OTT Advertising

Why Advertise On OTT? Because It Works.

Streaming video is one of the best developments in the marketing sphere in the past decade. Nearly 80% of US adults use some kind of streaming service as their primary means of consuming TV programs. As these kinds of OTT streaming services have grown, marketers are taking advantage of new OTT advertising opportunities.

Over-the-top (OTT) video refers to videos presented directly to consumers through internet streaming websites or smart TVs. The phrase “over-the-top” reflects how internet and streaming services can provide video to consumers without going through traditional cable providers. As streaming becomes more popular, OTT video has become the main form of video consumption for consumers.

What Is OTT Advertising?

OTT advertising involves delivering advertising content to consumers through internet video platforms. One of the main reasons for OTT advertising is that you can reach a much more specific demographic of viewers than traditional TV advertising.

When thinking about OTT advertising, most people think of the streaming giants, like Roku, FuboTV, or YouTube. But there is an ever-growing world of OTT platforms that provide more opportunities to reach niche audiences.

What Are the Benefits of OTT Advertising?

OTT is trending right now, and for a good reason. There are countless OTT advertising companies capitalizing on the various features available on OTT advertising that aren’t available with traditional TV ads. Here are some of the reasons why OTT advertising is so popular.

OTT Marketing Helps Minimize Ad Spend Waste

Traditional TV advertising has one major problem. There is no real way to guarantee that a particular person sees your ads. With streaming services, you can embed ads in a specific video, so it only plays when someone is actually watching.

The result is that you spend less money on wasted ads. Every time your ad plays, you can be sure that it’s not just on dead air. With OTT, you only pay for ads people actually see.

Larger Audience Reach

Streaming is now the most popular way to consume video content in the country. As of 2020, nearly 3 in 4 American consumers used at least one video-on-demand service — an increase of nearly 25% over the past five years.

Higher streaming numbers mean more significant audience reach. Moreover, streaming demographics are more diverse than cable demographics, meaning more opportunities for niche targeted campaigns.

Strong Audience Targeting Opportunities

Many streaming and video services, such as YouTube, allow ad targeting to consumers based on age, gender, income, and other demographic categories. Additionally, streaming video has excellent potential for behavioral targeting based on viewer interests, purchase history, and search behavior.

Micro & Geotargeting

Micro and geotargeting are ways of applying geographical information to drive sales and ads. This kind of proximity targeting records the physical location of consumers to distribute ads. For example, a restaurant can set up a geofence that will push ads to people within a one-mile radius.

A/B Split Testing

A/B split testing is a form of marketing research that compares the effectiveness of two marketing elements, such as landing pages, emails, or product features. The principle behind A/B testing for ads is simple — just run both ads for some time and compare what kind of results you get.

A/B testing is useful because it can tell you what kinds of marketing elements and strategies produce the optimal effects. You can utilize A/B testing to manage things like video length, ad placement, text content, and more. OTT platforms are perfect for A/B split testing as you have a high degree of control over ad presentation and placement.

Data Analysis

One of the major benefits of OTT is the amount of audience data it can generate. Big data illuminates interesting patterns you can use to fine-tune your marketing approach. You can combine data pools with machine learning models to adjust content in response to viewership and engagement.

Flexibility in Budget

Last but not least, OTT provides more flexibility for purchasing ad space. You can start with a very small number of ads and scale up as needed, rather than buying a set package for a traditional TV provider. Greater flexibility means less wasted money on ad space.

How Is OTT Advertising Bought?

OTT platforms sometimes have complicated advertising structures, so it can be tough for beginners to understand how platforms work and how to buy OTT ads.

OTT platforms typically offer two types of OTT ads

•  Programmatic
• Guaranteed

Programmatic ads use a real-time bid system that does not provide guaranteed impressions but generally gives you more control over targeting and measurement metrics. Guaranteed insertion orders provide a set number of guaranteed impressions and CPMs, as well as more sponsorship opportunities. Generally speaking, guaranteed insertion orders are more expensive than programmatic ads.  All in all, it’s usually easiest for brands to buy media directly from OTT advertising companies like The Remnant Agency.

How Are OTT Ads Delivered?

OTT ads are delivered through either a closed ecosystem or an open ecosystem. In a closed ecosystem, your ads appear across the entire range of a single publisher’s OTT platforms and devices. For example, Amazon’s OTT ad program provides access to the entire network of Amazon devices.

Open ecosystems, in contrast, allow distribution across multiple publishers. Open ecosystems, such as NBC Universal, distribute your ads to several publishers where there are content streams. Whether you should pick a closed or open ecosystem depends on what kind of targeting data you have access to and your brand initiative.

OTT Ad-Insertion Methods

Companies can use two types of ad insertion methods: client-side insertion and server-side insertion. Client-side insertion is the older method and involves loading ads into the video player itself. Client-side insertion is simple but is susceptible to ad blockers.

Server-side insertion mixes the ad stream into the video stream, forming one continuous video stream. With server-side insertion, your ads stream in the same feed as the video.

Advantages of Server-Side Ad Insertion in OTT

Server-side insertion is the better method for a couple of reasons. First, it is less susceptible to ad blockers. Since the stream mixes content and ads into the same feed, ad blockers cannot discriminate between frames of the video content and frames of the ad.

Second, server-side insertion has fewer latency issues than client-side insertion. Server-side insertions are less likely to freeze or buffer on viewers.

Lastly, server-side insertion provides more consistent ad quality and reliability. Ad stitching with server-side insertion fits ads seamlessly into video content, promoting higher engagement.

Tags Used for Communicating With OTT Devices

VAST Tags

Video players look at VAST tags for information on how to place and structure ads. VAST tags also tell players whether viewers can skip the ad and how long the ad runs.

VPAID Tags

Video player-ad interface definition (VPAID) ads improve VAST tags and allow for interactivity in ads. Brands also use VPAID tags to gather viewability measurements, which is why most ad agencies favor VPAID tags over VAST tags.

Challenges of OTT Advertising

OTT advertising carries several advantages compared to cable TV advertising. Here are some of the biggest challenges for OTT advertising to overcome in the future.

•  The OTT advertising landscape is still relatively new and lacks substantive industry standards for ad distribution, delivery, and insertion. As such, two OTT platforms might have completely different methods for handling OTT ads.
• OTT platforms on devices like Roku or Apple TV lack features that web browsers have, like cookies and flash support. These limitations limit the kinds of ads that brands can run on these platforms.
•  Due to the fact that OTT ad delivery is still fragmented, measurements on one platform might be different than on another platform. These discrepancies can lead to confusion when analyzing ad reach and performance.
• OTT platforms can’t produce the interactivity of browser-based ads as most platforms cannot parse VPAID tags instead of VAST tags. The result is that OTT platforms lack the analytics and engagement that VPAID ads can bring.

Ready To Launch Your OTT Advertising Campaign?

OTT video is the advertising of the future. As traditional TV continues to decline and internet video becomes the dominant way to consume entertainment, OTT advertising will expand to new frontiers and provide new opportunities for brands.

The Remnant Agency specializes in unsold ad space for TV and digital platforms. Our approach to buying unsold ad space allows you to maximize your reach while increasing your ROAS simultaneously. If you’re to take full advantage of the new frontier of OTT video advertising, contact The Remnant Agency today and schedule a strategy session.