The Video Ad Market Is Booming: How Do You Make The Most Of It?

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Joseph Kinchin is the SpotX business development director. In this piece, he gives the lowdown on how advertisers can make the most of the booming video ad market.

The video advertising landscape in Australia and around the world is competitive, fragmented and rich in its variety of platforms.

The recent launch of Foxtel’s new service Binge and 10 Play’s app strategy exemplifies the sharpness of the competition. The free-to-air and pay TV broadcasters are experiencing ongoing declines in their linear audience, but this is being offset by double digit growth in their OTT (Over-the-Top) VOD services, which have grown 331 percent between 2015-19 according to ThinkTV data.

However, OTT is but one option on the wide spectrum of video advertising. It’s important to take a step back to consider the different opportunities available to understand which is best for your brand and objectives.

OTT

OTT services are now more popular than pay TV in Australia, led by Netflix and accelerated by fast broadband availability. CTV is the primary device for consumption, and is present in more than 50% of households and accounts for more than half of all OTT inventory.

Top OTT services are provided by free-to-air or pay TV broadcasters, such as Nine Now, 7Plus, SBS on Demand, and Foxtel Go, or non-broadcaster platforms e.g. Kayo Sport and Optus Sports, regional providers like Tubi (entertainment movies and shows), Bloomberg (finance and economic long-form content), Yupp TV (Indian and Bollywood content), Crunchy role (Anime) and global players like Disney+ which has gained 2m Aussie subscribers in 4 months. Advertising Video On Demand (AVOD) services are on the rise as subscriptions plateau around two to three subscriptions per household. There will always be a portion of consumers that prefer ad-supported, or free content services.

Because of its premium nature, OTT is ideal for brand building and driving awareness. The big screen experience and quality long form content provides a great ad experience for users (instream ads pre, mid and post roll). OTT is similar to TV but has other benefits – it reaches light TV viewers and is a great way to extend audience reach. The IAB estimates that co-viewership of a TV program means there is an average of 1.9 viewers per CTV device.

Brands can also layer in first and third party data to their media buy, delivering additional targeting capabilities, while digital measurement metrics offer sophisticated objective setting and optimisation. An OTT media buy also appeals to challenger brands who cannot afford to splash budgets on popular programming across linear TV where there can be a lot of wastage. OTT provides access to Australia’s most sought-after content including live streamed shows and sports with granular targeting. Buying this programmatically ensures that brands do not have to lock in spend commitments and only access the audience they wish to.

Online video

Video is unsurprisingly the most sought after inventory online with brands competing for premium local and global publications such as Nine Entertainment, MSN, Mail Online and Mamamia who serve instream ads adjacent to brand safe short-form video content within fact-checked editorial environments that deliver high viewability. Burgeoning online gaming platforms such as Twitch.tv and Playwire deliver pre and mid roll inventory at scale across both their highlights and live streamed gaming content.

Outstream ads are popular and commonplace where the ad expands and appears within the article as the user scrolls down. There are scale benefits for advertisers using outstream and reaching users fully engaged in reading article content, however it pays to fully understand the quality and measurement metrics around viewability and completed view rates.

Online video is a great compliment to OTT when looking to build awareness and reach more relevant audiences who are light TV viewers, helping to achieve wider audience goals. With the range of different environments and access to rich audience data it is an ideal channel to be more granular with your targeting and pinpoint in-market audience segments for example. This channel also provides a great environment to use shorter video creatives which appeal to users in a snackable short form video mindset and can act as a nudge to support your core messaging on OTT.

Native and App-based video

The native and app-based video market is a broad and diverse inventory pool which can appear overwhelming at first glance. Most are familiar with the big social media platforms who offer an array of native video formats that are often present in the news feed. Native ads are best used for mid to lower funnel objectives where you can use targeting to ensure you are being highly relevant to the content to maximise cut through and impact.

Outside of the walled-gardens, OTT, gaming and music streaming apps are the most prominent inventory sources with similar instream and outstream formats available. Additional formats include interstitials that appear as the user navigates through the app, appearing full screen delivering high viewability. Premium app providers like Nine Now and Spotify offer great formats for upper funnel objectives providing scale and reach for advertisers.

The app ecosystem has evolved immensely in terms of quality, targeting capabilities, brand safety and measurement in recent years. Gaming has officially hit the mainstream with broad demographic appeal and brand advertisers are increasingly embracing them. It’s imperative to work with the leading app publishers to ensure full transparency and deploy checks and balances with the likes of verification seller standards such as app-ads.txt. that enables a brand to buy app ads with confidence.

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