Alan Young | Broadband Technology Report | August 21, 2017
As consumer demand has rendered over-the-top (OTT) video provision a necessity, providers have been forced to look at how to monetize it. The market is highly competitive, the audience is fickle, and of course, monetizing digital content is almost as complicated as delivering it in the first place. In addition to subscription, OTT providers have also become reliant on advertising for revenue. But consumers are not particularly willing to sit through irrelevant ads, and this poses a problem for a business model reliant on advertising to generate revenue. In fact, a report from IPG’s Media Lab states that 65% of people skip online video advertising. The trick is to ensure a worthwhile experience for the viewer, as well as added value for the advertiser.
An effective way of doing this is to better target the ads to end users based on who they are, where they are and what device they are using. It is also important to ensure that the content surrounding the ads (including other ads) is contextually relevant. The “icing on the cake” scenario occurs when the advertiser can also understand what level of engagement the ad received. For example: Was it watched? Did the user interact or “click through”? Did they buy what was advertised?