top of page

OTT and You: A Beginner's Guide

Updated: Jul 29, 2022

People are watching more video content on their smartphones, as well as on their laptops and desktop computers. The trend of video acceptance on smartphones and laptops began with YouTube. Consumers may now watch longer-form content thanks to that sense of security. As a result, as consumer use of OTT Platforms rises, advertisers will have a more cost-effective opportunity to engage with customers in ways they may not have previously.

You've seen over-the-top (OTT) video content if you've ever binge-watched a show on IMDb TV, streamed a live event on Twitch, or seen your favorite network broadcast app, like Peacock on Fire TV. Any content that is supplied directly to consumers via a streaming video service over the Internet bypassing the traditional cable set box, and often seen on a TV, is referred to as over-the-top (OTT).

Marketers and brands can contact viewers directly over the Internet via streaming video services or devices such as mobile phones, laptops, and connected TV (CTV) devices, like Roku, via OTT (over-the-top) advertising. The word "over-the-top" refers to viewers' ability to bypass traditional TV providers like Xfinity and DirecTV, which regulate media transmission, allowing advertisers to reach their target audiences directly, and these audiences are enormous!

Cord-cutting, which is when a household cancels their cable or satellite TV subscription, is encouraging more people to watch videos on a connected TV. In 2020, more than six million households were predicted to cut the cord, increasing the total number of cord-cutters to 31.2 million. By 2024, that figure is expected to rise to over 46.6 million cord-cutter households, accounting for more than a third of all American families.

Brands have a great chance to include streaming TV advertising into their media plans as a result of this. Another distinction between OTT advertising and traditional broadcast advertising is that OTT advertising often reaches a smaller but more targeted audience, making it ideal for smaller or niche businesses.

Why Use OTT Advertising

Reach the Right Customers and Improve Audience Engagement

Remember the aforementioned cord-nevers and cord-cutters? Advertisers may reach this elusive population on their own terms with OTT. OTT's targeting capabilities allow marketers to reach specific people that they could previously only hope to reach with a wide TV ad plan. OTT allows almost any consumer to be recognized and provided. OTT services can target particular audiences, unlike traditional TV programming, which must serve a large audience. Your ad money will go further on an OTT platform, reaching a more targeted, niche audience than traditional types of advertising.

Not only are you reaching the right audience, but you are also ensuring you have their rapt attention. Fast-forwarding on TiVo, fleeing to the restroom, or changing the station are all options for avoiding advertisements using regular televised advertisements. On OTT services, however, ads are much more difficult to skip—users can't fast forward through commercials, and the digital format makes switching shows hard without losing your place. As a result, the majority of viewers watch OTT advertising all the way through.

Due to the sheer level of personalization that goes into what ads are shown to each unique customer, OTT ads are also more compelling to customers overall. OTT ads, unlike TV commercials, may micro-target client interests, increasing the likelihood of recall. When asked about a specific advertisement, 72% of OTT users could recall it. In fact, data shows that 47% of ad-supported OTT consumers find advertising "helpful or pleasurable."

The audience is also liable to see your ad across multiple devices. Tailored OTT adverts may appear many times. More views equal more desired replies to your advertisements, a principle called "effective frequency."

Higher Click-Through Rates

You've probably noticed that almost all of your YouTube advertising features a clickable link by now. That's because it is highly effective. For viewers, clickable advertising, like those found in YouTube videos, eliminates the "middleman" search step. OTT users, unlike TV viewers, do not need to use a second device to look up a product. They can get more information by just clicking on the advertisement. Ad traffic from television is faster, easier, and more trackable. While OTT's strength is frequently viewed as increasing brand recognition on par with television, research shows that it can also activate sales. After seeing an OTT ad, 30 to 40% of video viewers in APAC completed a purchase (in-store, online, or by redeeming a voucher/promotion).

Better Data Tracking

Brands no longer have to wonder if their ads were seen because of OTT. In a way that broadcast and linear TV never could, OTT advertising may deliver attribution. You can establish whether a person viewed an ad, whether they visited an advertiser's website, and how long they stayed once they arrived using pixel-based monitoring. Brands can collect this information regardless of the device on which viewers watch content.

Although some direct buying platforms, such as Hulu and Sling TV, offer some demographic targeting, programmatic OTT ad buys offer the most flexibility in terms of targeting the population you want to reach. We use addressable (household) geofencing at 7Social to select audiences and, in particular, specific households based on a variety of characteristics. The allure of OTT Programmatic Advertising is the cross-device matching that takes place. As a result, the same advertisement given to a smartphone device can also be delivered to a smart television device in the same household. Ads can be delivered to the proper audience across numerous devices as you curate an audience. The level of personalization that goes into choosing what customers see in advertisements also means you are going to gain more data about your customer base and the effectiveness of your ad spend.

Here are just some of the data variables that can be used for OTT advertising when working with 7Social.