Roger Franklin | Videonet | June 21, 2018
It seems that the conversation on the growth in OTT is an old one – except it isn’t. OTT continues to strengthen, gaining more subscribers every week. As this happens, broadcasters are providing OTT capabilities alongside their traditional TV platforms, making targeted ad insertion even more crucial in the modern TV landscape.
For both OTT and linear TV, advertisements are the key broadcast revenue stream. In recent years, targeted advertising has been one of the strongest ways to generate more revenue as the advertisement is likely to be interacted with, and therefore, more valuable. Ads can be targeted based on location and viewer profile if the metadata has been applied correctly.
Why Replace Ads?
So, why replace advertisements in OTT? Because it boosts revenue, whether it’s pure linear TV, linear to OTT or pure OTT. To make the ad slots as valuable as possible, broadcasters need to make them audience relevant to increase the likelihood of engagement. However, with OTT, advertisements can become outdated as content can be viewed past the original airing date. Super Bowl ads may not make sense well after the event and may disengage viewers, reducing advertisement value.
Rights issues can also make OTT advertisements unusable. If a broadcaster has advert rights for a linear stream only, including the ad in OTT breaches that legal agreement. To fix this, you can replace the advertisement (preferred), or black out the content.
Replacing ads according to personal preferences and profiles makes advertising all the more appealing. This very personalized service generates additional value for all, including the consumer and the advertiser. All providers, both linear TV and OTT, should be exploring this possibility.