VOD Advertising vs. TV Ads: Key Takeaways for Marketers

VOD advertising vs. Traditional TV ads

TV or VOD: where to advertise? While traditional TV still has an important role, a new wave of advertising methods has been threatening conventional TV ads these past years. One that stands out is VOD advertising. According to Statista, the worldwide revenue generated by VOD is expected to grow from $159.4 billion in 2023 to $230.9 billion in 2027.

As a result, companies have started to realise how profitable VOD advertising can be, and they are capitalising it. Unlike traditional TV ads, VOD advertising allows marketers to target consumers based on demographics, interests, and behaviours. This way, they ensure they transmit the right message to the right audience.

In this blog, we will discuss the main benefits of VOD and TV advertising, and which one to use depending on your company.

VOD Advertising: Benefits and drawbacks

1. Targeted advertising

Video on Demand (VOD) advertising refers to the practice of delivering advertisements within on-demand video content, allowing viewers to watch programs at their convenience. This model offers several advantages:

• Targeted Advertising: VOD platforms often provide advanced targeting options based on user preferences, demographics, and viewing habits, enabling advertisers to reach specific audiences more effectively.
• Flexible Scheduling: Advertisers can choose when and where their ads appear, offering greater control over campaign timing and placement.
• Interactive Features: Some VOD platforms allow for interactive ads, engaging viewers and encouraging direct responses or actions.

However, there are also challenges associated with VOD advertising:

• Ad Skipping: Many VOD platforms offer options to skip ads, potentially reducing the effectiveness of the advertisement.
• Ad Saturation: With the increasing number of advertisers on VOD platforms, there’s a risk of ad fatigue among viewers.
• Measurement Complexities: While digital platforms provide detailed analytics, interpreting data across various devices and platforms can be complex.

2. Major providers

In the UK, several renowned broadcasters offer numerous opportunities for VOD advertising. Platforms such as ITV Hub, Channel 4’s All4, Channel 5’s My5, UKTV Play, and Sky On Demand provide reliable infrastructure for accessing a wide range of audiences. By collaborating with these established broadcasters, businesses may use the reputation and reach of well-knwon channels to improve their campaigns.

3. High production costs

VOD is not the most cost-effective method of digital advertising available today, as it often costs more per thousand viewers than linear TV. They require a solid storyline, appropriate equipment, and expert editing. Then they must be shared across several platforms. This makes running a successful VOD campaign especially tough.

4. Too Internet reliant

VOD platforms rely greatly on steady internet connections. A snag in your Wi-Fi can cause buffering issues or even stop streaming completely. This dependency makes it difficult for consumers with unstable or sluggish internet connections to properly use these services.

A good example of VOD advertising would be Oatly’s “THE NEW NORM&ALSHOW”. Telling the story of puppet characters switching to a plant-based diet, the ad was successfully distributed across digital platforms such as Sky, All4, ITV Hub, YouTube, Facebook, and Instagram.

Traditional TV Advertising: Benefits and drawbacks

Traditional TV advertising involves placing commercials during scheduled programming on broadcast or cable television. This method has been a cornerstone of advertising for decades, offering benefits such as:

• Mass Reach: TV ads can reach a broad audience, making them ideal for brand awareness campaigns.
• Credibility: Being featured on established TV networks can lend credibility to a brand.
• High Engagement: Well-crafted TV commercials can capture viewers’ attention and evoke emotional responses.

Nonetheless, traditional TV advertising has its drawbacks:

• High Costs: Producing and airing TV commercials can be expensive, especially during prime-time slots.
• Limited Targeting: TV ads are generally broadcast to all viewers, lacking the precise targeting capabilities of digital platforms.
• Declining Viewership: With the rise of streaming services, traditional TV viewership has been on the decline, particularly among younger demographics.

1. Effective in reach and exposure

One of the most significant advantages of TV advertising is its unrivaled reach and visibility. Television has millions of viewers gloablly, making it a perfect platform for organisations looking to showcase their products or services to a large audience.

Unlike other platforms of advertising (i.e., radio, newspaper, etc.), TV ads appear during prime-time shows and special events, providing maximum exposure. In addition, TV commercials might target regional or national audiences, depending on the company’s adavertising budget.

