As the world adapted to the pandemic and phrases like “the new normal” became the new normal, activities that once relied on in-person attendance found new homes online. While viewership was already shifting from traditional cable TV to over-the-top (OTT) services and connected TV (CTV), the pandemic put this shift into overdrive.
In the first few weeks of the pandemic, 20% of adults attended a virtual concert, 18% participated in an online fitness class — and viewership of streaming services increased by a staggering 85%.
The return to in-person events in 2021 may make the once-novel virtual happy hour go the way of the dodo bird, but consumer demand for the flexibility and accessibility of streaming content continues to rise.
According to a recent poll of 1,200 consumers from The Drum and YouGov, two-thirds of respondents expect to watch the same amount of streaming television over the next few months. One-fifth of respondents aged 18 to 29 plan to watch more streaming content than before. Streaming is one behavior change we can expect to remain permanently.
To reach these expanding audiences, 60% of US advertisers are planning to move ad spend from linear TV to CTV or OTT this year and take advantage of the unique opportunities in this emerging market.
Opportunities in OTT
- Ad-supported video
While the average household added one new paid streaming service in 2020, SpotX’s 2021 Global Video Advertising Trends report shows that 60% of US CTV viewers prefer ad-supported content over paid ad-free services. The growing OTT and ad-supported video-on-demand (AVOD) marketplaces present advertisers with increased inventory selection across a variety of categories and new opportunities for incremental reach.
- Audience targeting
The consumer shift from traditional TV to OTT platforms lets advertisers better segment viewing audiences, present personalized ads using first- and third-party data, and efficiently move consumers through their marketing funnel. Retargeting and cross-channel marketing can also be achieved through innovations in automatic content recognition and tracking technologies.
- Dynamic ad insertion
The ability to personalize ad creative on the fly empowers advertisers to optimize campaigns in real time. By leveraging geographic, demographic, and behavioral data, advertisers can ensure viewers are served relevant ads at the right time with the right frequency, resulting in increased conversions and a greater return on ad spend.
- Improved performance analysis
With advanced performance and attribution metrics, like those provided through SpotX’s Measurement and Attribution Suite, advertisers can take an iterative approach to their CTV planning and adapt future campaign strategies based on past performance. Data around user behavior during and after viewing offers valuable insight into which ads are working and which aren’t.
Obstacles to continued growth
While overall OTT and CTV ad spend is expected to grow in 2021, CTV ad spend accounted for only 3.5% of total media ad spend in 2020. With growth comes growing pains, and OTT and CTV aren’t immune to challenges.
- Measuring engagement across channels
Though measurement capabilities are evolving, the reality is advertisers face a fragmented supply landscape. There are a number of ways viewers can access CTV and OTT content, which means advertisers need to orchestrate their buys across a growing number of devices, programmers, and distributors. This complicates targeting, measurement, and attribution. Working with a single source of supply can help overcome the fragmentation challenge, improve cross-screen measurement, and effectively show how video ad spend across OTT channels leads to tangible outcomes.
- Fraud prevention
Ad fraud tends to follow where the ad dollars flow, and OTT is no exception. As regulations race to catch up with the OTT landscape, ad fraud prevention is crucial to maintaining the integrity and ROI of OTT advertising. By taking a multifaceted approach that includes thoroughly vetting ad inventory, monitoring invalid traffic, and adopting the updated ads.txt standard introduced by the IAB Tech Lab, supply-side platforms (SSPs) can provide transparency to both buyers and sellers.
Learn more about how to benefit from adding CTV to your media plans and improve your return on investment in the latest SpotX University course, “CTV Is for Everyone: A Buyer’s Guide to Connected TV.”
About this post:
This post is Kristin Butcher’s introduction to the SpotX blog, as she is one of the newest additions to the Product Marketing Team. Stay tuned as you’ll be reading more of her insights and perspectives over the coming months.
SpotX is always hiring. Reach out to learn about future opportunities.
As Product Marketing Manager at SpotX, Kristin Butcher creates and executes go-to-market strategies for many SpotX offerings. Prior to joining SpotX, she worked in both marketing and public relations after spending several years as a software engineer. In her free time, she’s usually mountain biking, climbing, and trying to convince others that chips are a perfectly acceptable breakfast choice.