Ad fatigue: boring, cheap promos turn OTT users off
New Delhi, Dec. 10 -- Advertising on video-streaming services is increasingly resulting in viewer fatigue as platforms try to replace plateauing paid subscription revenue with ad money. Users are bombarded with long and unskippable ads, often with glitches, that make viewing experience tedious and disrupt the flow of a show.
Experts said if advertising is to grab mindshare, the poor ad experiences must be dealt with urgently. However, rectifying the matter will be challenging.
For one, OTTs use CPM, or cost per mille (cost per thousand) as the basis of advertising. It is a pricing model where advertisers pay for every 1,000 impressions, or the number of times ads are shown. The rates for digital/OTT are very low in India as advertisers don't see a wide audience base. Competing online platforms like social media or e-commerce are considered more viable.
"A big challenge OTT platforms face with ads is extremely low CPM in India. This happens due to an oversupply of ad inventory and a relatively smaller number of advertisers," said Ujjwal Mahajan, co-founder of Chaupal, a platform specialising in Punjabi, Haryanvi and Bhojpuri content.
As a result, ad rates for OTTs are more than 90% lower than for those in regions like North America. The disparity creates a major issue for OTTs-they don't want to sell ads at low rates, which limits the number of advertisers who meet their requirements. Consequently, viewers end up seeing same ads repeatedly, leading to ad fatigue and a poorer viewing experience, Mahajan said.
Rajat Agrawal, director and COO of Ultra Media & Entertainment Group, agreed OTT ads in India are lengthy-of 2-3 minutes each-and repetitive. Ads don't match user interests, making the viewing experience feel like a never-ending ad marathon. With limited opt -out options and intrusive ad formats, frustration is building up among subscribers.
"The fragmented OTT landscape, with multiple platforms and ad models, is definitely adding to the confusion. Many services use AVoD (advertising-based video-on-demand) models to draw in crowds but often aren't transparent about their ad policies and sometimes even premium content gets interrupted with ads," he added.
AVoD is a streaming business model that allows users to access video content for free if they watch advertisements.
Experts said such issues can be resolved only when the advertising revenue or CPM rates rising enough to attract a sufficient number of publishers and advertisers to fill ad slots more effectively and at shorter intervals. The other way is to take up direct selling, as it is done in television, but that requires establishing sales teams. Until that happens, this challenge is likely to persist in the Indian market.
Companies with TV arms such as Jio, Zee and Sony usually bundle TV and OTT deals-there isn't much direct buying and selling for OTT alone. Netflix doesn't have ads.
Only Amazon miniTV, which is entirely free, does ad deals, benefitting from the broader Amazon ecosystem. Amazon has been clear in saying the idea is to target consumers across all its verticals-shopping, video and tech. On Prime Video, the duration of ad breaks is shorter, and the ads are better or newer than those on other local platforms.
"Most Indian users still choose ad-supported plans, so platforms prioritize revenue over refining the ad experience. The tech stack is still evolving, too. Inconsistent device quality, patchy internet connectivity, and immature ad-delivery systems make frequency capping and personalisation harder to implement," said Priyank Dattani, associate creative director at digital agency White Rivers Media....
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