What is the Best OTT Platform For Your Business?

OTT, or over-the-top, platforms are those that stream video content directly to viewers via the internet. As such, this type of video streaming service provides marketers with opportunities to advertise their products and services to viewers directly to their viewing devices. 

The benefits of OTT advertising are bountiful: targeted advertising, advanced analytics, and dynamic ad insertion that allows you to interact with your audience in a variety of ways. 

When connecting with modern audiences, OTT platforms are the way to do it. But which OTT platform provider is the most effective for your business? Read on to learn more about the best OTT platforms for advertising and marketing. 

What is an OTT Platform?

Relaxing to your favorite Netflix show on a smart TV, watching a podcast on your phone’s Spotify app, or watching a New York Times newsreel on your laptop?

All of these actions have one thing in common—over-the-top platforms.

Over-the-top, or OTT, describes any content streamed directly from the internet (as in, not through broadcast radio, network TV, or cable). Over the past few years, streaming audiences have grown quickly, making OTT platforms some of the most fertile advertising territories on the market.

While all OTT platforms operate over an internet connection, there are two distinct types of OTT platforms that affect how marketers can advertise to viewers: pricing models and content source models.

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Pricing Models

All OTT content is accessed one way—via the internet, but not all OTT platforms permit access the same way. To open their content to customers, all streaming services choose one of three pricing models:

• Subscription (SVOD for video) – Some OTT platforms adopt subscription plans, where users pay a (typically higher) fee to access content without advertisements. Streaming services like Netflix, Amazon Prime, and Disney Plus use this model. Unfortunately for marketers, it blocks any advertising possibilities.
• Ad-based (AVOD for video) – To replace subscription fees, other OTT platforms run completely on advertisements. This model includes streaming services like Tubi TV, Pluto TV, Sling TV, Xumo, and Sony Crackle. Depending on the platform, these can be excellent options for advertisers.  
• Hybrid – As a blend of subscription plans and ad-based platforms, hybrid models offer both subscription and ad-supported options to their customers. For example, Hulu offers viewers a lower-cost subscription with ads or a higher-cost subscription without ads. Similarly, Spotify offers free accounts with ads or premium subscriptions for an ad-free experience.

Since subscription-only models have no commercials, marketers can only use ad-based or hybrid OTT platforms to reach their target audience. 

Content Source

Another way to differentiate an OTT streaming platform is by the origin of their content. While some streaming services create some of their own content (such as Netflix and Hulu), others primarily rely on non-original content (Fubo and Pluto TV) from TV networks.

Most OTT platforms fit into these three sourcing categories:  

• Native – Streaming services that create exclusive content are considered native OTT platforms. For example, Netflix, Hulu, Amazon Prime, and HBO Max are native services because they produce original shows that viewers can only access on their platform.
• TV Publisher – When watching live TV, you have access to numerous channels and networks like the Discovery Channel, CBS, and the Cartoon Network. However, these networks also provide streaming apps where viewers can watch their televised content from a streaming device, such as a laptop or smartphone. These types of OTT platforms are called TV publishers.
• Linear Streaming – Linear streaming is quite similar to classic TV programming: Viewers can watch live TV programs slated to air during specific times over the internet, rather than watching via broadcast or cable. OTT platforms like Sling, Pluto TV, and Fubo rely on linear streaming. 

Many OTT platforms mix their sourcing. For example, Peacock TV (NBCUniversal’s streaming platform) blends original programming, re-published NBC shows, and live news. 

Knowing a platform’s content source can help you decide if it’s the right advertising space for you.

Top OTT Platforms for Businesses

Over the past few years, OTT platforms have quickly grown in terms of viewership—and show no signs of stopping. In 2019, the global OTT industry was valued at $121.61 billion, with projections to reach $1.039 trillion by 2027.¹ 

For businesses, it’s a guaranteed hot-spot for consumer interest.

Take a look at our breakdown of the best OTT platforms for advertising businesses to determine which platform will be most beneficial to your advertising campaign and marketing strategy.

#1 Spotify

As the world’s leading audio streaming service, Spotify provides millions of listeners with their favorite music, podcasts, and videos. It’s particularly useful to businesses looking to target a global audience with niche interests.

