OTT and Linear TV: Determining Optimal Video Strategy
Ever since the beginning of the pandemic, Simulmedia has been monitoring viewership trends across linear TV and OTT, as well as changes in viewing by genre, target audiences, networks, and dayparts.
First, it’s important to understand that there is more to OTT than meets the eye. Here’s research from Effectv’s recent “OTT and its place in the TV ecosystem” report that explains the categories of streaming:
- At least 39% of all streaming is not ad-supported (based on Amazon and Netflix streaming only—the actual amount that is not ad-supported would be higher if Disney+ and Hulu's ad-free versions had been included).
- More time is spent viewing through traditional step-top boxes than viewing through connected devices, even in households that subscribe to Netflix, Hulu or Amazon, which are subscription video on demand (SVOD) services. This is true across all age groups.
- What this means: “SVOD services are more likely to be supplemental
than a replacement to cable subscriptions.”
- OTT is growing, but it’s important to keep its relative usage in perspective. “The average adult spends over 5 hours every day watching video content across multiple screens and devices. The majority of that time (75%) is still spent with live/time-shifted TV.
Now let’s look at the scale of linear TV, in particular, data-driven linear. “Data driven” linear TV is characterized as adding a layer of data to TV so that advertisers can go beyond age-gender targeting to include more precise attributes, such as mobile app and website usage, and so they can precisely
measure the relationship between ad exposure and business outcomes.
- There are approximately 115M households (HHs) that receive the
internet, which is required to watch AVOD.
- Based on data from JP Morgan Chase and other sources, we estimate
that there are 58M AVOD HHs.
This whitepaper will explain the ideal approach to budgeting across two major sources of premium video inventory: data-driven linear TV and streaming, also known as over-the-top (OTT). In particular we will focus on the portion of OTT that advertisers can actually buy, called ad-supported video on demand (AVOD). It will explain what makes these two options the best ones for brands. We’ll also reveal why these two are not equal in opportunity.
We’ll provide a handy rule of thumb to help you budget for accounts for their respective audience reach and impression availability. Finally, we’ll share how Experian (a Simulmedia client) and Camelot, their agency, think about balancing linear TV and streaming in their media plans.
Table of Contents
- The Truth About OTT and Linear TV’s Available Scale
- Linear TV’s Available Impressions vs AVOD
- Optimal Budgeting, Linear TV and AVOD: A Rule of Thumb
- How Top Advertisers are Thinking About The Pros and Cons of Streaming
- The Benefits of Working with Simulmedia