Finecast’s Alexandra Lowes looks at how OTT and CTV markets are accelerating exponentially in APAC and the many options that advertisers have to access streaming opportunities across the region.
The pandemic accelerated the growth of OTT and CTV in APAC and globally as streaming content transpired into a habit while people were confined within the four walls of their homes. The ecosystem has witnessed such tremendous growth that every three months, the landscape changes through emerging technology, players, platforms and devices. And as their loyalty towards streaming content increases, OTT and CTV investment is poised for growth.
Recent data gathered from GroupM’s “This Year Next Year” research found that OTT Investment in APAC is expected to grow from US$4.3 billion to US$7.2 billion between 2020 and 2026, which is approximately a 67% increase in six years.
The region runs on a hyper-local approach that plays to the nuances of individual markets. Depending on the country and the growth of tech, this heavily depends on the stages of automation, device penetration into each market and the kind of content each audience absorbs. It is also prominent that the maturity of the market varies across consumers and how fast businesses are able to make their inventory addressable.
APAC has the largest and fastest growing SVoD subscription base in the world and is expected to grow over 40% of the global SVoD base. Some of the local players include Tencent, iQIYI and Viu. Despite having the largest subscription base, APAC generates only 20% of SVoD global subscription revenue and below are some points to note based on recent research from Ampere Analysis:
- The region is seeing a rise in the consumption of video and content streaming through various channels.
- Smartphones are essential for communication and video consumption in countries such as India and Indonesia but traditional DVR devices are preferred to smart TVs and OTT boxes in Japan.
- In Malaysia, smartphones are popular but the usage of desktops is also growing exponentially.
- India is set to become the third largest TV market globally by 2026.
Development of OTT, CTV through omnichannel strategy
Even though data suggests that the shift towards OTT and CTV viewing has now appealed to a younger demographic in some markets, it hits a broad audience overall. Adopting an omnichannel approach is crucial for advertisers to reach and engage with audiences across the spectrum with varied TV-viewing habits. Viewers have the option of multiple subscriptions across various devices, so weaving in contextual and behavioural data into media buying decisions is crucial for advertisers to ensure the campaign is targeting the desired audience.
While advertisers have always targeted ad effectiveness and viewability, they often ignore the correlation between ad quality and customer engagement. But it has become obvious in recent years that the lower the ad quality, the higher the chances of disengagement.
Viewers interact with their devices differently throughout the day, providing advertisers with the opportunity to leverage this by creating content to engage them more effectively through linear, on-demand and livestreaming. This is achieved by using addressable audience planning tools.
Post-pandemic effect on APAC’s OTT, CTV subscriptions?
Streamer subscriber growth is witnessing a dip across key global markets as economies are potentially headed towards a global recession. However, OTT growth opportunities in APAC will translate differently across all markets. The diverse range of cultures, income levels and languages present in APAC will be the challenge for OTT services but understanding the local presence and providing local offerings, pricing strategies and tailored content will be key differentiators.
The migration to streaming services during the pandemic has held steady as across the APAC markets, linear TV audiences continue to decline and reaching those audiences is becoming challenging and expensive. Research by Ampere also suggests that local content is driving engagement across multiple streaming platforms and among the top 15 commissioners in APAC, SVoD services from China, India and Japan have gained prominence.
Bundling SVoD services is also a big business for telcos across the region with its low cost and ease of access, which ensures that the subscription momentum keeps pace.
Understanding ad options on APAC’s streaming market
The TV marketplace and ecosystem is only increasing in complexity and fragmentation. Given the complex distribution and viewing environment, understanding the structure of the TV marketplace and being able to differentiate between different types of content providers, viewing environments and formats is becoming increasingly challenging. Advertisers have a plethora of options to access streaming opportunities across the region, which can make it challenging for them to isolate the right opportunities for both their brands and audiences.
Turning complex situations into simplified solutions for advertisers is at the heart of what we do – aggregating as many addressable TV supply sources as possible into one to activate against is core to our business. This would include OTT, set top box and addressable linear sources.
At the heart of our business is our proprietary cloud-based audience planning tool – Finecast Audience Planner. It has the world’s largest source of data for TV planning, allowing advanced segmentation against geo-locations which activate against all our inventory partners.
Adding to this, what is compelling for our industry is the growing intersections between commerce, creativity and data across the addressable landscape. The opportunities that advertisers now have access to, across one of the best mediums to build brands, is powerful.
What lies ahead
It is undeniable that OTT and CTV markets are accelerating exponentially in APAC, especially as the region witnesses the growth of high-speed data and increased smartphone usage. When it comes to the competitive world of digital video and streaming, identifying the best strategies such as tapping into cutting edge technology, addressability, flexibility and aggregation to facilitate maximum reach and customer engagement is crucial.
The growth of OTT and CTV is rooted in transparency and adopting the right kind of technology while partnering with the right publishers will only enhance this further.