Tech enables OTT/Video emergence and convergence of two separate mediums

Mar 6, 2020 | Articles

Tech is constantly re-shaping the way we live and interact with the world. This also includes the way we play games, listen to music or watch TV. Increased Internet accessibility and speed and cutting-edge, video-capable devices made it possible for new streaming services to emerge and grow. As a result, OTT video services are the only ones able to satisfy the current global demand of a hyper-local, personalized content and can therefore offer a much better user experience than traditional TV.

The significant growth of VOD through subscription services and apps has created a massive challenge for buyers and has forced advertisers to change their media strategy. This should be seen as an opportunity to improve the efficiency of the current advertising forms and models. Also, as a way to better control media buying margin, which is mainly the reason why corporations like Fox or Byron Allen are acquiring local radio, TV and media companies. Advertisers are wisely transitioning from traditional media to OTT advertising in order to reach hyper-local audiences and local corporations are the best chance for bigger corporations to keep scaling in this environment.

Since OTT allows targeting by demographics, interests, behaviors and geographic location, brands are now able to reach a more specific audience. Also, they are able to go really granular by adding third-party data such as in-market segments, life stage or income. This way, buyers are able to improve accuracy and deliver ads to the right audience. 

Apart from better targeting options, OTT video advertising has another great advantage: ads will only play when users are actively viewing, which is easy to determine, since they can play or pause videos themselves. Paradoxically, this control over the displayed content also opens the door to new ways to engage with the audience, that usually involve becoming more creative and flexible. Interactive or playable ads are good examples of this.

This said, every single time that users play or even pause a video should be seen as an opportunity to maximize both, ad and subscription revenue. From commercials displayed between episodes, to interactive ads with engaging calls-to-action, there are many different ways and moments to effectively impact viewers. However, they all involve strategizing and creating new, adapted user experiences across different ad forms and spaces throughout the whole viewer’s content journey.

In this new context, it seems to be clear that new ad models and formats are key not just to take advantage of new forms of content consumption, but also to survive in a media environment that becomes more and more complex every day. Those publishers who are more creative, flexible and nimble, will be dominating a scene where advertising is paired up with OTT video subscription.