Three Signs that OTT Advertising is Growing Up

Maegan Buckler  | 

It wasn’t too long ago that “over the top” (OTT) content, referring to streaming media delivered over the internet, was considered a novelty. Popular streaming platforms like Apple TV and Roku have only been around for the past 10 years. But even in this short timeframe, OTT has quickly evolved from a niche business into the media mainstream. In fact, according to recent estimates by eMarketer, there will be more than 200 million OTT users in the US by 2019. With that growth in the OTT audience, there has also been a corresponding growth in innovation in OTT advertising. Here are three examples of how OTT advertising is growing up as the format goes mainstream.

It’s Getting More Targeted
Even thought OTT content and ads are delivered over the Internet, the format often feels very much like a TV-style experience.  But while the viewing experience is similar, OTT is taking TV one step further, allowing advertisers to more precisely target (and re-target) their most important customers. Just last month, ESPN announced a new feature in its OTT content service that will allow advertisers who buy inventory for OTT to then re-target viewers as they move between other ESPN digital properties. This “…essentially takes what we’re doing on OTT, which is completely measurable from a digital perspective, and then retargets those messages across our digital footprint,” said ESPN’s Vikram Somaya, SVP, Global Data Officer & Ad Platforms, in an interview with Beet.tv.

It’s Getting More Data-Driven
OTT services have been a boon for consumers, allowing them to watch their favorite content whenever and wherever they want. But that’s also created a new challenge for advertisers, who need to find new ways to deliver consistent and coherent messages to viewers as they switch between formats. The solution to this dilemma will likely focus on gathering more and better-quality consumer data. As Adweek recently noted, this will encourage the ad industry to focus on “addressability,” targeting consumers not just based on the content they watch but instead building sophisticated profiles of viewers using internal databases and third-party sources. While this is still a work in progress, there are signs that the industry is beginning to coalesce around solutions. comScore, for example, now offers an OTT intelligence product that helps advertisers track viewer behavior across Amazon, Hulu, YouTube and Netflix.

It’s Helping to Re-think the Ad Experience
Perhaps the biggest sign of OTT’s growing importance is how it is reshaping advertising creative. Some of the biggest OTT providers like Netflix, Amazon and Hulu still don’t have advertising (at least not yet). But even if these OTT giants don’t offer ads, their viewing experience is having a profound impact on the creative choices made by publishers and advertisers on other ad-supported OTT platforms. Just consider the resurgence of “single-sponsor” programming as one example. There’s also the rise of six-second ads, along with increasing publisher experiments with reduced ad loads. Each of these innovations is helping the industry to expand their horizons when it comes to engaging ad creative.

OTT advertising has only been around a few short years. But even in this brief time span, it’s already having a profound impact on the advertising industry at large. In fact, today’s publishers and advertisers are recognizing a growing need for more targeted, more data-driven, and more creative advertising experiences within the OTT environment. That’s helping to push the entire industry forward as a result, creating better experiences for advertisers, publishers and consumers as a result.

Maegan Buckler
Maegan Buckler

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