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How Much Does OTT Advertising Cost


How Much Does OTT Advertising Cost

With the number of OTT Platforms on the rise, you may wonder how much does OTT advertising cost. Unfortunately, the answer is not a simple one. There are several factors that can affect the cost of OTT advertising, including the platform you choose, the length and type of ad, and more. With the increased adoption of video content on laptops, tablets, and smartphones, more people are watching it. With this change, marketers and advertisers have followed suit by increasing OTT advertising spending.

With 62% of American households subscribing to streaming services like Hulu, YouTube TV, Paramount +, Sling, and other devices like Roku, Apple TV, and Amazon Fire TV – OTT advertising has emerged as a new and cost-effective advertising delivery.

Brands can now connect with customers directly in their living rooms and bedrooms, on laptops, connected TVs, tablets, and mobile phones, and focus on their preferences and interests in a way that traditional TV advertising never permitted.

What is OTT Advertising?

OTT advertising is the placement of ads on Over-The-Top (OTT) platforms. OTT platforms are digital media services that are delivered over the internet without the need for a traditional cable or satellite TV subscription.Some popular OTT platforms include Hulu, Netflix, Amazon Prime Video, and HBO GO.

Advertisements may be purchased programmatically by advertisers to OTT platforms and media companies, allowing for more cost-effective personalization.

According to a BIA Advisory Services study, OTT local ad spending is expected to rise from $1.18 billion in 2020 to $2.37 billion in 2025, with OTT advertising ad expenditures growing year-over-year and surpassing TV as a whole in total advertising spending.

How much Does OTT Advertising Cost in Terms of Ad Spend?

In recent years, Small and medium-sized businesses have had difficulty competing in the television advertising industry due to the increased popularity of streaming content and OTT advertising. You may start with a budget of around $2000 per month, then adjust ad spending based on brand demands and overall performance.

Some platforms may need higher monthly expenditures, but OTT advertising generally offers more choices in terms of price. CPMs for OTT advertisements range from $25 to $40 (cost per 1000 impressions/tv spots). This indicates that you are only charged when someone views your advertisement.

Depending on demand, traditional TV advertising costs anything from $40 to $200 or more per thousand impressions (CPM). Unlike OTT advertisements, there is no mechanism for tracking who or how someone sees your ad. The inefficiency of TV ad spending in terms of reaching people you don't want to reach, as well as limited monitoring capabilities, indicate that OTT advertising is a more effective use of marketing dollars.

To better understand how much does OTT advertising cost for your business, let's take a look at some of the most important factors to consider.

1. The Platform You Choose

One of the first things that will affect the cost of your OTT advertising is your chosen platform. There are several different options, each with its own pricing model. Some platforms charge by impression, while others charge by video view or click-through rate. It's important to do your research and find the platform that best fits your needs and budget.

2. The Length and Type of Ad

Another factor that will affect the cost of your OTT advertising is the length and type of ad you create. Shorter ads tend to be less expensive than longer ones, and static ads are usually cheaper than video ads. Remember that the price may also vary depending on where your ad is placed within the content. For example, ads that appear before or during a video may be more expensive than those that appear after the video has ended.

3. Your Target Audience

The size and demographics of your target audience can also affect the cost of your OTT advertising. If you're targeting a large audience, you can expect to pay more than if you're targeting a smaller, more specific group. The same is true if you're targeting a high-income or highly-educated audience. The more specific your target audience, the higher the cost will be.

4. The Frequency of Your Ads

Finally, the frequency of your ads can also affect the cost. If you plan on running your ad multiple times per day or week, you can expect to pay more than if you only run it once. This is because OTT platforms typically charge based on impression, so the more your ad is seen, the higher the cost will be.

Things to Consider For OTT Advertising Video

1. You'll need to establish the following data

Name of your channel, viewable ad duration, target audience, and format. While you may want to create a quick video and submit it to your OTT buying platform, programmatic and direct buy platform demands must be met. A few basic best practices will allow you to get the most out of your OTT advertising spend.

2. Keep It Short

People have limited attention spans, so your video should be kept to a few minutes. You want it to be as short as possible while conveying the necessary information. Whatever non-skipping features you add, someone will lose interest if it goes beyond 60 seconds.

3. Format for Multiple Devices

You may not know all the different devices on which you'll be able to place an AD, but knowing that these ads can appear across various platforms, from mobile to desktop to smart TVs, should help. Narrow down your sizing choices based on best practices and optimize for each device type.

4. Personalize Your OTT Ads

Over-the-top advertising provides a wealth of tracking data, so use it to develop advertisements that speak directly to your target audience. The appearance, sound, and feel of your film should reflect those your audience's preferences and interests.

Conclusion

In order to decide if OTT advertising is the right investment for your company, it’s important to understand its benefits and how much does OTT advertising cost. So these were some of the pros of OTT advertising and how pricing can vary depending on several factors. By checking the tips before choosing your preferred OTT platform, you can better determine whether this type of advertising is the best solution for your business needs.

Frequently Asked Questions

How do I advertise an OTT platform?

There are different ways to do it. e.g., During a cricket match or a movie, product integration. However, video and audio advertisements are the most popular advertising choices on OTT platforms in India. The Media Options and Prices area lists all available monetization options on OTT platforms.

Is OTT good for advertising?

Unlike traditional TV broadcasting, OTT services can cater to a select group of consumers. In addition, your advertising dollars will go further if you advertise on an OTT platform than with conventional advertising methods because it is more focused and targeted.

How do OTT platforms make money?

These advertisements, in turn, pay for OTT. Overall, the company's approach is quite basic. First, the platform spends money to produce or purchase its material, and then the material is sold by charging an access fee from the audience or consumers.

How is OTT advertising measured?

The Click-Through Rate (CTR) is a statistic that measures the success of your OTT advertisements. The click-through rate, often abbreviated as CTR, is the proportion of people who click on a link from an ad and visit your website. You may calculate CTR using the following formula: Clicks/impressions x 100 = CTR.



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