Over-the-Top Advertising is a Top-Notch Opportunity

Posted on: October 5th, 2017

Over-the-Top Ads

In recent years, there has been a noticeable shift in the way viewers consume media. A major contributing factor to this transition is that buyers are becoming wary of rising cable bills and are looking for more affordable solutions. As a result, more people are making the switch from traditional services to over-the-top content (OTT), or content that is streamed through the internet. This shift from cable and satellite to streaming services has altered the way businesses advertise, therefore heightening the appeal of over-the-top advertising.

What is Over-the-Top?

Over-the-top primarily refers to TV and movies that stream over the internet, instead of through traditional forms, like cable or satellite. OTT also includes music and communication services, such as messaging apps. As long as users are using an OTT device, they have the potential to access media provided by a fast-growing list of apps. Examples of OTT devices include smart phones, smart TVs and gaming systems that offer internet connection and streaming capabilities. Through these devices, users can log into streaming services, such as Netflix, Hulu and Amazon Instant Video, to access desired content. Because streaming is completely separate from traditional services, it creates a whole new territory for advertisers.

Why Should Your Business Advertise Through Over-the-Top?

Advertise to the Cord-Cutters

A phenomenon that is affecting the cable industry is cord-cutting, which occurs when consumers discontinue their cable or satellite services in order to save money. Toward the end of 2015, one in five households chose to eliminate their cable. This decline in cable is not something advertisers should take lightly. TiVo recently asked 3,000 subscribers if they were planning on keeping their current cable or satellite plan. The survey revealed that an overwhelming 48.9% were preparing to remove their services or were at least considering it. Advertisers focusing on the cord-cutters should also consider the individuals who have never paid for cable or satellite services in the first place, a.k.a. the cord-nevers, which consist of 35% of millennials.

Over-the-Top Popularity is Growing

Even if a user isn’t necessarily a cord-cutter, OTT devices are clearly appealing to the masses. eMarketer found that about seven in ten U.S. internet users consume media through over-the-top video. As the demand for conventional services begins to dwindle, it’s clear that over-the-top is quickly becoming a preferred way consumers are choosing to view video. It’s also predicted that from 2015 to 2018, revenue from TV ads will decrease from $59.9 billion to $47.5 billion, while OTT TV ads will jump from $8.4 billion to $31.5 billion. This significant rise in OTT ad revenue suggests that advertisers should get in on the ground floor now.

Does Over-the-Top Reach Your Target Audience?

As we recognize the shift from television to over-the-top, advertisers should consider changing their approach. If your target audience is millennials, utilizing over-the-top advertising could be a strategic move.

Eight in ten millennials have a subscription to at least one OTT service, and 30% are considered cord-cutters, which is a market that advertisers simply can’t attain through cable alone.

As stated before, many consumers are unsatisfied with their climbing cable bills; however, there has not been a dramatic shift from traditional services to over-the-top. It’s still important to acknowledge that apps such as Netflix and Hulu are constantly attracting consumers. According to a recent study, every generation from teens to baby boomers said they most frequently watched TV shows through Netflix. Over-the-top streaming services that had 92.1 million global subscribers in 2014 are expected to escalate to 333.2 million by 2019, reaching even more audiences. 

As cable’s demand gradually diminishes, over-the-top services are continuing to flourish. It’s beneficial for businesses to seek alternatives, and over-the-top advertising is proving to be a valid option. Companies have the capability to target cord-cutters, as well as advertise through a medium that’s gaining momentum. Whether you’re planning on advertising through traditional services or are interested in expanding your options, a professional video marketing team will help you with all your advertising needs.

Create top-of-the-line advertisements by working with a professional digital and video marketing agency. Appleton Creative is an award-winning, full-service video and film production studio located in Orlando, Florida. Appleton works with local, national and international clients to deliver compelling visual stories that speak to audiences in the most influential way — through their emotions. Your video and film production goals are worth a conversation: contact us at 407-246-0092 or info@appletoncreative.com.


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