OTT: The New Source of Mobile User Acquisition

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By Dr. Gijsbert Pols, Product Strategist, Adjust

If there is one industry that has managed to profit from the pandemic it is OTT. Having to stay in their homes, people were eager to explore this new way of consuming content — accelerating an already apparent boom.

By now, advertisers are flocking to the phenomenon as well: according to SpotX, ad spend on OTT in August was up 60% compared to March this year. In other words, it is time for anybody involved in marketing to start discovering the possibilities of OTT as well.

What is OTT?

OTT stands for over-the-top. There are many different definitions out there, but all of them share the aspect of video content consumption without the interference of an intermediary, such as broadcasters, cables or satellites, by means of streaming.

Think about it like this: if you watch Game of Thrones on a TV channel, that’s TV. But if you stream the same show to your TV/mobile phone — that’s OTT.

Another important aspect is that OTT allows media content via any device, provided it has an internet connection and a screen. Surely, so-called connected or smart TVs are the most popular devices for OTT consumption, but gaming consoles and laptops are used as well. After television, the mobile device is the second most popular, with nearly a quarter of time spent using OTT on phones.

OTT in advertising: Push and pull factors

Because the best-known example of OTT is Netflix, which is ad-free, most people don’t immediately link OTT with advertising. Yet there is a lot of advertising going on, on OTT, and it is very likely that we are going to see a lot more.

Let’s start with a push-factor. With the emergence of many new platforms, particularly Disney +, the OTT market is going to be a lot more competitive in the next couple of years. This competition will be won by whoever has the best content, be it a hugely popular series like Game of Thrones or sporting events everybody wants to see.

Creating this content or acquiring the rights to stream it is a costly game. Up to now, most OTT platforms have financed their endeavours with subscription models. But there are limits to the number of subscriptions people are able to afford, as there are limits to the price of a subscription people are willing to pay. Advertising can fill the gaps, if only for a free tier.

There are several pull-factors as well, with the innovative potential of OTT probably being the biggest. OTT will allow advertisers to apply whole new ad formats, entice interaction with ads and minimize the customer journey with direct-buy options. And with all the data OTT generates on content preferences, we are going to see great opportunities for targeting, particularly for niche products.

The potential of OTT for mobile marketing

For mobile marketers, the innovative potential of OTT becomes even bigger to the possibilities for interaction between the TV screen and the mobile device. Roku, the main TV device supplier in the US, already allows people to use their smartphones as remote controls. This paves the way for enticing consumers to interact with the brands they see advertised on their TV via their mobile phone.

To give but one example: a food delivery company could stream an ad around dinnertime, incentivizing app downloads with a free pizza delivery within a certain time slot. Because let’s face it, we all have been in situations where we did not want to walk away from the TV for food.

Ads are the future of streaming. As such, OTT will become an important factor in mobile advertising — with huge potential for innovation.

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