OTT ads influence spending for 35% of video viewers in SE Asia, Japan

More people are watching video via an app or website that offers streaming video content and bypasses traditional distribution. They include YouTube/YouTube Red, Netflix, HBO Now, Hulu, Amazon Video and SlingTV.

26, Mar. 2021

A key finding in a SpotX study in Thailand, Singapore, Vietnam, Indonesia, the Philippines, Japan and Australia found that OTT ads drive strong post-ad purchase behavior for 35 percent of OTT viewers. (NNA)
A key finding in a SpotX study in Thailand, Singapore, Vietnam, Indonesia, the Philippines, Japan and Australia found that OTT ads drive strong post-ad purchase behavior for 35 percent of OTT viewers. (NNA)

By Nigel Kwan

Results-driven marketing is at the forefront of advertising as recessionary pressures tighten budgets.

OTT (over-the-top media service) has hit the mainstream and been embraced by a broader demographic during the pandemic, offering advertisers a compelling combination of audience scale and market-leading levels of cost per completed view (CPCV), conversion rates (CVRs), and viewability.

However, these metrics will become table stakes in 2021 as advertisers demand more tangible proof of effectiveness.

OTT campaigns drive meaningful top-of-the-funnel awareness and consideration, as SpotX’s latest OTT brand lift studies in Southeast Asia have shown. But that’s not to say OTT cannot deliver on bottom-of-the-funnel activation objectives as well.

A key finding in SpotX’s “OTT Is for Everyone” research — conducted across five Southeast Asian countries (Thailand, Singapore, Vietnam, Indonesia, and the Philippines) along with Japan and Australia — found that OTT ads drive strong post-ad purchase behavior for 35 percent of OTT viewers.

COVID-19 has unleashed a new wave of digital shoppers, accelerating the existing e-commerce boom.

Regional platforms such as Singapore-based Shopee saw Indonesia sales boost beyond 120 percent in the first three months of 2020, according to the South China Morning Post.

Indonesian e-commerce platform Bukalapak witnessed an increase in ad spend from consumer lifestyle brands, while Unilever has started its own online platform, U-stores, to facilitate direct-to-consumer (D2C) transactions.

Bain & Company reported that over 70 percent of e-commerce transactions in APAC are conducted on mobile, compared to 40 percent in the US.

With the popularity of mobile-app-based OTT, brands are increasingly leveraging the platform to drive sales, especially if a purchase is just a click or swipe away.

Regionally, over one-third (35 percent) of ad-supported OTT viewers in APAC made a purchase after seeing an ad during programming they watched. That figure is even higher in Southeast Asia, as 45 percent of Singaporeans and 53 percent of Vietnamese viewers made a purchase online, in store, or by redeeming a voucher after seeing an ad.

As more consumers feel the pandemic-related fallout on the economy and job market, subscription fatigue will grow.

Now, 67 percent of OTT viewers in APAC prefer to watch free, ad-supported content versus 23 percent who prefer to pay for an ad-free service. Ad-supported video on demand (AVOD) will be the key driver of growth for OTT in the region and will become an important channel for brands looking to engage audiences who are willing to buy.

Good ads matter and it’s important to understand what users want from their ad experience.

Our research highlighted that product relevance, creativity, emotional impact, and a good storyline all make an ad effective, and APAC viewers were less likely to skip an ad if it was funny, shared feel-good positive content, and had likable music.

In markets with mobile-app-based OTT consumption, brands that have leveraged touchscreen-enabled interactive have achieved better ad outcomes.

For instance, SpotX Studio’s branded border end card for Grab Food Indonesia over Ramadan saw a 9-times higher click-through rate (CTR) compared to industry benchmarks. Additionally, having a seamless ad experience is key, as the majority of OTT viewers (68 percent) prefer ads to open within the app when clicked rather than in a separate browser.

The opportunity is here for advertisers to leverage OTT’s potential to drive purchases and e-commerce growth.

As Arianne Kader Ku, Country Head of Viu Philippines, puts it, “This year has been a game-changer for OTT with advertisers and agencies seeing the importance of being present on the platform. It is no longer an optional medium.”

*Nigel Kwan is vice president of marketing for SpotX, a video ad serving platform, across Southeast Asia, Japan, Australia and New Zealand. He is responsible for building the SpotX brand with leading demand and premium video supply partners in the fastest growing region in the world.