afaqs! news bureau

What will it take for the OTT space to truly challenge television?

At the recently held vdonxt asia Week, we discussed if the OTT space had caught advertisers' eye and can it go on to challenge TV.

The broad amount of money spent on advertising on television was Rs 30,000 crore in 2021 and around Rs 8,000 crore on OTTs. Around 900 million watch TV every month and 40 per cent of it watch content on OTT. People spend four hours a day on TV and spend one to one and a half hours on OTT platforms.

A recent report by the Singapore-based Media Partners Asia reveals that about Rs 8,250 crore of OTT’s topline of Rs 14,000 crore in 2021, came from advertising. Subscription revenue made up the rest, Rs 5,750 crore.

The OTT space is growing without a speed bump in sight. Now, what will it take for it to truly challenge television is the million-dollar question asked at one of the sessions from the recently held vdonxt asia Week presented by Voot.

Moderating the session was Sreekant Khandekar, co-founder and CEO, afaqs!. His panellists were Vanita Keswani, CEO, Madison Media Sigma; Mohit Joshi, CEO, Havas Media Group; Kartik Sharma, CEO, Omnicon Media Group; Harsh Deep Chhabra, senior vice president, Mindshare.

What will it take for OTT to truly challenge television?

Keswani: The first thing that comes to the minds of all advertisers and media planners is efficiency and how do you measure it? There are no integrated measurement systems. Even if you look at CPMs (Cost per mile or thousand), television is one-fourth for a Hindi speaking belt while the South is very cheap. The way most planners end up using it are those isolatable markets on digital which are non-isolatable on television so that’s the piece that is currently striking more for the OTT space. For example Delhi, Bombay… all the key cities where digital penetration is very high and you cannot isolate it on television.

OTTs need to be cost-effective. Even at current numbers, it is not. There is no third-party verification and if a comp score speaks of an OTT at X million, the actual OTT player talks anywhere 3X so what is to be believed?

Joshi: The kind of spends going behind OTTs are not that significant. We, in India, don’t look at audio-visual planning in an integrated manner; people see television and digital separately and OTT is somewhere in the middle. Today, we are trying to integrate it with TV. In my view, TV + OTT + OLV is what we should be looking at from an integrated audio-visual planning level.

But, the problem is there is no integrated measurement so how do you go to the client? We have our tools and we show our reach but the client wants third-party measurement. This does not allow us to use OTTs fairly. When you look at CPM, the bottom denominator is so big, no matter what you do, television will always come across as cost-effective.

Sharma: OTTs are not challenged by television as much as it is challenged by other video players (YouTube, Facebook) in the market who have scale. This along with cost-effectiveness and measurement is one side of the piece. We simply think all GRPs (Gross Rating Point) are equal; one TV GRP, one YouTube GRP, one impression whichever metric you want to look at… We’ve done a lot of work where we clearly see they are not the same.

The attention consumers are giving to various platforms is very different. Every single new media/medium goes through a phase where few support it, there will be one inflection point, and there is massive growth. The question is: When is that inflection point coming? I feel it has already happened.

Chhabra: I’ll build on the absolute scale of OTTs and more so in the context of women audiences where OTTs tend to be skewed more towards male audiences as compared to some of the other mediums. I’d like to highlight the way of working of some of the OTT players and how networks are approaching it and it is something they can fix pretty quickly because they don’t seem to be coming up with one consolidated solution which is TV + video.

When we talk of traditional broadcasters, they seem to be working in silos even within their own ways of working and I think that is one quick unlock if they choose to address it.

For the entire session, please watch the video:

Nepa India

Nepa India is a consumer science firm that helps some of the most reputable brands in more than 50 countries to unlock growth and profitability across all main areas impacting their customer relationship: marketing optimisation, innovation and customer experience.

It is headquartered in Stockholm, Sweden. Nepa is creating unconventional solutions in digital research for its clients in emerging categories in India. Keeping the focus on the fast-evolving content ecosystem, Nepa has supported major OTT players, production houses and media majors to tell incredible stories, develop impactful content and optimise viewer experience.

Nepa works with qualitative, quantitative and other new-age tech domains to understand the consumers. And, it is creating research literature for emerging categories like OTT and consumer tech, and also emerging cohorts across established industries.

Backed by its strong culture consulting expertise, Nepa's core purpose is to make research marketing friendly and redefine the way consumer science is perceived.

Nepa is known for its straightforward, no-nonsense consumer insight approach to nurture and grow its client's brands. It also creates thought-provoking and powerful thought leadership content through its marquee properties, Originals & Espresso.

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