SVOD has seen a potentially big growth in the Indian market over the last two years, they still trail behind AVOD platforms in terms of viewership, reach, and engagement. The main driver for SVOD platforms is original content, but in the current scenario, consumers gravitate towards the content on SVOD platforms based on convenience rather than a true desire to uncover original content.
Current Advantage and Challenges for OTT to be an Advertising Platform:
OTT platforms have the potential to be an interesting addition to the advertiser’s kitty that can help not only increase viewership but also facilitate long-term growth.
The primary metrics to be considered are Reach and Engagement.
Reach: Building reach across an OTT platform is extremely enticing due to its advanced targeting capabilities with multiple criteria such as demographics, location, behavior, and content preferences. 80% of OTT platform users make up some of the most niche audiences known across any medium, and the ability to run ads at uber-specific consumer interests is definitely a plus. Determining reach is the major challenge faced in OTT platforms, as there is no common measurement tracker available as yet.
Engagement: In order for OTT platforms to truly realize their full potential as carriers for strong ad campaigns they have to be well and truly ingrained into the content that is being consumed from an early stage. The safety of a brand within this platform is of paramount importance, and engagement would be one of the key metrics deciding the overall performance.
What is the future of OTT?
With more and more consumers preferring content through streaming platforms, OTT and OTT advertising are here to stay. The true test lies in at what part of a brand’s life cycle they would want to invest in OTT platforms. Once more streaming options come into the market and standardized analytics for reach and engagement are mutually agreed upon by all OTT platforms, brands can decide their way forward on whether the OTT mediums make sense for them as a potentially new avenue for advertising.
