Video Essentials

The 3 Big Concerns Advertisers Have with Over-the-Top Video

What’s not to love about over-the-top (OTT) video advertising? Its viewers average a 98 percent ad completion rate (compared to 91 percent for tablet and 86 percent for phone). Also, 36 percent of its viewers watch for an hour or more, and those viewers are far younger than the traditional TV audience (with an average age of 31 compared to 54 for TV).

Talk to advertisers, though, and they still have concerns about jumping on board. According to “The Power of OTT: Audiences and Engagement,” a research report issued today by online video monetization company FreeWheel, advertisers have three main concerns with OTT:

  1. Viewability and Fraud: Marketers have the same concerns for OTT content as they do for desktop video ads—that their ads will be seen by bots or be hidden in unviewable locations. But OTT viewing is often authenticated and viewed on a television. This really isn’t the same as desktop video.
  2. Incremental Reach: Marketers often see OTT audiences as largely overlapping TV audiences they’re already serving with linear ad buys. But these aren’t the save viewers, FreeWheel says. Many of them have replaced traditional TV viewing with OTT and watch mainly during primetime. That means using OTT ads could be the only way to reach them.
  3. Audience Measurement Challenges: Okay, this one is a little true. OTT video doesn’t neatly fit into either online or TV measurement systems. FreeWheel encourages marketers to “be flexible and innovate.” To reach a young, affluent, and engaged market, it might just be worth it.

The report notes that 84 percent of OTT viewers use a TV connected device (such as a Roku or Chromecast), 11 percent use a game console, and 5 percent use a connected TV.

“OTT usage has surpassed desktop as the leading platform for premium video ad views in the US, and the devices are now firmly cemented in the ‘new living room’,” says David Dworin, vice president of advisory services at FreeWheel. “But despite the unique advantages these devices bring to marketers, the opportunity is growing faster than our ability to take advantage of it because of practices and assumptions brought over from other platforms. To move forward, we need industry-wide cooperation around standards for things like viewability and measurement before we can leverage OTT’s full potential.”

For more data on OTT video advertising, download the full report for free (registration required).


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