Guest Column: OTT segment and its future and the changing face of marketing: Manav Sethi, Chief Marketing Officer at ALTBalaji
Sometime in the future we would know which half of the money spent on advertising is wasted, feels Sethi
Published - 19-April-2017
Global and Indian consumers, consumption, and the market for entertainment are going through a change. This change is more structural than cyclical in nature. This change is empowering. This change is latent and personal when it comes to entertainment. It’s not “prime time” only and it’s certainly not India’s prime time, it’s rather MY TIME; MY PLACE and MY VIEW, on MY DEVICE!
I am choosing not to delve into market size and market share discussions at present. Let’s also park the debate whether Indian consumers are ready to pay or not. History has taught us entrepreneurs and marketers that a consumer pays if he sees value in what you are selling. Steve Ballmer in 2007 said for Apple phones: “There's no chance that the iPhone is going to get any significant market share. No chance.” He also said: “it doesn't appeal to business customers because it doesn't have a keyboard, which makes it not a very good email machine.”
Now, consumers and market forces will decide OTT’s future. But IT’s TIME HAS COME!
Also let’s agree on the fact that TV IS NOT DEAD in near term…settled!
Let’s look at catalysts to this structural shift. India has made a giant leap in adoption of mobile phones (according to TRAI, active mobile connections in India up by 19M in December 2016) and we are the only country on this planet which has highest m-o-m sales growth of smartphones. Prices of these are declining and capabilities of display, battery and processing is increasing with every release…camera included in that list (for selfies!). This device adoption was accentuated by pipe-push created by telcos which provided bandwidth and consistent bandwidth (try doing a decent voice call on few networks and metros). Then came big daddy of all- RelianceJIO that believes in “bandwidth is like tasting blood- more you wanna resist more you have”. It surely created significant consumer shift in providing “throughput” rather than consistent bandwidth above, without worrying about its own CAC (customer acquisition cost), Debt & P&L. In fact, come to think of it, JIO made other players also do it.
Now the stage is set. From images to articles to humongous video consumption everything is on these mobile devices. Ubiquity of exchange of this content (sharing) was created by pervasiveness of Whatsapp in India. And hence the business models that weren’t possible earlier are seemingly possible now, entertainment included!
Video currently accounts for 60% of mobile data traffic, according to the KPMG India-FICCI report, and mobile video traffic is estimated to grow at a compounded annual growth rate of 63% between 2016 and 2021. It will be much more than 63% is my belief! If telcos enable it, don’t be surprised to witness 100% CAGR!!
Platforms bring with them structural shifts in forces at play around them. Same is expected to happen with the rise of OTT platforms. Holy Grail of TV viewership and ratings which is based on small sample of households would give way to exacting views and viewers to the extent of how many watched till how many seconds of video! And possibly what all they did after that. It would also solve addressability and attribution gaps that TV struggles to even attempt. BARC Ekam is a step in this direction but it’s just the tip of the iceberg. These platforms would individually churn out lot of near real time data and actionable insights that has been a marketer’s dream until now. The standards of “viewability” and creating a common currency to be used by entire ecosystem will be the challenge. This would also enable “dynamic ad insertions” and evolution of programmatic ecosystem.
It would also create efficiency in creative process by allowing multiple options to be placed for diverse viewers across- ethnicity, location, day-part and socio-economic containers for better ROAS and ROI goals with A/B testing for each creative. Marketers would be able to build nexus with post campaign actions/goals which in today’s world is a meaningless attempt. If Netflix made 10 different cuts of the trailer for House of Cards, each geared toward different a audience, so can a brand in the near future!
I have a kid of 7 years and she grew up on “peppa pig” on Youtube and consumes “Netflix” today. Brands and marketers would be able to reach TG such as hers (Generation Z) with creatives meant for her and viewed only by her.
These platforms will have and will enable DIRECT RELATIONSHIP WITH CONSUMERS!
Am I going out on a limb to say that sometime in future we would know which half of the money spent on advertising is wasted?
(The author is Chief Marketing Officer at ALTBalaji)
Disclaimer: The views expressed here are solely those of the author and do not in any way represent the views of exchange4media.com.For more updates, subscribe to exchange4media's WhatsApp Channel- https://bit.ly/2QUdLCK