What Is OTT? A Comprehensive Guide for Businesses
Understanding OTT Services
OTT, or Over-The-Top services, refers to media delivery that bypasses traditional channels like cable or satellite providers. Instead, OTT content is streamed directly to consumers over the internet. Popular OTT platforms include Netflix, Hulu, Disney+, and Amazon Prime, but the term has evolved to encompass a variety of content types, including video, audio, and even messaging services.
At MLCworks, we understand that OTT advertising represents a tremendous opportunity for businesses to reach their audiences in an environment that is rapidly growing and changing. If you’re considering incorporating OTT into your marketing strategy, here’s everything you need to know about OTT and how it can benefit your business.
The Growth of OTT: Why It Matters to Your Business
The OTT landscape is expanding at an astonishing pace. By 2024, the number of OTT users worldwide is expected to surpass 3 billion, while the global OTT market is estimated to reach over $194 billion. This massive growth is largely driven by the shift in consumer behavior, as more people cut the cord and turn to online platforms for their entertainment and content needs.
Key Benefits of OTT for Businesses
For businesses, OTT offers several significant advantages:
Targeted Advertising
With OTT platforms, advertisers can use highly specific targeting methods, including demographics, interests, behaviors, and geographic locations. This allows your business to tailor content directly to the needs of your audience.
Data-Driven Insights
OTT platforms provide robust analytics, allowing businesses to measure performance, track user behavior, and optimize campaigns in real-time.
Cross-Platform Reach
Consumers can access OTT content on multiple devices, including smartphones, tablets, and smart TVs, which gives advertisers more flexibility in reaching their audience.
Non-Skippable Ads
OTT platforms often offer the option for non-skippable ads, increasing engagement and ensuring that your message is seen by viewers.
Cost-Effective
OTT platforms often offer the option for non-skippable ads, increasing engagement and ensuring that your message is seen by viewers.
By investing in OTT advertising, your business can reach a more engaged audience while optimizing your return on investment (ROI).
Types of OTT Content and Platforms
There are various types of OTT platforms that businesses can leverage, depending on the kind of content they want to share and their marketing goals. Here’s a breakdown:
Subscription-Based Services (SVOD)
Platforms like Netflix, Hulu, and Disney+ fall under the Subscription Video on Demand (SVOD) category. These services provide content to users on a subscription basis, where they pay monthly or annually to access a catalog of movies, TV shows, and exclusive content.
Ad-Supported Video on Demand (AVOD)
Services like YouTube and Peacock operate on an Ad-Supported Video on Demand (AVOD) model. Users can watch content for free but will encounter ads at various intervals during their viewing experience.
Transactional Video on Demand (TVOD)
Platforms like Apple iTunes and Google Play operate on a Transactional Video on Demand (TVOD) model, where users purchase or rent individual pieces of content.
Hybrid Platforms
Many OTT platforms use a hybrid model, combining subscription-based services with ad-supported content. Hulu, for instance, offers both a premium ad-free subscription and a lower-cost option that includes ads.
Why choose MLCworks for
your media strategy needs?
Industry Agnostic
Whether you’re in healthcare, retail, technology, or any other industry, we’re excited to work with you. Our team has the expertise and versatility to build awareness for your brand, no matter the sector.
Confidence in Results
With our proven track record of success, we’re confident in our ability to elevate your brand’s visibility and drive meaningful results. From increasing brand awareness to driving conversions, we’re committed to helping you achieve your marketing objectives
Holistic Approach
We take a holistic approach to media strategy, considering every aspect of your campaign—from audience targeting to creative execution to budget allocation. With MLCworks, you can trust that every detail is carefully considered to deliver maximum impact.
How OTT Advertising Works
OTT advertising works much like traditional TV advertising but with more precise targeting and delivery methods. Here’s a quick breakdown of how it works:
- Ad Placement: Brands create video ads that are placed within the OTT content on platforms like Hulu or YouTube. These ads can appear before, during, or after a piece of content, depending on the platform and the user’s viewing experience.
