Thanks to companies like Netflix, OTT streaming has become the entertainment medium of the future — but it’s also a far more crowded space than it was a decade ago. Platforms like Hulu, Amazon Video, Disney+, and even HBO have entered the market, each competing for similar audiences. While OTT subscriber acquisition continues, cord cutting and the novelty of streaming are no longer the primary drivers.
So what trends can providers and marketers capitalize on to drive OTT market growth while engaging with customers? Today, we’ll explore three cases that warrant additional discussion: hardware, branded IP, and advertising.
For more information about OTT media services, check out Meghan’s full blog series starting with What Is OTT?
How devices drive OTT subscriber acquisition
Netflix and OTT subscription services may emphasize home viewing, but not everyone watches television shows on a television screen. Customers who stream content to mobile devices represent a growing market, and shouldn’t be ignored in favor of smart TVs and digital media players. In fact, these audiences often overlap — the same individual who watches Game of Thrones after work may also enjoy YouTube videos while riding the bus. OTT providers need to adjust their UA strategies accordingly.
According to one eMarketer report, over 75% of total worldwide video consumption occurs on mobile devices. This figure becomes more modest when focusing on OTT subscription platforms, but an impressive 20% of Netflix viewing still occurs on smartphones with 50% of customers logging in from mobile devices once a month. How customers access OTT platforms can also vary wildly depending on region — 60-70% of Finland’s subscriptions are viewed on cellular networks, while Mexico relies heavily on WiFi connections.
Even if we ignore viewing statistics, smartphones remain a crucial user channel for OTT subscriber acquisition. Netflix data states that 70% of customers view content from televisions, but only 5% use TVs to create an account. Instead, 30% of initial sign-ups occur on mobile devices, before most users transition to a larger screen.
As such, mobile advertising channels have rightfully become a major focus for OTT brands. At Tapjoy, we’ve seen platforms experiment with all kinds of UA tactics, from straight CPI campaigns to free trial subscriptions. The most successful campaigns ultimately drive users down the funnel, which is most effective via apps and mobile web than other avenues.
How IP drives OTT subscriber acquisition
When choosing which OTT services to subscribe to, customers often give major consideration to the original and exclusive content they offer. OTT brands make so secret of their affiliation with franchises like Game of Thrones and Orange Is The New Black, often dubbing them “original series” wherever applicable, making them effective rhetorical devices for marketing subscriptions. As streaming becomes more common, providers have pivoted to emphasize their most popular original IP:
- Netflix: This streaming pioneer has a head-start in terms of unique IP, thanks to an impressive collection of TV series, films, documentaries, stand-up comedy specials, and more.
- Hulu and Amazon Prime: Both providers are furiously developing engaging content and moving beyond initial hits with a diverse streaming library.
- Disney+: In November, Disney’s streaming platform will be positioned to pull licensed content from other providers, making it the only place to watch Marvel and Star Wars content.
- HBO Now: While not strictly a standalone OTT service, HBO Now has become a major streaming competitor by pairing hits like Game of Thrones with HBO’s back catalogue (The Sopranos, Sex and the City).
- Apple, Google, Facebook, and Sony: Major tech brands are attempting or have attempted to enter the OTT market with mixed success. Apple and Facebook are relatively new arrivals who could still make a mark with original content.
In 2019, OTT brands can attract new subscribers by offering exclusive and engaging serial content. In some cases, marketing occurs by word of mouth — as you’ve noticed if water cooler talk revolves around Game of Thrones. But OTT marketing campaigns themselves can attract users by swapping generic brand messaging for IP-focused creative. At Tapjoy, we frequently see upticks in clicks and conversions based around major IP releases. The caveat is that marketers must regularly switch up creative to ensure their IP line-up doesn’t appear stale.
How in-app advertising drives subscriber acquisition
Sometimes, OTT subscriber acquisition is all about practical considerations — most notably, that cord cutters aren’t watching live TV any longer. That means the best way to advertise new OTT services is through digital and mobile channels.
In 2019, the most important digital channel is in-app advertising. As I mentioned in a previous article, three factors maximize conversions and engagement through an in-app environment:
- Almost half of the population owns at least one smartphone.
- Mobile advertising is at least 30 times more effective than traditional advertising channels.
- Smartphone users spend roughly 90% of their smartphone browsing time in mobile apps.
OTT providers, aware of the channel’s immense potential, have turned to in-app advertising to market subscriptions and encourage cross-promotions. Meanwhile social media apps provide an excellent top of funnel opportunity by providing a platform for subscribers to comment on content they’re excited about. Beyond the inherent UA benefits, in-app advertising also lets OTT providers buy new subscribers on a performance basis, cutting down on media waste. It offers lower funnel tracking as well, helping providers measure LTV far more accurately than standard TV ratings.
OTT streaming is here to stay, but no one platform is an undisputed champion. From Netflix to Amazon Prime, each service has unique benefits that attract – and retain – loyal subscribers. Now that streaming technology is no longer novel, in-app advertising and IP-based marketing are essential strategies to ensure your OTT platform thrives. To find out how Tapjoy can address all of your advertising and subscriber growth needs, contact our expert team today!