Cord-Cutting: What Local TV Stations Need to Know

Amrita Hemdev
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By Amrita Hemdev
April 11, 2018
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Television is a captivating medium for video advertisers looking to target local consumers. It gives a premium advertising experience and is ideal for promotion, but it lacks other digital targeting capabilities that advertisers have grown accustomed to.

Henry Ford said, “If I had asked my customers what they wanted, they would have said ‘faster horses.’”  Just as Ford revolutionized transportation, the advertising world has also revolutionized the way all of us in media think about how we connect to audiences and earn revenues.

The latest pay TV trends report from TiVo illustrates a growing batch of consumers who can no longer be reached with TV advertisements. Nearly 15 percent of U.S. households no longer subscribe to a pay-TV service. Enter over-the-top video (OTT), which not only offers a comparable quality level with television, but also offers the additional ability to target consumers based on particulate audience attributes. OTT viewers are a subset of connected TV users who stream video content via an app or website that bypasses traditional distribution. Examples are HBO Now, Hulu, Netflix, and even local TV station apps on Roku.

According to eMarketer in August 2017, for the first time, more than half (51.5 percent) of the U.S. population has Internet-connected TVs—via a smart TV or a TV with an attached device, such as a USB stick or gaming console. That figure is expected to grow to 57.7 percent by the end of 2021.

 

Cord-cutters and cord-shavers aren’t just millennials anymore. More than half of the members of the U.S. population are now Connected TV users. OTT is quickly growing into a strong platform to reach local audiences in a lean-back experience." 

Aman Sareen, Co-Founder and CEO, ZypMedia

 

OTT DMAs

 

Should local TV stations worry about the growth of streaming-video-on-demand (SVOD) and over-the-top (OTT) advertising?

We don't think so, and here's why:

OTT is an easy segue to selling digital

It is easier for advertisers who have never sold digital ads before to sell OTT ads. Broadcast stations are used to selling TV ads, and OTT ads give a similar end experience to the viewers.

ZypMedia captures spend traditionally reserved for local television and redirects it into OTT to enable more effectively planned and executed video advertising campaigns. The data available in OTT allows us to identify precise groups of consumers within local areas.

 

“We see immense value in continuing to advance our OTT technology to share with our partners. We help them unlock incremental digital spend by supplementing their broadcast offerings with forward-thinking digital products, enabling their local advertisers to tap into the opportunity created by the viewer migration to OTT.”

Kevin GianatiempoChief Revenue Officer, ZypMedia

 

Capture budgets during political cycles

Due to the nature of the technology and delivery options, there is more video inventory available in OTT than in broadcast.

During elections, political ads capture the majority of slots of advertisements on TV by pouring in dollars and bidding high for space. Other verticals like automotive, retail, etc. are pushed out from political broadcast due to this.

Don’t let business get away from you during a political cycle. Instead, capture their budgets by selling them OTT as an alternative lean-back solution. There is an excellent opportunity to win the budgets from these verticals by selling them OTT ads.


Don't be afraid of the cord-cutting trend. Instead, leverage the power of OTT to stay connected to consumers. We specialize in local digital advertising and we’re innovating to bring local advertisers the best OTT technology.

Learn how ZypMedia brings the best local OTT options to advertisers by working closely with SpotX, the leading video advertising platform that enables publishers to monetize content across desktop, mobile, and connected TV devices.

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Picture of Amrita Hemdev

Amrita Hemdev

Amrita is an inbound marketer. She studied marketing and project management at UC Berkeley and proceeded to work in a fast-paced, digital advertising tech startup, with a goal of increasing brand awareness. She is currently the Content Marketing Coordinator at ZypMedia. Passionate about digital marketing and having five years of experience in this field, she also started her digital marketing and creative agency, Sociato, based in India.
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