Yeah, OTT Advertising is a BFD

OTT Advertising

Torrential Logo“Welcome to the modern day gold rush of 2018 – OTT. If you are close enough to it, you can almost feel what the ‘49ers must have felt as those pioneers traversed the continental United States in hopes and dreams of found gold in 1849. Our version in digital media has all the smallest and largest companies grasping for some piece of the OTT pie (our gold) to market in the mega-billion dollar Video advertising industry.

Before I get started, it makes sense to present my take on the definition of OTT. OTT is TV on all screens delivered digitally. While OTT stands for “Over the top Television” it is in reality TV programming, digitally delivered on smart televisions, desktops and smartphones. The explosion of Apps now existent on all of these devices has made OTT the hottest form of media today.

Also Read: How ‘More of the Same’ Threatens the Future of Digital Advertising

The Small Screen is Driving OTT Advertising

The OTT opportunity represents the very best in advertising, akin to the opportunity that Online Video advertising represented when it debuted in the early 2000’s. First of all, OTT encompasses the finest quality programming available. A good deal of it is Network Television. Shows like Survivor and This Is Us would be great examples. Furthermore, even the biggest live events and sports are now available on OTT. Whether it’s by their own TV network provider or increasingly through other outlets like Twitter and Facebook, most everything makes its way into OTT.

A second reason OTT is today’s media gold is because it’s delivery is increasingly “app-driven.” Apps on your phone and on your TV make video viewing not only 100% viewable, they’re simply more pleasurable to watch. If you haven’t already, join the 193 million viewers of OTT by simply opening an app on your cell phone and watch the quality of the video stream in your hand — it’s outstanding. Contrast that with the quality of the video stream you’ve experienced on your desktop the past 10 or 15 years and it’s light years ahead. Now that’s viewability!

The final reason OTT has spurred today’s media gold rush is because it reaches the demographic advertisers most want to reach — millennials. The 18-34s that have largely left TV are now experiencing TV on their smartphones via OTT. They proudly refer to themselves as “cord-cutters” or even “cord-nevers.” Over 50% or 100mm of the 193mm OTT viewers are 18-34 (FreeWheel).

So if OTT is today’s media gold, why is it only a $3B business or small fraction of the $70B TV/Video industry?

Also Read: The Changing State of Mobile Video Advertising

It’s Too Hard To Do

Too many players make the space too hard to execute and scare advertisers away from the simplest and historically most effective form of video to buy: TV. The glut of players and quite frankly, too may bad actors, complicate OTT for today’s marketers. I know, because my company Torrential, and today ITN, work hard to simplify and sanitize it. Included in this ecosystem are the media companies (Comcast, CBS, FOX), Aggregators (Hulu, YouTube, Amazon), Programmatic platforms (Adobe, Tradedesk, and now defunct Videology) and online players such as YuMe and Oath. There are many more unmentioned. Until this herd thins out and winners and losers are proclaimed, it is wise to proceed with caution. My advice is to pick your partners carefully.

According to the IAB, OTT is destined to scale from today’s $3B to $40B by 2020: 133% growth in just 2 years! That’s why OTT is a BFD.

To all of us in this exciting new sector of OTT, if we’re to find that pot of gold in the end, we’ll have had to negotiate a very wild, western frontier. Now go grab your pick and pail and get at it!”

MTS
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