Trends Shaping OTT: A Panel Wrap‐Up
A recent MediaRadar panel featuring industry leaders discussed how OTT advertising benefits brands through precise audience targeting and innovative ad formats like Hulu's interactive options, which enhance engagement and brand recall, while also noting the ongoing consolidation within the rapidly evolving OTT industry.
Last week, MediaRadar hosted a panel to explore the recent changes in OTT and what the future holds for this type of advertising.
The panel, moderated by Wendy Lee of the LA Times, included MediaRadar CEO Todd Krizelman, Bill Condon of Xumo, Justin Gutschmidt of Premion, and Matt Graham of Acorn TV.
The panelists discussed many aspects of OTT, including its benefits and how the industry has evolved this year.
Why OTT is Beneficial for Brands
OTT advertising offers several advantages to brands seeking greater value for their advertising spend. These include more views, higher click-through rates, and increased sales. OTT provides opportunities to deliver messages to the right people at the right time.
Targeting
OTT channels provide audience data that allows advertisers to create highly targeted campaigns. Advertisers can segment audiences based on geographic location, demographics, preferred content, and more. They can capture impression data and other metrics to guide future ad buys.
By narrowing an ad’s audience to only those for whom it is relevant, brands can drive awareness and save money by avoiding wasted impressions. Audiences also appreciate not being shown irrelevant ads.
Ad Space Innovation
While TV advertising has remained largely unchanged for decades, OTT platforms are introducing new ways for advertisers to reach audiences.
For example, Hulu offers a choose-your-own-adventure ad option, allowing viewers to select which ad they want to watch, including the brand and specific ad most relevant to them. Hulu also uses interstitial and binge ad options, where viewers can watch all their ads at once to avoid interruptions later.
According to Krizelman, these innovations are refreshing after a lifetime of identical TV ads. Hulu claims that these options lead to a 150% increase in brand recall.
Consolidation Marks the OTT Industry
As OTT content grows in popularity, the industry is beginning to consolidate. For example, Xumo was acquired by Comcast.
Bill Condon explained that being acquired by Comcast has been beneficial for Xumo in four key areas: distribution, discoverability, content, and data. With Comcast’s support, Xumo is reaching a wider audience, is easier to find, has seen a 350% increase in its content acquisition budget, and has access to more data and data processing tools.
Other companies are likely to undergo similar mergers and find similar benefits. Now that all major players have introduced their OTT platforms, the number of unique OTT providers will likely decrease. The average OTT consumer is willing to pay for about 3.2 platforms; beyond this, they are open to ad-supported OTT, which major leaders already offer (such as Peacock and HBO Max).
Krizelman noted that there was more M&A activity among their 2,400 tracked customers in the last 90 days than in any previous quarter over the past ten years. This consolidation suggests the industry has reached its peak in terms of the number of platforms, and as companies merge, new opportunities may arise.
An Exciting Future for OTT
With all the major players now in the market, the future of OTT promises to be interesting. As advertisers continue to capitalize on the benefits of OTT, its potential and profitability will become even more apparent.