A Shift In Paradigm: Advertising On Television V/S OTT Platforms
Over the few decades, advertising has experienced some revolutionary and dramatic shifts. Across India, after 2018, the count of households subscribing to cable or satellite has continued to decline in recent years. According to a recent survey, 66% of households subscribe to at least one streaming service, and the average household subscribes to three or more.
The strike of the COVID-19 pandemic also has had a great impact on the OTT industry. A large number of people in India got attracted to these platforms. The success rate of the OTT platform almost doubled during the time of the pandemic. OTT platforms have grown by 75 to 150 percent in the last year. According to PwC’s Global Entertainment report, the OTT market in India is predicted to grow at 21.8% CAGR from INR 4,464 crore in 2018 to INR 11,976 crores by 2023. Advertising Companies can reach out to their core audience via video ads for as little as INR 75 CPM for a six-second video ad. The ad rates rise as the duration of the ads and the target audience increase.
With the day-by-day development in technology, OTT is occupying a place that has traditionally been occupied by primary television advertising, and it is becoming increasingly important for advertisers to consider the importance of this medium. As viewership is shifting from primary television to over-the-top (OTT) outlets, following this drift, TV, OTT, and programmatic advertising have become hot topics in the advertising realm. More and more people are "cutting the strings" from traditional television services and switching to OTT and streaming services for their daily content consumption.
As audiences migrate to OTT platforms, astute advertisers are allocating more of their budgets and assets to these portals. In most cases, OTT ads cannot be skipped, giving advertisers a better shot at getting their viewers to watch their ads. In contrast, most cable providers now offer DVR service, which enables users to skip commercials quickly. The period of time viewers ’ve spent watching live T.V. has dropped significantly and so have the chances of viewers seeing traditional television advertisements.
Dynamic advertising, on the other hand, is available through OTT, which means that different audiences can obtain various tailored versions of an ad. Advertisers can also see real-time data about how users engage with your product/brand after an ad is shown, including foot traffic attribution, sign-ups, purchases, and performance.
Advertisers are facing a steep learning curve as they transition from traditional TV to OTT advertising. Because the right message can be delivered to the right consumer at the right time, OTT advertising works. This data-driven, laser-focused approach is critical for brands seeking to market their products/services in a cost-effective and efficient manner. Without a doubt, video consumption will continue to shift away from traditional television and toward the internet-based realm of OTT. Advertisers would be wise to capitalize on this shift and the benefits of OTT.
The last word: The number of smartphones is increasing and internet charges are decreasing, which is giving way to an increasing number of consumers of online content streaming. You can reach viewers through OTT advertising that you would not be able to reach through traditional linear TV. Because of the rise in OTT viewer numbers, advertisers now have new ways to interact with their core audience by incorporating the impact of TV with the highly precise targeting of digital. Ad companies can now use OTT to monitor, evaluate, and retarget TV-viewing communities, giving a huge opportunity to reach more users.
Although OTT provides a plethora of options, it will undoubtedly provide even more in the future as streaming services and ad technologies evolve. Having taken it all into consideration, we can see that OTT advertising will have a much bigger share in the market, especially for OTT video content. Harnessing and leveraging this new technology to its full potential will become a priority for many businesses; brands will purchase OTT inventory and advertise on it since there’s nothing more engaging and immersive for users than TVs.
The Author is Arun Fernandes, Founder-CEO, Hotstuff Medialabs
