Rise of OTT and its impact on Digital Landscape
Date: September 14, 2021|
In 2010, Jeff Bewkes, then CEO of Time Warner, was asked if he thought Netflix had any chance of taking over Hollywood. His sarcastic answer was: ‘Is the Albanian army going to take over the world?’ A decade later, Netflix has become one of the largest media businesses ever known with hundreds of millions of subscribers. And it’s not just Netflix, the shift and the increase in the number of user base across other OTT platforms is clearly visible and it’s evident that the “cable TV” industry has been bleeding for quite some time now.
Before we begin and get into the nitty gritty of how OTT has revolutionized the digital landscape, the Terms OTT is simply referred to as the Devices that go “Over” the Cable Set Top Box to give users Access to TV Content. In OTT, content delivery is done via the Internet instead of traditional cable/Broadcast providers.
The biggest reason to shift from cable TV to OTT is that now one can watch serials, movies and web series on OTT platforms anytime they want, anywhere they want. I remember as a kid when I used to wait every week to just watch an episode of my favorite series and count my blessings if the power didn’t go out but now all anyone needs is just a smartphone and one can watch their favourite program whenever they please.
The coronavirus pandemic has also given a major push to the already growing user base. People shifted to social media, gaming, and digital OTT platforms, from theatres, events, and theme parks for recreation and entertainment. Another reason is the increasing availability of public Wi-Fi and unlimited wireless data plans has also helped bolster the growth of OTT providers and services.
OTT has opened up the possibility for ad-free content, by enabling subscription services (SVOD), one-time purchases (TVOD) and other monetization strategies. If advertising (AVOD) is your preferred model, OTT provides the power of targeted advertising and control over your campaigns and inventory, including direct sponsorships whereas on cable TV network there’s not much one can do when it comes to targeted advertising.
OTT advertising opens up new avenues for Branding and content marketing. With OTT, brands can choose how and when to air their marketing campaigns to hit certain demographics. The way digital OTT commercials work is by unleashing precise targeting that eliminates wasted runs. There are two ways one can buy OTT advertising: Guaranteed IOs (insertion orders) and Programmatic.
• Guaranteed IO (insertion orders) buys are set-priced, set impressions, usually based on reach and frequency.
• Programmatic buys are based on a real-time bidding environment that allows the advertiser and the agency to maintain control of targeting but does not guarantee set impressions or frequency.
This has challenged traditional content and service providers like Sony and Zee with finding ways to stay relevant or risk losing customers and has pushed them to launch their own OTT apps to retain their user base. A few other benefits of OTT video over traditional TV:
• Precise targeting that eliminates waste
• Enhanced ad relevance leading to increased engagement
• Build and supplement base campaigns with focused, complementary strategies: incremental reach, manage frequency, target competitors, focus on lapsed customers
• Improved accountability – quantify the effectiveness of TV; optimize future campaigns
Digital advertising spends have left television advertising spends far behind and make for more than 37% of the total advertising spends across the world. In today’s day and age when OTT apps are sweeping across the digital landscape, sticking with traditional digital marketing ads on social media and search will not provide the leverage which it once did in this ever-changing digital landscape. So, if you are a business owner and are looking to increase your revenue, or your user base or your brand presence, it’s high time to seriously start considering advertising on OTT platforms and get a head start against your competitors.