• Content – Spotify primarily provides audio content through music and podcasts. Although, it also provides creator-made video podcasts for those looking for an audible and visual experience. Many of the podcasts are native content, meaning that they’re produced and exclusively shared on Spotify. However, most content on the platform is secondary, meaning that it’s created and uploaded from a secondary source, such as a podcast producer or music artist. 
• Pricing model – Spotify has a hybrid pricing model. Listeners who choose to use a free membership will have to listen to frequent ads throughout their listening experience. However, listeners who purchase a premium membership for $9.99 a month will have an ad-free experience.
• Users – From 2017 to 2020, Spotify grew its total monthly users from 173 million to 356 million.² Within that number, there are 198 million unsubscribed users with ad-supported listening, making it a great platform for marketers to spread the word about their products or services.
• Audience demographics – Spotify’s membership demographic is global and youthful with listeners in over 178 global markets³ and over 55% of users under 35 years old.⁴ 

#2 The Roku Channel

Roku began as a CTV device, connecting TVs to online streaming services. However, in 2017 it also started its own OTT platform—The Roku Channel. After combining its device with a platform, Roku became the most popular Advertising Video on Demand (AVOD) streaming service in the United States.

• Content – The Roku Channel offers a mix of secondary and original video content on its platform. However, most of its original content was purchased from Quibi, a failed mobile-only OTT platform.⁵  
• Pricing model – The Roku Channel is entirely an AVOD (ad-based) model. However, the Roku device does connect viewers to ad-free subscriptions of other OTT platforms, like Netflix. 
• Users – At the start of 2021, The Roku Channel had nearly 70 million viewers,⁶ a clear growth from 23.8 million in 2018.⁷ 
• Audience demographics – Roku’s audience is relatively even-spread, with a median viewer age of 39.⁸ Currently, only viewers in the U.S., Canada, and the United Kingdom can watch its content.⁹ Additionally, 64% of Roku Channel viewers don’t watch other AVOD platforms, making it their exclusive source for streamed ads.¹⁰ 

#3 Hulu

Launched in 2008, Hulu is one of the oldest (and now most popular) OTT video streaming platforms. Between its millions of subscribers and steady growth, it’s a valuable advertising option to marketers and businesses.

• Content – Hulu offers a mix of original, secondary, and live video content. It’s primarily known for showing recent TV programs, usually releasing them 1-2 days after their broadcast or cable premiere. 
• Pricing model – Hulu has a hybrid pricing model with multiple subscription tiers. The lowest option ($5.99/month) includes pre-recorded content with ads, while the highest option ($70.99/month) includes all live and pre-recorded content with zero ads.
• Users – As of 2021, Hulu has 41.6 million subscribers,¹¹ with about 60% viewing content through an ad-supported subscription.¹²
• Audience demographics – Overall, Hulu’s audience is primarily suburban/rural, white, and lower-income.¹³ Additionally, Hulu is only available in the U.S. and Japan. 

#4 Peacock TV

Peacock TV is a recent addition to the OTT market. The NBCUniversal-owned platform is a promising service for advertisers looking for growing audiences and ad-supported content. 

• Content – Peacock TV blends original, secondary (or re-published), and live video content. Most of its secondary content originates from the NBC channel and Comcast.
• Pricing model – Currently, Peacock has a hybrid pricing model with three tiers. The first tier allows viewers to watch limited content for free with an ad experience. Viewers also have the option to pay $4.99/month for exclusive content with ads. Or, viewers can pay $9.99/month for an ad-free experience and access to all content on the platform. 
• Users – Since July 2021, Peacock TV has 54 million total viewers and 10 million paying subscribers.¹⁴ However, just 4% of users subscribe to the ad-free premium tier.¹⁵ 
• Audience demographics – Peacock TV’s audiences are more suburban and liberal than most video streamers.¹³ Age and income level are quite evenly distributed among viewers.

#5 Tubi

A unique platform, Tubi is one of the most popular linear streaming services in the U.S., and its ad-supported model and young audience make it a viable choice for businesses.

