The buzz around the prospects for over-the-top video is everywhere. Can’t deny it. But how mature is today’s business itself?
Compound the broad reach of traditional TV but powered by the best parts of digital buys — advanced targeting, dynamic ad insertion plus advanced analytics — and what you get should equate to the perfect marketing vehicle. What you can actually deliver is not quite that cut-and-dry at this point in time.
There is no denying the industry desire — to put it bluntly, traditional linear broadcast is on life support. As cord-cutting continues to accelerate, broadcasters are scrambling to reinvent themselves to leverage sight, sound and motion at scale much in the way digital media companies raced to reinvent themselves with the onset and adoption of the mobile-first and app-first media mindset. They are trying to avoid being viewed in the same bucket as old media, and banking on OTT to ride the next wave at the intersection of media, data and creative.
But there’s a long way to go until OTT fulfills that promise.
Here’s why: Television is already too far behind. The television set used to be the centerpiece of your living room. Not that long ago, parents and children shared the remote and watched shows together. Now we all have a device in our pockets and the options are endless.
For OTT to reach its full potential, there are three ways it must shift — or, more accurately, mature — to provide the same benefits advertisers have come to expect from mobile-first, data-driven video advertising companies. If there was any model it must follow, mobile is it.
Data must be defined and available: In mobile, data is closely defined (location, purchase intent, etc.) and there are highly specific parameters which inform an advertiser’s targeting. Most of these are not present in the OTT space today, or at least it feels that way. I would wager that my next-door neighbor is not receiving a more personalized ad experience than I am when he’s watching the same show on Hulu.
Data in the mobile video space is also nonfragmented and virtually universally accessible with the right partnerships. In the OTT space, because the source is the major media companies (i.e., AT&T, Comcast, Verizon), there are multiple walled gardens that prevent open sharing of data, hence limited availability.
There must be universal measurement: Currently, OTT measurement is an enormous challenge. Historically, Nielsen has been the universal currency for measurement, but now up-and-comers are mounting a challenge in a tremendously disruptive new way, reminiscent of what happened in mobile a few years back with the emergence of DoubleVerify, MOAT and IAS, who came in and put a stake in the ground around measurement and now find themselves reaping the benefits of an industry calling for a new means of accountability.
I don’t foresee the OTT space agreeing on or accepting widely defined measurement solutions and standards any time soon. There are just too many cooks in the kitchen and the big players in OTT are motivated by their own outcomes, which will ultimately push away from a consensus approach and toward awkward consortiums and fragmented directions. This, in turn, will not bring any benefits to the buy side, and we’ll still be stuck where we are today.
Reach, frequency are key: Reach and frequency have always been the two core variables by which media is bought and sold. But maybe this needs to be rethought so that we can level up as an industry. A decade ago, mobile was starting to pick up momentum and print was still a part of every plan. Jump to 2018 and beyond, to a world where print is dead and linear TV has been supplanted by social for efficient reach. How do you account for reach and frequency without the limitations of social creative capabilities or brand safety concern? Agencies don’t turn to OTT; they turn to mobile to deliver dollars and outcomes.
So where does this leave us?
Exactly where we started: Interested and optimistic about the long-term possibilities, tracking OTT innovation and progress, but not throwing all of our eggs into the basket. If you put everything into something that is still in its nascent stages, you’re investing in its potential — and I don’t have to tell what happens when you hedge too far and speculate on blind “potential.” (My apologies if you are reading this and were long on bitcoin).
Carpe diem. The future is now: Today’s reality is that people are consuming more video than ever on their mobile devices. The app is the new TV channel, but fewer teenagers want their MTV. By investing their marketing dollars on mobile video, marketers can leverage media, data and creative in a way that they can still only aspire to with OTT.
So don’t live in the possibility of what’s to come, take advantage of what you have in your hands today. If there is a possibility of mobile and TV working together — perhaps a combination of upper funnel and lower funnel messaging taking place on your phone and TV — then do it. But make mobile video your primary focus and know that the promise of OTT is waiting in the wings.
Matt Barash is head of strategy and business development at AdColony.