Advertising in the big OTTs: How can we take advantage of this game-changer?

What advertiser’s mouth does not water for audiences like these? The inclusion of advertising in OTT content has once again made headlines after Disney + announced that it will adopt a ‘Cheaper Ad Supported Version’.

Mar 22, 2022

Along with major sporting events, big movie premieres or important dates in the gaming world, a new series of events is beginning to be marked in red on the entertainment industry and media calendar: content launch by OTTs.

The audiovisual premiers of on-demand platforms – traditionally series, but also movies – have become cultural phenomena of the first order, generating a great deal of expectation the day shooting starts until they are finally released. This hype causes voracious consumption of content from the very first day it is released, even competing in terms of viewer volume with, for instance, a big soccer match. But if a soccer match lasts for two hours, one season of a series lasts an average of 10 to 12 hours.

To give these phenomena exact figures, we put FLUZO’s measurement possibilities into action and, in October 2021, we analyzed Netflix’s “Squid Game”. The data we obtained is overwhelming: 75% of young people over 18 in Spain had watched the series, 9 out of 10 viewers had consumed the program in its entirety and, on average, 3 episodes had been played daily. In short, many, many hours of consumption – especially among young viewers -, binge-watching and an audience that snowballed and grew exponentially week by week as the show went more and more viral.

What advertiser’s mouth does not water for audiences like these? The inclusion of advertising in OTT content has once again made headlines after Disney + announced that it will adopt a ‘Cheaper Ad Supported Version’ to grow its subscriber base. This version will be available this year in the US and next year in other markets, and has served as a reminder that OTT advertising is a reality on the other side of the Atlantic: according to Mediaradar, in 2021, total OTT ad spend in this market reached nearly $1.3 billion (1.1 billion €) with over 5,500 advertisers betting on this format. Just in the second half of the year, close to 500,000 ads were aired on Discovery+, HBO Max, Hulu (owned by Disney), Paramount+ and Peacock, which already have ad-supported subscription models.

A new advertising cornerstone

As things stand, if OTT content remains this relevant in the future – and everything points to this being the case – we are looking at a very relevant game-changer in the world of audiovisual advertising.

What must we take into account to be prepared?

A priori, the advertising format on these platforms should not deviate too much from that of current CTV – whose advertising contribution we have recently analyzed in a real campaign of Renault– or Online Video. The big difference will lie in the penetration and intensity of consumption of these services. OTTs can be a new advertising lever with which to not only reach the very high volume of users who consume these contents – a volume that keeps growing, albeit at a slower pace – but also to impact audiences such as Low TV Viewers, who today seem to slowly be abandoning traditional TV consumption.

In terms of advertising measurement on these platforms, there are two main paths we should follow (simultaneously) to analyze their performance with rigor:

  • Of course, being able to know how they build coverage; but also what incremental coverage and overlaps they offer over other media, how often advertising impacts occur on them, and how each of these variables changes according to target, moment of consumption, or platform itself. Having all this information will be vital to efficiently integrate these platforms into a media mix that, as we know, is ever broader.

  • Understanding how these ads impact the advertiser’s brand image, what movement they cause to our digital sell-out, or their impact on purchase intent and other qualitative variables.

Without a doubt, everything related to the first point is going to be very relevant, especially in terms of targeting and the possibilities that these platforms provide advertisers to help them reach those who traditionally tend to have lower presence in other media.

The second point is also very interesting. It will take time and a lot of analytical work to interpret this data once we have it: how will user perception be affected by the well defined and established image of the OTT platforms? Or by the content in which ads are inserted? What differences will we find between pre-roll and mid-roll or when we combine the two? Once again, having granular information about the type of impact the user has been exposed to when perception is being investigated will be increasingly important to drawing conclusions.

Clearly, in order to go both ways, single-source measurement will be necessary. This is the only way to compare your advertising’s performance across different media, platforms and devices with a single language.

The final advertising frontier is just around the corner. Let no one say they were not forewarned.

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