Streaming TV Advertising: CTV, OTT, SVOD, AVOD, TVOD?

Streaming on TV has become a hot concept, with more people ditching cable TV and moving towards streaming services. It is a relatively easy concept that offers one of the most effective ways of advertising in 2021.

According to Businesswire, the global streaming market has grown from $104.11 billion in 2019 to $161.37 billion in 2020 at an astonishing compound annual growth rate (CAGR) of 55.0%. The exponential growth is mainly due to the lockdown owing to the COVID-19 outbreak during which the subscription to various streaming channels and viewership has increased. The market is then expected to stabilize and reach $169.4 billion in 2023 at a CAGR of 14.0% from 2021.

In this article, we provide basic industry terms that you will hear in relation to CTV and streaming services and what they mean.

CTV/OTT what is the difference?

Generally speaking, both abbreviations are typically used interchangeably. The reason is CTV & OTT are directly related to two similar but very different concepts.

Connected TV (CTV):

Connected TV or CTV is any television that is connected to the internet and where users can stream content directly from the internet. Smart TVs that are connected to the internet or TVs that are connected to gaming consoles and other devices that enable streaming are called CTVs.

CTV examples:

● “Smart TVs” that stream video directly over the internet● Internet-connected devices like: Roku, Chromecast, Fire stick, Apple TV and others that stream to a TV ● Game consoles such as XBox, Playstation, Nintendo, and others that stream to a TV

Over the Top (OTT)

OTT is a streaming resource providing content to viewers through the internet. OTT is just a different channel through which video content can be delivered to the final users. OTT content can be viewed on different devices, including computers, mobile devices, CTV devices, and more.
Services such as Netflix, Amazon Prime, Hulu, and others are known as OTT.

SVOD, AVOD & TVOD 

These terms define Streaming TV services by their revenue models and how audiences can access their respective content.
VOD’s meaning is “video on demand”. This is a pretty literal definition, meaning that these videos will be online and accessible at the viewer’s convenience. SVOD, TVOD and AVOD are VOD variants conceived out of the need to make the service profitable. Thus, the distinction between the different flavors is based on how the service generates revenue.

Subscription Video On Demand (SVOD):

SVOD is a video monetization strategy based on recurring revenue, usually monthly or annual subscriptions.
Services such as Netflix, Disney+, and Amazon Prime are known as Streaming Video on Demand (SVOD) services. These services offer ad-free streaming services and provide a collection of original and licensed content.

Advertising-based video on demand (AVOD):

AVOD is when services stream video content for free, but require viewers to watch ads.
Services such as Hulu and Peacock that offer lower-tier subscription models in exchange for showing ads to the viewers are known as Ad-Supported Video on Demand.

Transactional video on demand (TVOD)

TVOD is when users can choose to pay for individual videos, rather than subscribing to access the entire video library.
Services such as Google Play and iTunes are designed for larger audiences who may not be consistent since there’s no fee to join, anyone can buy your content.

To sum up

Advertising is shifting towards a hyper-personalized approach, in which there is no room for monotonous and universal commercials. The era of personalization and transparency has already arrived. These two aspects can lead to higher ROI for advertisers and channel owners.
CTV is an additional feature that helps to expand audiences, reach those people who are sometimes unavailable through the other channels and monetize.

UBIDEX Programmatic Platform as a Service helps clients to run CTV campaigns, analyze and optimize them in real-time to receive better performance and higher incomes.