Resources: JamLoop

The Basics of OTT Advertising

Oct 5, 2020 1:58:37 PM / by Joe Pacitti

When people think about paid advertising, they may think about social media ads, Google pay per click campaigns, sponsored content, and possibly TV or magazine ads. There is another option that some may not consider, over-the-top media.

Over-the-top (OTT) media services are streaming services that go to users through the internet, like Netflix and Hulu, instead of cable, satellite, or broadcast television. The rise in popularity in streaming services has led to the need for OTT advertising so that companies can still reach their audiences.

The Benefits of OTT Advertising

OTT advertising allows marketers to go over TV providers and bring their ads directly to their audiences, which gives you some freedom since you do not need to worry about the schedules for shows you want ads to air during or pay extra for certain times of the day. Essentially, broadcast television ads cast a broad net over your targeted audience, whereas OTT ads allow you more control to focus your advertising efforts.

Approximately 60 percent of adults between 18 and 29 primarily watch TV through streaming services now (1). Only 31 percent of them watch TV through cable or satellite, and five percent use a digital antenna. This means that for a brand to reach a younger audience, they need to invest in OTT advertising. 

Even the news is usually gathered through OTT services instead of watching it on television. Pew Research indicated that of young adults who watch the news, 37 percent prefer watching or reading it online. Seventy-eight percent of people under the age of 50 get some — if not all — of their news from social media (2).

Targeting Capabilities

An OTT advertising platform like JamLoop has seemingly endless possibilities for targeting an audience. You can target your audience based on traditional demographics — age, gender, income level, etc. — or you can use other targeting metrics like the shows they watch, locations they have been to, purchasing data, and more. The separate profiles that are available on some streaming services are more than just a way to keep everything organized, they help collect all of the data that can be used to customize an OTT advertising experience and increase your targeting capabilities.

You can put together any variations you want to for your OTT ad campaigns to help you get your ads to the right people. The ability to hyper-focus your campaigns can help you maximize your return on investment (ROI).

Paying to Reach Your Audience

For a business to get a 15 to 60-second-long ad aired on TV, it usually costs between $5 and $34 for a local ad, and the average cost of a national TV ad is $115,000. Either way, this can add up quickly and you are not guaranteed to reach your target audience. With as focused as targeting can be with OTT ads, an advertising budget can go a long way.

Avoid Paying for Blocked Ads

Since many people use ad blockers now, it can sometimes be harder to reach your intended audience. The great thing about OTT advertising is that you usually pay a cost per thousand (CPM), so if someone is blocking your ad, you will not waste money on it.

OTT Streaming Options

Streaming services may seem like they are all under a single thing, but there are several variations of OTT services.

Subscription video on demand (SVOD)

SVOD services require a subscription. These include:

  •         Netflix
  •         Prime Video

Advertising-based video on demand (AVOD)

AVOD services are free and supported by ads. Examples include:

  •         Pluto TV
  •         Crackle
  •         Tubi

SVOD/AVOD Hybrids

These services include a mix of paid subscriptions and advertising:

  •         Hulu
  •         Philo TV
  •         Fubo tv

Multichannel video programming distributors (vMVPDs)

These streaming services have paid TV programming. These include:

  •         Comcast Xfinity
  •         YouTube TV
  •         AT&T Now
  •         Sling

Regardless of whether you are watching TV on an SVOD, AVOD, vMVPD or other streaming method, virtually all of the well-known television shows and movies from well-known content networks, such as ABC, NBC, CBS, FOX, AMC, Discovery, A&E, Turner, etc. are accessible via these services. It really is the “new” television!

Connected TV (CTV)

This is a TV that is connected to the internet via a streaming device such as a Roku, Amazon Fire, Apple TV, Chrome Stick or directly via a “Smart” TV.

Linear TV

This is traditional television through a broadcast company.

Good OTT Practices

While OTT advertising can come in many shapes and sizes, these are a few tips for good practices.

Format the ad for Multiple Devices

When you design your OTT ads, it is important to keep in mind that the video will need to be formatted to work on multiple types of devices. Since streaming can be done from a TV, phone, tablet, or computer, and each device has different screen sizes and requirements, you will need to ensure any ad can be adapted to fit whatever screen the ad is being watched on.

Get Creative!

Your audience is more likely to respond well to a creative ad that is relevant to them. With OTT advertising, you can use the location, day, time, and more to incorporate into your ads to make them a little bit more personal and relevant to the audience than you would be able to do through a broadcast TV service. If you have standard 0:15 or 0:30 second creative that you’ve been using for traditional linear TV commercials, you can use those too.

Keep Unskippable Ads Under 30 Seconds

We know that people like to avoid ads, that is exactly why streaming has become so popular. So, when someone is watching an unskippable ad, it needs to be kept at 30 seconds or less — 15 seconds is ideal.

Cross Channel Targeting

In television marketing, you could have ads running on several different channels, with the hopes of hitting the right audience. With OTT advertising, you can take a cross channel approach that will allow you to reach your audience through multiple avenues at once. You can do this by targeting the same audience on OTT, Facebook, and app ads, helping you to get your name on their minds.

 

References

(1) "About 6 in 10 young adults in U.S. primarily use online streaming to watch TV." Per Research Center. 13 Sept. 2017. https://www.pewresearch.org/fact-tank/2017/09/13/about-6-in-10-young-adults-in-u-s-primarily-use-online-streaming-to-watch-tv/

(2) Shearer, Elisa and Gottfried, Jeffrey. "News Use Across Social Media Platforms 2017." Pew Research Center. 07 Sept. 2017. https://www.journalism.org/2017/09/07/news-use-across-social-media-platforms-2017/

Joe Pacitti

Written by Joe Pacitti