• Content – As a linear streaming platform, Tubi only streams “live” streaming or scheduled programming on channels similar to those on broadcast TV. Its library includes more than 20,000 films and TV shows from 250 different content partners.¹⁶ 
• Pricing model – Tubi is 100% ad-supported, with no ad-free option.
• Users – In January 2021, Tubi had 33 million active users per month.¹⁷
• Audience demographics – Unlike its counterpart, broadcast TV, Tubi has a youthful and diverse audience. Half of its viewers are under 35 years old, and 39% of its audience is Black, Hispanic, or Asian.¹⁸ 

Create Your OTT Power Plan with PDM

OTT platforms aren’t just a trendy hot spot for advertisers—they’re the billboard of the future. As current streaming services grow and new ones emerge, picking the right OTT platform is vital when marketing your business efficiently and effectively.

Need help breaking into the world of OTT platforms? Powder Digital Marketing has the intensive research and professional experience to help you create a customized plan for your business’s success. Our digital marketing services provide the solutions you’ve been looking for.

Sources: 

1. Allied Market Research. Over-the-top (OTT) Market Outlook – 2027. https://www.alliedmarketresearch.com/over-the-top-services-market
2. Porter, J. Spotify premium subscriber count increases 21 percent to 158 million  https://www.theverge.com/2021/4/28/22405953/spotify-earnings-q1-2021-subscribers-average-revenue-per-user
3. Spotify. Company Info. https://newsroom.spotify.com/company-info/
4. Iqbal, M. Spotify Revenue and Usage Statistics (2021). https://www.businessofapps.com/data/spotify-statistics/
5. Perez, S. Roku will launch original programming fueled by Quibi’s content on May 20. https://techcrunch.com/2021/05/13/roku-launches-an-original-programming-lineup-fueled-by-quibis-content/
6. Mensun, B. Roku sparks big Q1 revenue spike despite user growth slowdown. https://www.fiercevideo.com/video/roku-sparks-big-q1-revenue-growth-despite-user-growth-slowdown
7. What to Watch. Roku subscribers and earnings. https://www.whattowatch.com/news/rokus-earnings
8. Frankel, D. Roku’s NewFront Pitch: Why Target 60+ When You Can Reach Under 40? https://www.nexttv.com/news/rokus-newfront-pitch-why-target-60-when-you-can-reach-under-40
9. Roku. What are Premium Subscriptions on The Roku® Channel? https://support.roku.com/article/360016436834
10. Roku. 3 Highlights from Roku’s Presentation at  Newfronts 2021. https://advertising.roku.com/blog/news-events/roku-newfronts-2021-presentation
11. Walborn, D. Hulu Improves to 41.6 Million Total Subscribers, Hulu Live TV Loses 200,000. https://thestreamable.com/news/hulu-q1-2021
12. Kotuby, J. Hulu Continues to See Most Customers Choose Ad-Supported Plan. https://thestreamable.com/news/hulu-continues-to-see-most-customers-choose-ad-supported-plan
13. Shevenock, S. Paramount+ Is Entering a Crowded Streaming Market. What Will Make Consumers Subscribe? https://morningconsult.com/2021/03/01/paramount-plus-streaming-subscriber-demographics/
14. Rizzo, L. Inside Comcast’s Plan to Become a Streaming Giant. https://www.wsj.com/articles/comcasts-ceo-built-a-cable-giant-can-he-build-a-streaming-giant-11624473722
15. Kotuby, J. Could NBCUniversal and WarnerMedia Team Up Against Disney+? https://thestreamable.com/news/could-nbcuniversal-and-warnermedia-team-up-to-take-down-disney
16. Perez, S. Tubi TV Grabs $6 Million From MGM, Lionsgate And Others For Its Free, Ad-Supported Streaming Service. https://techcrunch.com/2015/11/19/tubi-tv-grabs-6-million-from-mgm-lionsgate-and-others-for-its-free-ad-supported-streaming-service/
17. Gruenwedel, E. AVOD on the FAST Track: Free Services Are Changing the Streaming Landscape. https://www.mediaplaynews.com/avod-on-the-fast-track/
18. Hayes, D. Tubi Says Streaming Rose 58% In 2020, With Half Of Viewers Younger Than 35. https://deadline.com/2021/01/tubi-streaming-rose-58-percent-2020-viewers-under-35-1234676400/

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