2. Enhanced brand image

TV advertising allow firms to develop interesting storytelling and visually appealing content that contributes to a strong brand image. Companies may use fascinating storytelling approaches to evoke emotions, engage viewers, and leave a lasting impression.

In addition, the authority and credibility associated with television commercials make them an excellent tool for portraying a company as trustworthy and legitimate. Unlike digital ads, which may be quickly skipped or ignored, TV commercials require attention, strengthening brand identification over time.

3. Difficult to target your audience

TV ads just cannot compete with web advertising in terms of precision targeting. You choose a station and airtime on TV, but you can target people online based on their hobbies, age, location, and other factors.

While television has improved its ability to reach certain groups, it still cannot personalise ads based on individual habits, as digital platforms can. This lack of accuracy can make TV commercials appear less relevant, potentially leading to lower conversion rates than highly targeted web campaigns.

4. Innacurate ROI measurement

TV advertising ROI is more difficult to calculate than VOD advertising. Unlike online media, which can analyse clicks and engagement in real time, TV uses third-party analytics and polls to determine impact. While technologies exist for measuring audience reach, they frequently provide broad estimations rather than accurate statistics. Moreover, attributing direct conversions to a TV ad is difficult because rapid interactions cannot be tracked in the same way that digital ads can. This makes it difficult to determine how well a TV ad performs in comparison to its internet counterparts.

A good, recent example of TV advertising would be John Lewis’ 2024 Christmas ad. Appearing in every major TV channel in the UK, it emphasised festive shopping and family relationships, with the goal of evoking nostalgia and emotions.

Choosing between VOD advertising and Traditional TV advertising

Both VOD and traditional TV advertising offer advantages, making them appropriate for various marketing objectives.

VOD advertising is ideal for firms that want precise audience targeting and quantifiable outcomes. E-commerce firms, niche products, and data-driven marketers can all benefit from its capacity to target specific demographics via platforms such as ITV Hub and All4. However, high production costs and dependency on the internet are potential downsides.

Traditional television advertising is suitable for firms seeking widespread exposure and brand authority. Large firms and consumer goods companies can use television’s broad reach during prime-time hours to gain long-term recognition. However, its lack of precision targeting and difficulty in quantifying ROI make it unsuitable for performance-driven marketing.

Finally, the decision is based on your marketing objectives. Traditional television remains a storng challenger for broad reach and brand credibility. But if you want precise targeting and measurable outcomes, VOD advertising is a more modern and data-driven option. Businesses with the necessary budget and skill may even succeed in combining the two for a well-rounded plan.

Comparative Analysis: VOD vs. Traditional TV Ads

Making the Right Choice for Your Brand:

The decision between VOD and traditional TV advertising depends on various factors, including your target audience, budget, and campaign objectives. Consider the following:

• Target Audience: If you’re aiming to reach a younger, tech-savvy demographic, VOD platforms may offer more effective targeting options.

• Budget: For brands with limited advertising budgets, VOD advertising can provide cost-effective solutions with flexible pricing models.

• Campaign Goals: If your goal is to build broad brand awareness, traditional TV advertising’s mass reach might be beneficial.

• Engagement Strategies: For campaigns requiring interactive elements or direct viewer responses, VOD platforms offer more opportunities for engagement.

In many cases, a hybrid approach that combines both VOD and traditional TV advertising can maximiSe reach and effectiveness. By leveraging the strengths of each platform, brands can create comprehensive advertising strategies that resonate with diverse audiences.

Both VOD and traditional TV advertising have their unique advantages and challenges. Understanding these differences allows marketers to make informed decisions that align with their brand’s objectives and target audience. As the media landscape continues to evolve, staying adaptable and open to new advertising methods will be key to maintaining a competitive edge.

Contact Impress Video now

Interested in VOD advertising? Or perhaps TV ad production? Either way, don’t worry, we got you! At Impress Video, our professional team specialised in both VOD and TV advertising production will guide you through every step of the way, provind you with everything you need. This way, you’ll just have to focus on your business while we take care of everything else. Don’t hesitate to contact us here!