What Is OTT Video Advertising?

OTT advertising is a common term, often used interchangeably with CTV advertising. The exact OTT advertising definition refers to over-the-top ads through an internet-connected device. The OTT ads will be shown through applications that stream video content. No cable or satellite connection is needed for OTT advertising programming. For instance, Amazon Prime Ads appearing on the digital streaming service would be considered OTT advertising. OTT video advertising features specific digital ads with display videos and appears on OTT platforms.

OTT ads are considered the same as CTV advertising because OTT just refers to a larger platform. “CTV” or Connected TV means a television set connected to the internet. In comparison, OTT programming can be played on Connected TVs, but can also be streamed via mobile devices, tablets, or desktops. OTT advertising Amazon options will be considered the same whether you plan to target connected televisions or smartphones and tablets. OTT ads can be optimized for every device associated with a user for streaming.

OTT ads allow for superior targeting, much more so than linear television ads. Linear television ads are network and cable TV commercials. Linear TV spot pricing options are set at a premium. In comparison, OTT advertising is often available through auctions with a set budget determining the ideal placement. Advertisers can know ahead of time the exact audiences who will be viewing their ads. As an example, vacation retailers can choose to target viewers who have shown an interest in travel programming. With superior targeting capabilities, marketers can develop advertisements that appeal largely to their audiences. After OTT ads launch, marketers track engagement to determine if customer response is positive. It’s even a good idea to test a couple of OTT advertising commercials to see which ones garner the most conversions.

What is OTT full form? The full-form definition of OTT is over-the-top. If wondering what does OTT stand for, consider the idea that programming is going over the top of a cable box. The popularity of OTT came out of the trend of cutting the cord—meaning dropping subscriptions to local cable companies and satellite TV providers. OTT platforms such as Hulu, Peacock, and Apple TV, make money in several ways. The companies earn revenue from subscriber payments and ads. If subscribers prefer an ad-free viewing experience, they must pay a higher monthly rate. In turn, films and TV shows make money by selling their properties to OTT platforms. For instance, “Coming to America 2” was sold to Amazon Studios for $125 million, according to Variety.

What is OTT release? Before any programming releases on a streaming service, the production company receives a licensing fee from the platform. Multiple rights can be sold, especially if the film comes in a different language. OTT platforms would have to pay a licensing fee for each version. Films and TV shows auction off their rights to streamers, with the highest bidder winning. In many cases, the cost to purchase the film or TV show will be over the production budget. OTT platforms also have in-house productions which make exclusive content for their streaming services.

There are multiple types of OTT platforms, which follow different business models. In the United States, the following OTT platforms are some of the most popular:

• Peacock
• Amazon Prime Video
• HBO Max
• Hulu

The Amazon OTT platform and the Hulu OTT platform earn revenue from both ads and subscription packages. Amazon OTT ads bring in significant revenue since Amazon Prime Video access comes free with any Amazon Prime membership.

Hulu is one of the best OTT advertising platforms because of the large number of paid ad-supported subscribers. Close to 40 million subscribers have enrolled with Hulu and will view ads while streaming their programming options. Hulu pricing depends on what type of packages are selected by the user. Although basic plans cost under $10, the company has offered newer services such as Live TV and DVR storage. HBO, Showtime, and other premium channels can also be purchased through Hulu, instead of requiring a separate streaming subscription for each one.

Unless an OTT platform offers a free streaming option, they earn revenue from a blend of ads and subscriptions. Hulu formerly had a free subscription option. However, the company no longer offers it. Although earnings come from subscriptions, Hulu makes a solid portion of its income from ad revenue. Hulu plays video ads pre-roll, post-roll, and mid-video. In 2020, $2.9 billion of revenue came from subscriptions while $1.5 billion was derived from ad revenue, according to eMarketer.
Free OTT services will earn money exclusively from ad revenue. Examples of free OTT platforms include IMDB TV, Pluto, and Peacock.

A basic OTT platform meaning applications are developed for downloading through a connected device. How OTT works is relatively simple. Subscribers download applications onto their televisions or mobile devices. Once applications are opened, users can search for preferred content. Advertisements appear in multiple areas of the application. Banner ads pop up on home screens and include outbound or inbound links. Additionally, OTT ads may appear while users perform different functions, such as playing a video or pausing a video.

To consider how to buy OTT advertising, the simplest solution is for marketers must first decide on budget and goals. The average OTT advertising cost varies greatly, but most companies can develop a plan that works with their marketing budget. Companies like Keynes Digital offer packages for under $10,000 as a way for brands to test out the medium.

When buying OTT advertising space, marketers have two options available. The company could purchase directly at a set price. The more popular option for OTT ads is via programmatic buying or bidding. Auction types of OTT advertising buying are known as programmatic. Programmatic auctions are automated, but still fully customizable to the advertiser’s needs and audiences. Advertisers gain access to a multitude of OTT platforms with the ability to appear on different content. Depending on results, programmatic buying can be frequently retargeted to improve return on investment. For direct buying, ads appear exclusively on a specific OTT platform. Direct buying also tends to be more costly than auction-type formats.

OTT advertising examples help the digital marketer view what works and what doesn’t in the space. For starters, look at the specifications required by the OTT platforms. For instance, Amazon Video Ads require a 15 fps rate, a preferred dimension of 16:9, and a bit rate of 2 MBps. Video duration times on Amazon Video are flexible with allotments ranging from 15 seconds to 3 minutes.

View an OTT ads example by visiting the streamers the company intends to appear on. Look at the message each brand is conveying and judge whether the content reflects the core values of the business. Does the video look professional? Does the script sound natural? Is text used effectively in the video ad? Do customers understand the call to action? Is the content relevant? Ads should add value and not be seen as an interruption on the OTT platform. The best OTT marketing examples grab a person’s attention immediately and let the consumer know what brand is being advertised. And an example of OTT advertising and how it may be put into action is to produce a non-skippable in-stream ad. To learn more about how what your video assets may need, visit our TV Commercial Reviews page.

The OTT advertising 2021 opportunities will continue to grow throughout the year. With more and more households watching streaming content, the more likely that targeted ads will get in front of the right consumer. The benefits of OTT advertising include improved metrics, increased reach, and streamlined campaign optimization. Advertising on OTT platforms is a straightforward process with users gaining more control over inventory options.

Reach out to Keynes today to discuss available OTT ad inventory and any inquiries about how to buy OTT ads. With partnerships with the top names of OTT examples in the industry, such as Hulu, Peacock, HBO Max, and more. OTT ads can introduce consumers to a brand or be utilized for retargeting users who have already shown an interest in the company.