OTT: Future of Advertising

OTT (Over the Top) is the new buzzword in the media and entertainment industry. With more than 25 OTT platforms that distribute streaming media over the internet, the value of the OTT market in India was estimated to be ₹35 billion in 2019. While traditional television continues to be a strong medium for advertising, audiences continue to move towards streaming services.

The Rise of OTT as an Advertising Medium

OTT brings together the best of digital advertising and traditional TV, with high ad completion rates and viewability. With digital advertising growing at approximately 30 percent, the OTT advertising YoY growth is expected to be in the range of between 40 to 50 percent. One of the main reasons for the rise of OTT channels in India is the ease of access and the option for viewers to watch shows that they missed on TV in the OTT channel. The ad spend on OTT is estimated to be around 7 to 8 percent of advertising expenditure in India.

Compared with other digital platforms like Google and Facebook, OTT platforms have better brand safety and are inherently less vulnerable to the dual challenge of viewability and fraudulent traffic owing to high authentication rates, the devices’ closed environments, and the nature of viewing experience.

The Future of Advertising Is Here

Like traditional television, OTT is one of the most effective platforms for driving brand metrics. OTT is an important platform for distributors, publishers, and advertisers to reach audiences at scale and generate positive brand outcomes.

Indeed, the shift to OTT media is expected to be massively benefit advertisers by allowing for more granular measurement and performance tracking compared to traditional index-based TV. This helps narrow down and target customized, complex audiences in real-time. Advertisers that navigate early to OTT platforms before it is part of every marketing department’s budget stand to benefit from building relationships with programmatic partners that can match key audiences with advertiser content.

The Revolution Will Be Streamed

While reach and its measurement are the major obstacles faced by the platform, advancements in OTT measurement are rapidly emerging. Despite the benefits that OTT brings, the industry is still figuring out ways of maximizing its full potential. Even though OTT has mostly won the battle for homes in urban India, there is a lot of opportunities for growth as television viewership continues to increase in rural India. The powerful combination of a highly-engaged audiences, marketing effectiveness and ad completion rates that OTT platforms bring to the table make them an increasingly essential channel for marketers.