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OTT or Omnichannel?

For marketers and media watchers, the celebrated return of the HBO series Game of Thrones this past Sunday marked the supposed end of an era. Instead of marveling at the hoards of viewers, the somber tone of commentary around the event had to do with how the attraction of this many eyeballs during a season of programming (however abbreviated) will rarely be seen again. TV viewing is more fragmented, with streaming services enabling viewers to choose on what device and at what time they’d like to view their content. But good programming is still the key, because it affects who “tunes in” with streaming. A look at HBO Now subscribers around previous GoT seasons demonstrates that effect.

These tentpole properties are dear to broadcasters who want to make sure that fragmentation of the landscape through streaming doesn’t mean diffusing their revenue stream. Extending their local audiences through an ad tech platform like ZypMedia is another way.

“One of the challenges in this shift to OTT is all the dollars moving from broadcasters,” ZypMedia co-founder and CEO Aman Sareen told me recently. “We can help prevent leakage.”

ZypMedia expanded its leadership, hiring Charel MacIntosh as SVP of over-the-top (OTT) Channel Strategy and Sales. In over two decades, MacIntosh’s experience goes back to Westwood One and iHeartMedia (formerly Clear Channel). She also has OTT experience at Premion, the OTT ad solution for TEGNA. The goal for her is to “work with existing broadcast partners, and help with their adoption of selling omnichannel for local advertisers.” She added, “The value of OTT is through reporting and audience insights. Dayparts are becoming irrelevant because viewers stream [TV content] when they stream it.”

Even though the writing is on the wall, “it’s a huge job educating broadcasters on how to deal with the demand for on-demand viewing,” Sareen said. One problem is that the workflow in media is still divided between broadcast, now “video” teams, and separate digital teams.

On the consumer side, OTT is popular because it’s cheaper than cable and flexible. A new survey by The Harris Poll, on behalf of ZypMedia, identified “cord-cutters” and more diverse “cord shavers.” Thirty percent of adults are cord-cutters – they used to watch cable or satellite TV, but now they only use streaming. Even more, 37 percent, do both – these are the “cord shavers.” What do they both have in common? About half of each group don’t mind watching TV commercials. And for those who are receptive to ads, about half consider the ads they watch on OTT to be more relevant than the commercials they watch on cable. Younger viewers – Millennials – have more of a preference for local ads, on average, than consumers in the 55+ age group.

From a marketer’s perspective, the data and measurability provided by OTT, especially through local ads, makes it a potentially seamless link in an omnichannel connection with consumers across all of their devices. For a national chain, for instance, a brand can raise awareness on a consumer’s mobile device, and then follow up with an ad placement through a broadcaster’s local OTT app.

I spoke with Andre Swanston, CEO of Tru Optik, which provides solutions for open transactions between buyers and sellers across OTT. His impression from last week’s National Association of Broadcasters (NAB) Show confirmed his vision for OTT’s rise. “This being my fourth NAB, Connected TV and OTT played such a bigger part,” Swanston stated. “I feel like it drove the agenda. From the related tech hardware components, content delivery networks, agency and data sessions…it dominated NAB this year. It’s just indicative of where the industry is going. What else is there to talk about?”

He added, “The point is to reach the right households with relevant messaging. Advertisers are paying premium to advertise on CTV because it makes a premium impact, either better targeted or more efficient.”

Swanston also noted that the fastest growing segment percentage-wise by those who use Tru Optik is streaming audio. “There’s massive growth in people streaming local radio, podcasts, in the car or listening in the kitchen on Amazon Echo,” he said. “Because it’s not on traditional radio, it runs into the same problem with CTV…they don’t have their data mapped, coming from all the non-cookie-based devices.”

Swanston sees his company’s solutions as acting as the “connective tissue” between these various channels, on buy and sell side. The omnichannel perspective is being adopted by a leaders in OTT. (Tru Optik closed a $10 million venture round this month, and estimates the overall OTT industry as growing to $20 billion in the U.S. alone by 2020.)

As with Publicis’s acquisition of Epsilon, major players in the advertising and media industries crave data to ensure that they maintain their edge. This month’s announced partnership between Tru Optik and TransUnion makes OTT more data-driven and connected at the consumer level.

“When we dug in on the company, as they did on us, I saw the onus, how important privacy was to them. We hadn’t seen the same prioritization on privacy that TransUnioni had,” Swanston said.

Being sensitive to privacy concerns and agnostic about old lines drawn between broadcast TV and digital video will help marketers deliver a more relevant, sustainable experience to all media consumers in the future.

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