What Is OTT Advertising? How Streaming TV Ads Work

OTT advertising is video advertising inside TV and video content streamed over the internet, rather than delivered by cable, broadcast or satellite. "OTT" stands for over the top: the content goes over the top of traditional TV distribution. The ads play in breaks inside streaming services and apps, on TV screens and other devices, and can be targeted by place, content and audience. This explainer is part of our paid advertising guide.

It covers how an OTT ad reaches the screen, how campaigns are bought and targeted, what the creative needs, and what you can and can't measure.

What counts as OTT

The industry body IAB defines OTT as video, live or on demand, delivered directly to viewers over the internet, bypassing cable, broadcast and satellite. It covers every device, from phones and computers to games consoles and TVs. Connected TV, or CTV, is the part of OTT watched on a television screen. We untangle the terms in OTT vs CTV vs streaming TV.

Not every streaming service carries ads in the same way. These are the main models IAB describes:

How an OTT ad reaches the screen

Ads on streaming TV usually play in ad pods: groups of ads that run back to back, like a commercial break. Each position in the pod is a slot. When a break comes up, the service asks an ad server or exchange to fill the slots.

Many services then use server-side ad insertion (SSAI). The ads are stitched into the video stream on the server before it reaches the viewer, so the break plays as one smooth stream. IAB describes this as eliminating buffering between content and ads.

The ad itself is usually described in VAST, the IAB Tech Lab's Video Ad Serving Template. VAST is a standard XML format that tells a video player which file to play, and where to report impressions and progress. Since VAST 4, it also supports a mezzanine file meant for server-side ad insertion.

How OTT ads are bought

There are three common routes:

• Programmatic. Ads are bought by software in real-time auctions or private deals. OpenRTB 2.6, the main standard for these auctions, added support for ad pods in CTV, so a buyer can bid on one or more slots in a break.
• Direct. An advertiser or agency agrees a deal with a streaming service or its sales team, usually for set placements or audiences.
• Self-serve platforms. Some streaming services and ad platforms let advertisers set up campaigns themselves, with targeting and budget controls.

Whichever route you use, ask where the ads will actually run. A buy described as OTT may include phones and computers as well as TVs. If the big screen matters to you, ask for the share of impressions served to connected TVs and the list of apps or channels. In OpenRTB, connected TV is its own device type, so a partner can report it separately.

Programmatic buying brings a fraud risk that's specific to apps. IAB Tech Lab's app-ads.txt standard lets app publishers, including CTV apps, publish which sellers are authorized to sell their ad space. Ask any partner how they check it.

How OTT ads are targeted

Because streaming runs over the internet, OTT can be targeted more finely than broadcast TV. Common options include:

• Geography. Down to regions, cities or ZIP codes, usually based on the household's internet connection. A local business can reach its service area without buying an entire broadcast market.
• Content. Genre, programme type or specific apps and channels.
• Audience. Data-based segments, depending on the platform and its data partners.
• Your own audiences. With some partners, households linked to a geofenced audience or to visitors to your website.

We cover that pairing in more detail in pairing geofencing with streaming TV.

Creative for streaming TV

A streaming TV ad plays on the biggest screen in the house, in the same breaks as national brands' commercials. It needs to hold up there: clear sound, a readable frame, and a message that works without a click.

Specs matter as much as quality. OpenRTB 2.6 lets a seller list the exact durations it will accept, which it notes is for live TV, where a spot of the wrong length would leave dead air. So deliver the lengths each buy asks for, and plan cutdowns from the start. When we produce streaming spots, we plan a :15 and a :30 from the same shoot, plus vertical and square versions for the phone side of a campaign.

What you can measure

OTT reports start with delivery: impressions, completion rate and, on some platforms, reach and frequency across households. Those numbers tell you the ad played. They don't tell you what it did.

To see results, connect the campaign to what happens next: visits to your website from households that saw the ad, branded searches, calls and form fills, and sales. Attribution is never perfect, because people often see a TV ad and act days later on another device. Compare results during the campaign with a period or area without it.

We cover measurement step by step in how to measure CTV ad performance.

If you'd rather have the spot made and the campaign run under one roof, our in-house ads team produces streaming TV creative and runs OTT campaigns.