OTT Devices Continue Their Ascent For Premium Digital Video Ad Views

January 3, 2019

Video advertisers have a wide variety of devices through which to reach consumers, but OTT devices have rocketed ahead in viewers’ use the past year, now taking by far the largest share of US premium video ad views. That’s one of the key findings from FreeWheel’s latest monetization report [download page] covering Q3 2018 activity.

In Q3 2018, 41% of premium video ad views occurred through an OTT device, a figure essentially matching that of desktop (16%), smartphone (19%) and tablet (7%) combined. The other significant device for ad views is through set-up box video-on-demand (STB VOD), which accounted for 17% of the premium video ad inventory being delivered.

Put together, OTT devices and STB VOD comprised 58% of premium ad views for the quarter, up from 49% a year earlier.

Last year’s data had OTT devices accounting for 29% of ad views, only marginally ahead of desktop (28%). STV VOD followed with 1 in 5 ads being delivered through these devices, with smartphone (15%) and tablet (8%) accounting for the rest.

As a whole, the number of video ad views are up by double-digit percentages. Viewers watched 18% more videos in Q3 2018 versus the same period in 2017, with ad views up by 26%.

This means that while OTT devices cemented their lead in terms of market share, total ad views are up on every type of device with the exception of desktop (-6%). Smartphone ad views have grown by 63% year-over-year, with OTT up by 45%, tablets by 12% and STB VOD by 11%.

Premium digital video viewers in the US are using OTT devices and STB VOD platforms for longer content typically associated with traditional TV viewing. 100% of ad views delivered to STB VOD devices were for full-episode viewing, while almost all ads featured on OTT devices were split between live content (48%) and full-episodes (49%). Only 3% of the ads on OTT devices were shown as viewers were watching short clips of 5 minutes or less.

By contrast, a third (33%) of ad views on desktop were delivered as consumers were watching clips. Despite their more portable nature, smartphones and tablets had a lower share of ads delivered through this more snackable content, comprising 19% and 12% of the ad views respectively.

Premium ad views are increasingly taking place on long formats. Ads that are shown while viewers watch clips now only account for 11% of the total composition, with the overall number of ad views on these shorter formats falling by 20% year-over-year.

This shift illustrates that advertisers are keen to reach consumers while they are in a passive, “lean back” mode, which separate research from Extreme Reach has shown leads to higher ad completion rates. The FreeWheel report backs this viewpoint up, with 98% of mid-roll ads being completed for live and full-episode viewing.

And while these ad buys are largely bought directly, accounting for 84% of the premium video ad spend, programmatic monetization has grown by 43% year-over-year.

The full report can be viewed here.

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