Streaming platforms have seen a big surge, along with the growth of subscription video on demand (SVOD). As subscriptions are skyrocketing, OTT becomes the mainstream way of consuming video content. Based on eMarketer forecasts, by 2020, viewers will spend over 50% (130 min per day) of their daily free time watching digital videos on OTT.

In the recent report by Digital TV Research, the global subscription growth predictions look optimistic. Based on these estimates, by 2025, SVOD will reach over 460M in APAC, 100M in LATAM, and about 30M in MENA. In the US, the number of subscribers will reach 317M. Also, there’s a curious forecast regarding Western Europe. Namely, out of 191M subscriptions expected by 2025, only 35M will join this year thanks to the lockdown.

The growing trend urges new OTT services to enter the market. In turn, it drives more viewers to take up a subscription. Along with more advanced TV platforms, the industry sees new ad services. Especially, specific CTV ad services such as Allroll or Roku native ad platform aimed to help publishers grow their OTT channels. As CTV keeps evolving, we’ll see more independent-channel promotion opportunities like these.

Increasing the number of services also encourages viewers to take multiple offerings simultaneously. For instance, in the UK, the proportion of users subscribed to at least 3 streaming services accounts for 14%. That number has grown by 4% since 2017 and keeps increasing.

In the US, where the number of available OTT services has increased by 140% in five years, consumers get a wide range of options to meet their video needs. Most consumers find it’s not enough for them to go with a single service. And this is where small and medium-sized services can fill in the viewer gaps by providing exclusive content.

Advertising on CTV: Why It Works And Is Accepted So Well

Something else that is growing apart from OTT subscribers is the number of people tolerating the CTV ads. For instance, 80% of US CTV viewers watch ad-supported content. The leading cause is the viewers’ behavior and the things they are getting used to while watching videos. To get insights into this, let’s take a closer look at the actual CTV audiences.

Thus, the core audience of US CTV viewers in 2020 is Gen Z representatives (45.7 million), millennials (56.5 million), and Gen X viewers (48.5 million). Most of them are cord-cutters and cord-nevers who have abandoned linear TV or have never consumed one.

By cutting cords, this hard-to-reach audience segment gets to their favorite video content collected all in one place — on the CTV screen. Hence, Gen Zers, Gen Xers, and millennials are open to consuming whatever goes alongside the content they are going for.

Another critical group of the CTV audience, which is still fewer than younger cohorts, is boomers. However, the adoption of streaming video among boomers is growing slowly and methodically. Compared with the same figures a year ago, boomer viewers increased by 8.3%, accounting for 32.8 million viewers. As viewers of this kind have been watching commercial breaks for years, they don’t feel any irritation seeing ads on CTV.

Challenges and Factors Nurturing OTT Ad Growth

While CTV advertising looks like fantastic exposure, it has its limitations, though. Advertisers who decide to leverage CTV need to get ready to face challenges like lack of standardization and ad buying nuances.

When it comes to CTV channel owners, one of their essential needs is accessing tools for promoting their content. In this regard, they can leverage Roku. This platform provides them with the most advanced promotion toolkit compared to its competitors.

However, Roku native promotion tools don’t let channel owners get the most of it. Specifically, with Roku, they are getting 60% fewer installs compared to what could be achieved with the same promotion budgets. A solution can come from marketing platforms, helping channel owners increase their audience and spend less.

However, these limitations don’t mean video content producers and advertisers should postpone CTV ad adoption. Alternatively, the reasons contributing to OTT expansion come from all flanks. The already mentioned speeding up of cord-cutting, cancellation of live sports events, and stay-at-home trends are just a few factors leading to increasing CTV video consumption and OTT subscriptions.

Other ingredients in this recipe are:

  • High viewability. Unlike the way they work on desktop or mobile, OTT ads mainly go full-screen. It means there are no controls to minimize or skip them. Therefore, this creates an advantage for advertisers who can reach a large screen and better engagement. Besides, advertising through OTT grants access to the living room, where families spend time together.
  • Consumer behavior shift. Viewers tend to explore the wide range of OTT services and experiment with multiple subscriptions. Their goal is to get a particular mix of content through various services.
  • Devices and viewership are growing in volume. The market for OTT devices keeps rising and evolving. Hence, it demonstrates more opportunities for publishers and advertisers. Indie content producers especially have their moment now. They can attract new audiences by investing in their OTT presence and producing more exclusive content and ad inventory.
  • Advanced targeting and data. OTT targeting empowers advertisers with the opportunity to set up their ads granularly. Advertisers can serve it to the viewers with specific demographic or lifestyle traits. Along with that, OTT provides more capabilities for data collection, processing, and measurement. Data on specific content viewed, time spent on it, and other parameters help enrich targeting settings.
  • Premium content. New streaming platforms come with plenty of premium content, fueling their consumption growth even more. Both great and small platforms bring tremendous content libraries to subscription OTT. At the same time, platforms like Apple TV+ and Roku pour money into original content, as well as opening the gates to small and medium-size content producers, encouraging them to present and promote their content in front of CTV audiences.
  • Large media companies start adopting data-driven TV ads. Seeing the value OTT brings to today’s media mix, large advertising companies start offering OTT-specific platforms for serving addressable ads.

What to Expect In 2021: Channel Owners’ and Advertisers’ Perspectives

As traditional pay-TV keeps losing its audience, this might be a great opportunity for streaming platforms and CTV content producers. To meet and greet new audiences, they have to offer viewers high-quality and engaging content.

Especially when it comes to young cord-cutters, it’s vital to deliver them a content viewing experience similar to what they are used to. Reality shows featuring celebrities, lifestyle shows, or documentary series are just a few ideas to start with. Content producers who can afford TV series and original movie production will have a CTV moment now, considering Hollywood has been on hiatus over the lockdown.

In turn, brands should pivot their advertising to the OTT environment, which is a breeding ground for them. Today, advertisers get a powerful collection of tools that don’t compare to what linear TV or even digital ads can provide. This includes creating ad-supported content with CTV channel owners and interactive, immersive, and shoppable programmatic ad formats.


OTT content consumption and advertising are rising. This provides both marketers and content creators with tremendous opportunities. What is essential for them now is to meet, and exceed, their viewers’ expectations by providing content of genuine quality and ads.

What about outcomes? We believe it won’t take too long until advertisers and content producers, who are ready to embrace OTT opportunities, achieve remarkable growth.

Image Credit: jeshootcom; pexels

Alex Zakrevsky

Alex Zakrevsky. COO at VlogBox, CTV/OTT app development, distribution, and monetization platform. Product lover, advanced TV enthusiast, see the future in quality and digital.