Ever wondered why so many OTT platforms are switching to advertisement on their platform? Firstly Disney+ then Netflix and now even Prime Video?
It is not only to lower the subscription fee and reach a wider audience.
Advertisements on premium over-the-top (OTT) platforms have been found to generate higher product and brand recall compared to ads on smaller mass-market services, including platforms featuring user-generated content (UGC).
The study, consisting of two phases, was carried out by Milieu Insight from January to April 2023, focusing on the effectiveness of advertising in different digital environments. The second phase, which delved into customer attention and recall of advertisements in premium OTT and mass streaming environments, corroborated the initial findings.
The research unveiled a significant 10% increase in product recall and a 12% rise in brand recall for ads displayed on premium OTT platforms in comparison to mass streaming environments. Furthermore, the study observed notable discrepancies in consumer behavior when exposed to ads in premium versus mass environments, particularly in terms of subsequent actions taken. Those who encountered ads in premium environments exhibited a higher likelihood of engaging in actions such as searching for more information about the product, visiting the brand’s website, and reading reviews. This indicates that ads shown in premium environments are more likely to yield higher conversion rates.
The first phase of the research had already established that consumers perceived premium OTT as higher quality (58% OTT versus 36% mass) and garnered more attention compared to mass streaming video environments (49% OTT versus 35% mass).
AVIA’s CEO, Louis Boswell stated, “The results are definitive and support what we have long felt obvious – ads that are shown in premium OTT services are more effective than those you see in social media or video sharing services.”
As OTT continues to experience substantial growth, it presents an underexploited and unique avenue for advertisers of all kinds to optimize the effectiveness of their campaigns.
The findings underline the potential of OTT as a burgeoning advertising medium, urging advertisers to reassess their strategies and seize the opportunities presented by this rapidly expanding platform.