Over half of Americans are already using at least one over-the-top (OTT) service, with many users preferring to stream content on mobile devices.
For advertisers, this could present a unique opportunity, according to the latest 2019 OTT Consumer Report by OpenX which surveyed 2,000 US OTT users to find out more about their preferences.
OTT usage is particularly dominant among younger age groups (18-34 years; 65%). Interestingly, OTT usage isn’t just an addition to live TV. Instead, 15% of OTT consumers view zero live TV, but consume OTT content on a daily basis. And it appears they’re not sad about giving anything up with the majority of them (52%) saying they didn’t miss anything about live TV.
Many OTT users now view an average 2.5 hours of video content every day on smartphones.
Millennials spend even more time than the average on viewing OTT content on mobile (7.2 hours).
“Consumer attention is shifting significantly to OTT channels and this sea change in how we consume video content represents the most significant evolution in media consumption since the introduction of the smartphone,” said Dallas Lawrence, chief brand officer at OpenX. “More than half of all Americans now use an OTT service, and they stream a lot – more than two and a half hours every single day. With OTT now capturing a significant percentage of total consumer video time, yet less than five per cent of total television ad spending, an enormous shift in how marketers diversify their advertising strategy is on the horizon.”
Although subscription-based OTT services are traditionally ad-free, there is an opportunity for advertisers to address the ad-supported free OTT platforms. Indeed, half of respondents said that they would prefer ad-supported free services.
Advertisers are now spending almost $70 billion on TV ads, but less than 5% on targeted, addressable TV ads. At the same time, OTT ads are just as effective with 72% of consumers recalling ads and another 40% pausing content to make a purchase.
Among consumers who prefer ad-supported free models, they would watch 7-10 minutes of ads for an hour of free OTT content.
The opportunity for advertisers will be to unlock new potential within OTT whilst ensuring that ads remain relevant to their target audiences.