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HomeNewsAd-Supported Video-On-Demand: What is it and How Does it Work?

Ad-Supported Video-On-Demand: What is it and How Does it Work?

Advertising supported video-on-demand (AVOD), is making waves in the media industry, and for good reason.

The concept of AVOD is pretty simple and is something that audiences are excited about. AVOD offers audiences the opportunity to watch their favorite content without paying fees to the content or platform owner. Rather, the audience is subjected to viewing ads in exchange for “free” content.

These ads are strategically placed alongside the video content and may appear at the beginning, middle, or end of the program. They may even appear more than once during a video. Advertisers are introduced to an even wider target audience because these video content and ads are digitally delivered over the internet.

There has been growth in AVOD since 2021, and the growth doesn’t seem to be stopping anytime soon.

Which Platforms Support Ad-Supported Video-On-Demand?

When you consider our definition and consider the various streaming platforms that you know, the first one that would come to your mind is YouTube. However, there are many more AVOD platforms available.

Wherever videos are streamed— apps, websites, mobile phones, smart TVs, or videogame consoles—these platforms are available. These platforms are readily available everywhere to take full advantage of the different kinds of people who stream video content. In a nutshell, every person who consumes video content on any device or service is a potential customer.

It might seem like these services don’t have a lot to gain from them, but once you refine your content and understand the strategy to get to the viewers your audience will continually grow.

AVOD services need to attract audiences and hold their attention for as long as possible. This means that the platform needs to be easy to use, provide good content, and be easily accessible from as many devices as possible.

What is Video-On-Demand?

VOD is a content distribution method that gives viewers the power to choose where, when, and how they want to see video content. Before the advent of video-on-demand, viewers had to watch pre-scheduled programs on cable or local channels, but now, at the click of a button, anyone can watch any video at any time.

Of course, video-on-demand has some basic advantages with the features it possesses. The first of which is user control. Users can watch what they want at any time, and as many times as they want, in comparison to traditional TV scheduling. And since the pandemic and forced global lockdown, VOD platforms have become even more popular as people looked for non-stop entertainment.

Advertising Video-On-Demand vs. Subscription Video-On-Demand

There are many ways to deliver content to viewers, and popular streaming platforms like YouTube, Netflix, and Hulu seem to have their methods down to pat.

SVOD platforms work like traditional TV or cable services where viewers pay a monthly fee to access the content. Consumers have the option to opt-out of these services at any time, and platforms include ad-supported and non-ad-supported ones.

AVOD, on the other hand, is free to customers, and viewers are subjected to more advertisements on these platforms than SVOD. The ads on platforms like YouTube are more frequent, and most of them can’t be skipped.

AVOD services are typically cheaper than SVOD services.

OTT/CTV Advertising and AVOD

There’s no way to talk about AVOD without mentioning over-the-top advertising and connected TV advertising.

OTT is a term used to describe video content that is delivered via the internet without cable or satellite. To access any OTT content, viewers must have an internet-enabled device.

Connected TV, on the other hand, is smart TVs and other internet-enabled televisions that can access content via an internet connection.

Over-the-top and connected TV advertising platforms have a large amount of data to work with, and advertisers can use this data and information to strategize their ad budget and campaign. With proper targeting to the right engaged audience, there are higher chances of generating quality leads that would convert into clients who take action.

For marketers, it is best to borrow a few pointers from OTT/CTV advertising to optimize and drive leads.

Benefits of Using AVOD

AVOD is beneficial for advertisers in many ways, but here are just a few highlighted ones.

Variety of ad formats

Advertising in AVOD allows advertisers to take advantage of a myriad of ad formats which include pause ads, display banners, and sponsored content. The array of ads is beneficial to customers as the services are constantly looking for ways for users to enjoy their ad experiences.

Advertisers can take advantage of these user-friendly ad formats to provide ads that customers will actually view and enjoy.

Wide range of audiences

Since it’s a free model and is available on all kinds of devices, AVOD services are very attractive to all kinds of audiences. People enjoy free things, and although they would pay for content they love, they are also happy to enjoy the content they love for the small price of watching a few ads.

Available for hyper-targeting

Advertising-based video-on-demand leverages personalized data to deliver premium content to the right audience. Brands can use everything from geography to age, gender, and online habits. Unlike linear or cable TV advertising which came with its limits and was broadcast to a generic audience, advertising on AVOD services is better for hyper-targeting the ideal audience.

Brands have the opportunities to take advantage of several targeting scenarios including behavioral advertising, purchasing targeting, demographic targeting, and contextual targeting.

Change comes with the opportunity to adapt and grow positively. The global pandemic that forced people to stay at home and change their lifestyles caused a shift in the way people consumed video content. People leaned more towards AVOD services, and the trend has steadily grown since then.

The brands that will grow with the industry are the ones with marketers who can adjust accordingly to keep up with the rapid shifts.

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