This is Why Advertisers Will Buy OTT Inventory in 2018

Karen Sowa
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By Karen Sowa
February 05, 2018

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Consumer television has been continually evolving since the introduction of the technology almost 80 years ago. The latest advancement in TV is over-the-top (OTT), a way of delivering long-form film and TV content over the internet on connected devices, bypassing the need for users to subscribe to a traditional cable or satellite pay-TV service.

The next few years represent a pivotal time for advertisers to adapt to how US viewers are changing how and where they are consuming tv and video content.

US viewers are quickly adopting OTT watching habits. Cord-cutting is on the rise.

The ease and convenience of OTT streaming is causing US viewers to change the way they watch TV and video content. 

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In 2017, eMarketer reported a 3.2% surge in growth of OTT viewers compared to 2016. By the end of 2017, there were already 193.3 million OTT video service users in the US. This number is projected to consistently rise in the next few years to over 209.5 million OTT users by 2021.

Compare this explosive OTT growth to the consistent decline in of pay-TV viewers, and it becomes evident that, although the pay-TV model isn’t going extinct anytime soon, new opportunities for advertisers to reach US viewers are emerging with their adoption of OTT technology.

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Non-pay TV viewership is quickly growing as pay TV viewership continues to decline.

The overall number of cord-cutters (people who canceled their pay-TV service) and cord-nevers (people who have never subscribed to pay-TV at all) grew an overwhelming 15% between 2016 and 2017. The number of viewers that don’t pay for traditional TV services at all is predicted to increase to 81 million by 2021. OTT and digital video are the only ways to connect with this growing group of non-pay TV viewers via video content. 

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Advertisers are already experimenting with the OTT opportunity. Are you?

As OTT viewership continues to strengthen over time, advertisers are becoming increasingly interested in opportunities related to advertising alongside OTT content. OTT advertising is emerging as a leading strategy for advertisers to reach the growing number of young, affluent consumers who don’t subscribe traditional pay TV.

SpotX, the leading video ad serving platform, reported they saw an 18x increase in global OTT ad spend in 2017.  The percentage of ad budgets allocated to OTT advertising raised from 8% to over 26% in just one year. We’ve seen similar growth with OTT orders at ZypMedia, seeing a 570% increase in spending on OTT ads between 2017 Q2 - Q3.

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2017 was just the beginning of the growth of OTT advertising.

As OTT targeting technologies continue to advance, we expect OTT advertising demand to continue increasing at exponential rates.

Keep your eye out for break-through household level targeting and measurement capabilities to be introduced to OTT advertising in 2018, combining the top benefits of traditional pay tv and online video into one influential advertising solution designed for today’s audiences. 

You have questions about OTT advertising. We have answers. Contact us today to learn more about how an OTT solution can support your business growth.

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Picture of Karen Sowa

Karen Sowa

Karen is a marketer with almost a decade of success in solving business challenges with digital companies. She is currently the director of marketing at ZypMedia and can likely be found drinking an iced latte behind a laptop somewhere in the San Francisco Bay Area.
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