OTT space shaping up to be very valuable for marketers in APAC
The OTT space is shaping up to be very valuable for marketers to capture new, targeted audiences and provide another avenue for them to increase brand engagement, says Rishi Bedi, the vice-president for South East Asia, Japan and Korea at InMobi.
Nine out of 10 viewers use their smartphones to stream videos
Over-the-top (OTT) video has been one of the predominant forms of visual entertainment among consumers since the 2000s, with frontrunners such as Netflix leading the way. Then came the Covid-19 pandemic at the end of 2019, which caused the popularity of OTT video to skyrocket even further – especially in Asia Pacific (APAC).
With APAC travel and entertainment sectors on prolonged pause due to some of the world’s strictest and longest lockdowns, consumers in the region began spending more time online to fill the void, leading to an unprecedented interest in streaming video. As of March this year, OTT viewership was estimated at over 400 million people across APAC, with more than 69% watching videos at least once a week.
Brands and marketers are taking note of this shift in favor of OTT video platforms among APAC consumers – not just because higher viewership equals wider reach, but also because consumers have indicated they are more willing to pay for or accept an ad-based model on OTT video platforms. This presents significant opportunities for brands to leverage the popularity of OTT video to drive awareness and increase brand engagement via ads among a wider, more receptive audience.
The mobile factor
Smartphones are a key APAC growth driver because they unlock accessibility to digital services. To date, smartphone ownership in the region has crossed the billion mark and is expected to triple by 2025. Governments are also recognizing the fundamental role of mobile connectivity in digital-centric strategies and eschewing investment in landlines and cable networks to focus on accelerating mobile infrastructure.
This is where the cross-screen accessibility of OTT video has been a game-changer. With smartphones now a necessity in the Covid-19 era and mobile internet connectivity more widespread than ever, mobile is by far the dominant device for APAC viewers to access OTT video content.
Nine out of 10 viewers use their smartphones to stream videos. Given the strong growth projections for smartphone penetration and infrastructure development in the region, it is fair to predict that OTT video may see a parallel increase as more people start coming online via their mobiles.
OTT preferences among APAC consumers
Accessibility aside, our 2021 The OTT Premium Video Wave report, which covers consumers from India, Singapore, the Philippines and Australia, also found that viewers simply preferred OTT video platforms and content. When comparing OTT videos to long-form videos, short-form videos and cable TV/DTH connections, an average of 46% of consumers demonstrated a clear preference for watching videos on OTT platforms over other options.
Some 40% of respondents across all markets found OTT video content the most immersive and engaging, with 51% believing that OTT video platforms were ‘complete value for money.’ Additionally, not only did respondents rank OTT video among their top two types of video content to watch and discuss with friends and family, but they were also unanimous in being least willing to give up OTT video platforms out of the four video options. This underscores their strong attachment to OTT video and highlights how much of a fixture it has become in everyday entertainment.
Marketing via programmatic on OTT
Marketers can ill afford to ignore its strategic importance and impact as a marketing channel.
APAC consumers have a higher tolerance for ad-based models as a ‘freemium’ alternative to paid subscriptions, and our respondents indicated they would still use OTT video platforms even if they were completely ad-based. This is good news for marketers as OTT ads can leverage many mobile-first signals such as location, demographics and technographic to identify the target audience and enable ad personalization, leading to increased consumer engagement and more effective brand ad spend.
At least 60% of our respondents found that ads on OTT video platforms were relevant, and four out of the five surveyed markets placed OTT video platforms among their top three for most engaging and/or interesting ads. However, there is still room for improvement; less than 30% found the ads ‘very relevant’ and OTT failed to place among India’s top three for engaging/interesting ad platforms.
However, marketers need to stay constantly updated on metrics and technologies that can build more comprehensive customer profiles for more accurate targeting and ad personalization. The best practice for running ads on OTT video platforms is to figure out the right video ad serving template (VAST) technology, which defines how ads appear to users. Additionally, getting the video duration right is also crucial: 15-30 seconds tends to be the sweet spot.
An eye on the OTT-driven future
What is most exciting about the OTT video in APAC is that it is still a very nascent space. The 400 million current users of OTT streaming services comprise less than 10% of the region’s total of 4.3 billion people, and with more users coming online, there is still huge growth potential.
The OTT space is shaping up to be very valuable for marketers to capture new, targeted audiences and provide another avenue for them to increase brand engagement. Marketers that can effectively capture the preferences of OTT audiences and the nuances of OTT video advertising will have an important advantage – especially during a time where brands are striving to remain top-of-mind in the increasingly fierce competition for brand recognition and loyalty among consumers.
Rishi Bedi is the vice-president for South East Asia, Japan and Korea at InMobi.