Viewership across “over-the-top” (OTT) devices—defined as an internet-enabled viewing device for your TV, including Apple TVs, Amazon Fire Sticks, Rokus, gaming consoles, and smart TVs—has been steadily increasing year-over-year. Just two years ago, OTT represented only 8% of digital video ad views. Now it represents 32%, according to the FreeWheel Video Monetization Report: Q1 2017, launching on June 14, 2017. Despite this growth, advertisers and agencies have been cautious about doubling down on OTT investments. In this post, I address the top five challenges surrounding OTT and explain why these don’t need to be major blockers for advertisers looking to reach audiences across premium OTT content. I also highlight the distinctive advantages unique to the OTT market.
At Variety’s recent Entertainment & Technology conference in NYC, ad experience resurfaced as a hot topic. During a panel on, “The Future of TV Advertising,” it was clear that leaders from both publishers and agencies agreed that consumers should be at the center of the ad experience. There was a consensus that more experimentation was necessary and that the dialogue around ads needs to evolve from “commercial interruption” to “commercial enhancement.”
There remains a seemingly perennial theme present in the Upfronts: unification and the ability to help advertisers reach their audience regardless of their device or platform. As more of this premium video is consumed across different screens, the quantity of unified transactions that occur across linear and digital TV has increased. With every year that passes, this theme grows ever more pronounced as the aggregation of audiences and execution of unified campaigns creates complexity for buyers and sellers who are often native to one side of the premium video world.
As the concept of television continues to evolve, audiences have more options than ever when it comes to viewing premium content. While the ability to connect with consumers across screens is immensely valuable for publishers and advertisers alike, it has also become increasingly complex to insert ads anywhere content appears. Particularly, it is difficult to account for ad insertion challenges, while also honoring the business rules of a deal and delivering an optimal user experience. Several forces are at play here: (1) many endpoints have strict player requirements, (2) advertisers/agencies often have difficulty meeting these technical specifications, and (3) premium publishers struggle to fill inventory requirements for multiple endpoints in a way that maximizes sell-through. These factors are costing buyers and sellers numerous ad dollars from missed revenue opportunities.