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What Is OTT Advertising? A Detailed Guide for Beginners


OTT (over-the-top) is a service that streams digital content on numerous mediums, including TV, streaming boxes, consoles, HDMI sticks, and other Internet-enabled devices. OTT advertising definition sounds like this: the technology is similar to traditional TV advertising, only better, more cost-effective, and targeted. At OTT platforms, viewers enjoy series and programs and at some moment the ad appears.

OTT (over-the-top) advertising provides numerous benefits like better audience reach and convenience for both – advertisers and people at the screen.

If you are already familiar with the sphere of digital advertising, you must have heard about connected TV as well. We bet that you are wondering: what is the difference between these OTT and CTV? Well, to make your confusion vanish into the air, we will start our OTT guide with an explanation of these two terms.


OTT content appears on streaming services like SVOD or Hulu. Over-the-top means that you access content "over" the infrastructure providers: you can buy bandwidth from any provider, then subscribe to another one (like Hulu), which makes the initial provider just a layer, not the main way you are getting content. At the same time, CTV is a device or platform by which you receive the desired content. This might be Roku, smart or Apple TV. You need the device in order to view content that is streamed via the Internet connection. Let's continue defining OTT through its benefits and differences from CTV.


OTT video Advertising and its Strong Sides


Comparing OTT and CTV, it is worth mentioning that OTT content can be delivered via CTV devices. OTT mimics the traditional TV-watching experience but has lower costs and more flexibility due to the Internet connection. OTT advertising can be displayed before, after, or during the streamed video content. Some experts claim that OTT is the future of advertising and they have ground for thinking this way. Indeed, CTV devices and OTT services are extremely popular these days – they are almost everywhere.


According to the research conducted by 10th Degree, 75% of American families prefer over the top media services these days.

As a marketer or advertiser, you may find these numbers huge and promising. Let's discuss the strong parts of OTT as an ad channel to strengthen your suggestions:


Great targeting


Maybe, the best benefit of OTT is strong and accurate targeting. Advertisers are free to choose themes, locations, and demographics to display their content. Correct messages delivered to the right audience increases your chances to sell the product. In addition, focused ads and concrete scope save your time and money – you don't have to waste resources advertising for the irrelevant audience.


Flexible prices


The OTT marketing campaign can be very specific, regarding the type of business you own. Of course, like any other advertiser or business owner, you want to minimize the expenses and get the highest possible income. With OTT, you can track the results of your campaign and maximize its efficiency.


Strong analytics


It is important to understand the reach and relevance of your ads. Most OTT advertising platforms are packed with tools for measurement and analysis, which helps you retrieve information about customers' impressions. The tools allow you to sort data by targeting and other aspects to get different types of analytics.


In general, OTT allows the delivery of content directly from the web. CTV is simply a screen where the content along with ads is displayed. Despite the difference, these two are the parts of one whole.



OTT advertising and its strongest part: precise targeting




Let's talk about something that interests advertisers the most – targeting opportunities provided by OTT/CTV. This aspect is truly decisive when you are looking for the best way to deliver your ads. Here is what over the top advertising can offer in regard to targeting:


Household-level or addressable targeting


Addressable targeting is precise and scalable since it allows you to serve ads considering the location of your potential viewers. The technology uses GPS to target the addresses and make sure that the right households and devices are in focus. You can track thousands of addresses per one campaign and reassure that your content appears on the screens of people who really want it. No wasted impressions and vain advertising efforts.


Demographic targeting


Over the top ads can be delivered considering precise demographical data to allow advertisers to target relevant viewers. OTT platforms usually have numerous demographic variables for analysis and targeting. Using and combining them in any way one needs, it is possible to define the ideal audience. The basic variables are race, family size, income, educational level, location, and ethnicity.


Behavioral targeting


Behavioral targeting considers the online behaviors of viewers. This includes their previous browsing experience, used keywords, and themes they are interested in. Marketers stick to behavioral targeting because it is precise and highly individualized. What is more, it allows cross-device targeting - all users' actions


Methods and Formats of OTT Advertising


The format of an OTT add is determined by the way the platform interacts with an OTT device. There are two key methods to distinguish:


SSAI (server-side ad insertion)


SSAI ensures relevant and customized ad streams since it creates a mix of relevant ads in real-time and displays them to customers. What is more, SSAI evades ad blocks easily, which ensures that your ad will be watched entirely. SSAI provides a smooth watching experience - an uninterrupted video stream, where there are no pauses between actual content and ads.


CSAI (client-side ad insertion)


While CSAI enjoys leadership in the world of the OTT advertising industry, this method provides less flexibility and security. CSAI loads the content directly to the OTT channel before users see it. Being the pre-made method, it is not the most efficient way to display ads. What is more, such implementation increases risks of hacker attacks and data leaks.


Considering these two methods, streaming video advertising can be delivered differently. However, there is a general order followed in both cases:


Defining and creating a target audience


OTT allows advertisers to access users' subscription information and therefore get a foretaste of their preferences and interests. Advertisers find out which TV channels, shows, and categories interest a particular user or people who share the same household.


Audience matching


Then the audience is matched to particular TV subscribers on various platforms. The promotional media content is implemented, downloaded, and secured by OTT devices.


Ads displaying


At this stage, particular ads appear on users' devices considering their interests and previous actions.


Summarizing results


The OTT operator creates personalized reports and sends them to advertisers (first and third-party data included). Based on this data, advertisers can change and improve their strategies.



What Are the Types of OTT Platforms?


OTT video advertising can be delivered through different channels. They are:

  • Native OTT-services

  • Streaming services

  • OTT devices

  • Ad publishers

Let's stop on the most popular representatives you may already know:


Hulu


Hulu is a giant streaming platform where about 30 million people get their on-demand content. This service provides a feature-packed ad platform where advertisers enjoy targeting, measuring, and bidding opportunities for their ad campaigns.


Roku


Roku is a platform and a streaming tool at the same time. Its audience is huge – 37 million viewers, so Roku is considered as one of the largest services in the world. It is not only the leader but also a pioneer of OTT advertising. Advertisers can benefit from the rich list of Roku's offers that includes sponsorship, overlays, and interactive video content.


Tubi


Tubi's ad spots allow advertisers to broadcast 15 and 30-second videos that cannot be skipped. This is another popular OTT channel with 25+ million users.


If you are looking for the way to a big screen, then OTT platforms are worth your attention. The variety of offers is huge, so every business can find something suitable among the wide range of platforms and advertising methods.


Final Thoughts


Marketing and advertising sectors develop rapidly, which means that you, as a business person, should march in step with these changes. OTT is a technology that revolutionizes the entire advertising market and alters the way we perceive video ads. People prefer streaming and on-demand services over traditional TV today – they are willing to watch particular content that will entertain them for sure.


While the online content gains more and more individualization, ads follow this pattern, too. The most successful advertisers are those that work with personalized approaches and focused audience reach. All of these can be easily obtained by means of OTT. Besides, OTT platforms offer numerous opportunities for efficient marketing, like deep targeting, accurate results measurements, and flexible budgeting. This is still a pretty young technology and there is a great potential to be uncovered soon. Still, there is no doubt that OTT is a huge leap to the future and you should keep it in mind!