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Maggie Cassidy
September 05, 2017

How to Reach Cord-Cutters with OTT Advertising

pexels-photo-265685.jpegWe are a generation of binge watchers. Over the course of a weekend we are able to stream multiple seasons of multiple television shows and a plethora of movies, all with the help of OTT services.

What is OTT?
Over-the-top (OTT) content services refers to video and other media that is transferred to a consumer as a standalone product. It can also be referred to as subscription video on demand - think Roku, Apple TV, Chromecast and the like.  

Who uses OTT services?
According to a study conducted by the IBB Consulting group, almost half of U.S. online consumers - around 49% - now subscribe to at least one paid OTT service with 33% subscribing to two services. And those numbers don’t include the amount of people who access OTT services through shared login info. Reuters stated that over 20% of young adults (aged 18-24) say they access at least one OTT service by using shared login credentials, with 12% of adults admitting to doing the same thing.

What does OTT mean for advertising?
While 63% of OTT consumers still have some form of a traditional cable subscription, cord-cutting is on the rise across all demographics, which means that the once ‘stable’ world of standard television advertising will be changing too. Netflix, possibly the most popular OTT service, has been praised for not having any ads or commercials within their content. It has actually been estimated that Netflix misses out on over $2.29 billion in potential advertising revenue. However, most other OTT services require viewers to experience ads in some capacity, albeit in shorter, segmented ways.

As more and more cut the cord, standard television advertising will become increasingly ineffective, which means advertisers and marketers will again have to adapt and refine their strategies for reaching their consumers as they sit down to binge yet another season of The Great British Baking Show.

How can brands navigate the OTT space?
Viewers generally harbor a distaste for advertising and commercials, especially in Netflix content (while still ad free, Netflix subscribers have been adamant about cancelling their subscriptions if Netflix were to feature ads). Despite the strong feelings toward ads, FreeWheel, a component of Comcast’s advertising solution team, reported that on average OTT viewers complete 98% of video ads when compared to other devices.

Even though that 98% is a comforting number to brands, OTT advertising is still very much fragmented. The current and primary method for reaching OTT users is geography, which favors smaller business that cater to a more specific target. But despite its fragmentation, that doesn’t mean that OTT advertising can’t be lucrative for brands. Here are a few tips on how to navigate the landscape.

Transparency is key
Brands should work with OTT partners who can provide you with the knowledge of where exactly your ads will appear. If you want to protect your brand safety and avoid ad fraud, pepper your partners with questions.

Consumer experience comes first
If OTT is supposed to be an improvement on how we consume television, then the ads - if there are any - have to be improved too. In order to prevent consumers from seeing the same ads over and over again, work with partners who can provide a frequency cap on your ads.

Reevaluate relationships
Since OTT is disrupting how we consume media and advertising, brands need to redefine their relationships with agencies, third-party data platforms and media companies in order to operate and get what they want in the OTT world.

As more OTT content is created, the desire to cut the cord will grow exponentially. And in order to make sure their brand’s messages aren’t snipped along with the cable, brands and marketers are going to have to develop their OTT advertising techniques as the field unfolds.   

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