The Many Facets of OTT and Its Expansion – A BIA Webinar Explores the Landscape

OTT has been a hot topic, made even more so by the fragmentation of television and the advancement of streaming options. To better understand the current OTT market and its expansion, Mitch Oscar, Director of Advanced TV Strategy at USIM and Rick Ducey, Managing Director, BIA Advisory Services, presented a panel of experts last week that included Kemal Bokhari, GM, Data and Analytics at Dish, Jessica Daigle, VP Sales Intelligence at Tegna, Nelson Ferreira, Senior Director, Regional Sales at Gamut, Justin Fromm, Head of Research at LG Ads, Phil Herring, VP Digital Strategy at USIM, Jo Kinsella, President at TVSquared and Adam Noble, Director of Product Marketing at Advanced Video.

The Challenges and Opportunities in OTT

OTT is not without its challenges. For Ducey, the biggest challenges to OTT today are, “Fragmented inventory, cross-platform measurement of linear TV + OTT, frequency capping and applying linear TV business rules using pods, pod positions, brand separation, brand safety, etc.”

But according to Noble, “OTT is not as hard as we think it is and as many perceive,” and while, ”there is a lot of disruption in the industry, any new method of reaching viewers is going to create new opportunities for advertisers in the industry.” Owners can now go direct to consumers, there is a splintering of buying opportunities and channels and the replacement of certain hardware such as set top boxes facilitates the convergence of linear with digital. There are also many new competitive entrants into the space like Pluto TV, “which gives consumers the option to view for free.” All of this impacts the business model.

“Confusion is driven in large part by fragmentation,” he noted. This confusion drives the need to sort through ownership of data, the coordination between services for a seamless advertiser buy and the lack of measurement standardization. “Who has the right to sell what inventory,” he queried, and how can it best be measured?

Yet, a myriad of opportunities abound in OTT. Ducey listed, “Converging the power of digital targeting, workflow, optimization, attribution with the power of premium OTT video combined with linear TV at scale.”

The Importance of Incremental Reach

For Daigle, “Fundamentally, OTT was formed to fulfill a promise of bringing together what I like to think of as digital superpowers of measurement, targeting with the magic of sight, sound and motion. That is why attribution, measure-ability, reach extension, etc. are so critical.” She added that the stakes are higher as clients are demanding more.

Ferreira agreed that, “Brands are demanding more of us, especially in local where it is harder to measure and define those attributes. That challenge is even more challenging.” To that end he is working with clients on solving for reach extension through frequency capping and recency capping.

Television’s overall value is unsurpassed in the marketplace. Fromm explained that, “TV remains one of the most if not the most important medium for many advertisers,” in both national and local. “It also enables tremendous reach in a short period of time. But linear viewing has changed drastically over the last decade or so.” This reduction in viewing underscores the need for reach extension in the OEM universe. “Reach extension is certainly something we are thinking about and the OEMs are well positioned to do.”

According to TVSquared’s recent survey on CTV engagement, Kinsella noted that, “the main reason for advertising on streaming was incremental reach. The people that we surveyed 70% cited the ability to extend reach and engage with audiences beyond linear was why,” they advertised on CTV. She added that, “17% said that understanding deduplicated and incremental reach across streaming platforms is their biggest barrier from fully leaning into streaming.” She advised that we have to be cognizant of the walled gardens and OEMs. “Most of the time they can only measure their data, their piece and more and more, marketers need to be able to measure everything.”

Bokhari noted that reach extension is, “an important part of the advertiser’s strategy to continue to maximize their reach for their ad. What we have done at Dish is to utilize our addressable technology, our viewership data to be able to let the advertiser know what their reach was on the Dish platform for that linear ad and then be able to target one-to-one to those household that were either missed, not exposed to that ad or who were underexposed and create a plan to maximize their reach.”

From the agency perspective, Herring explained that, “We are being held more and more accountable for the media we purchase on behalf of our clients. So while it is hard to make a one-size-fits-all statement when it comes to reach extension, it depends on the campaign, I would say the majority of campaigns, reach extension is important especially in the CTV space.”

The Future of OTT

The Future of OTT is bright. Ducey concluded that three years from now, “In local OTT, BIA is forecasting nearly 2x the ad spend we’ll see in 2021. I suspect we’ll adjust that to be both sooner and higher as time goes on. The industry is working toward an environment where impressions-based trading, measurement, and attribution will have increasingly less friction in cross-platform (linear TV + OTT) activations. I see linear for reach and OTT for targeting and extension to reach non-linear audiences. Linear and OTT will make a formidable 1-2 marketing punch in local video.”

This article first appeared in Mediapost.com