- Targeting: Unlike traditional TV ads, which are shown to a broad audience, OTT advertising allows for hyper-targeted ads based on user behavior, demographics, location, and interests. This ensures that your ad reaches the right audience at the right time.
- Measurement: OTT platforms offer robust analytics and performance tracking, including metrics such as impressions, completion rates, click-through rates, and conversions. This data allows businesses to measure the effectiveness of their campaigns and make adjustments as needed.
- Cost Structure: OTT ads are typically sold on a Cost-Per-Million (CPM) basis, meaning advertisers pay a set amount for every 1,000 impressions. This pricing model can be more affordable and effective than traditional TV commercials, especially when combined with OTT’s advanced targeting capabilities.
OTT vs. Traditional TV Advertising
OTT advertising is often compared to traditional TV advertising, and while both have their place in the marketing mix, there are significant differences between the two:
| Feature | OTT Advertising | Traditional TV Advertising |
| Audience Targeting | Advanced targeting based on behavior, demographics, etc. | Broad reach, limited targeting options |
| Cost | Typically more cost-effective with flexible budget options | Higher costs, especially for prime-time slots |
| Device Flexibility | Available on smartphones, tablets, smart TVs, etc. | Limited to traditional TV sets |
| Ad Skipping | Non-skippable ad options available | DVR and ad-skipping options available for viewers |
| Analytics | Detailed performance metrics and real-time data | Limited performance data, primarily based on estimates |
At MLCworks, we understand that businesses need to balance both OTT and traditional advertising in order to reach their target audience effectively. That’s why our team of experts works to ensure that your brand has a presence across multiple platforms, maximizing your marketing efforts and ROI.
The Importance of OTT in a Multi-Screen World
One of the most compelling reasons for businesses to invest in OTT is the fact that consumers are increasingly using multiple screens at once. A consumer might be watching a TV show on their smart TV while browsing social media on their phone or checking emails on their laptop. OTT advertising allows your brand to be present on all of these screens, providing a seamless and consistent experience for your audience.
Cross-Platform Synergy
To further enhance your marketing strategy, it’s essential to align your OTT campaigns with other digital marketing channels. Here’s how MLCworks can help you create a cross-platform strategy that leverages the power of OTT:
- Social Media Integration: By aligning your OTT campaigns with social media efforts, you can create a consistent message across platforms like Facebook, Instagram, and TikTok, increasing the likelihood of conversion.
- SEO & SEM: Integrating OTT ads with your SEO and SEM efforts ensures that your brand maintains visibility across search engines while consumers engage with your video content. This enhances the overall user journey and increases the chances of customer acquisition.
- Email Marketing: By targeting OTT users who have interacted with your brand, you can create personalized email campaigns that nurture leads and drive them further down the sales funnel.
At MLCworks, we specialize in building cohesive digital strategies that maximize the impact of each individual channel while ensuring your overall marketing message is unified.
The Future of OTT and What It Means for Your Business
The future of OTT is bright, with continued growth and innovation expected in the coming years. As 5G technology rolls out and internet speeds increase, OTT will become even more accessible and integral to consumers’ daily lives. This means more opportunities for businesses to connect with their target audience in innovative ways.
At MLCworks, we are at the forefront of this digital evolution. We work closely with our clients to stay ahead of the latest trends and ensure that their marketing strategies are optimized for the future. Whether you’re just beginning to explore OTT or looking to enhance your current efforts, our team is here to guide you every step of the way.
Conclusion: Why Your Business Should Invest in OTT
Investing in OTT advertising is no longer optional—it’s a necessity in today’s fast-paced, multi-screen world. With advanced targeting, real-time analytics, and a cost-effective pricing model, OTT offers businesses a powerful tool for reaching their audience and driving conversions.
At MLCworks, we’re committed to helping your business thrive in the digital landscape. Our team of experts will work with you to develop a custom OTT strategy that aligns with your business goals and delivers measurable results.
Ready to explore the possibilities of OTT advertising? Let’s get started today.