Posted on May 17, 2011
A little under two years ago, Inside Digital Media predicted that sponsors would ultimately demand they only pay for video ads that actually get watched. (Thinking the Unthinkable About Video Ads – September 18, 2009). We reasoned the success of the cost-per-action pricing of Google AdWords would force change. Since sponsors only pay Google when viewers “click on” AdWords text, they would ultimately apply such a cost-per-action standard to banner and video ads as well.
Last week a YouTube executive provided confirmation at WPP Group’s Global Video Summit. WPP Group is a leading advertising and media management company. YouTube’s Product Manager for Video Monetization, Baljeet Singh, was a Summit guest where he forecast half of video ads by 2015 would be cost-per-view. He explained how it is starting on the Internet.
YouTube is offering “TrueView Video Ads” permitting viewers to choose the ads they want to watch. There are two options. In one, after the ad plays for five seconds, viewers get a choice to skip or watch the ad. The advertiser is not charged unless the viewer lets the ad play to completion, or for at least thirty seconds. A second option gives viewers a choice of ads to watch during regular commercial breaks. Sponsors are only charged when their ad is selected. Read more…
Posted on March 24, 2011
During the past dozen years the percentage of American households with DVRs increased from zero to forty percent. Viewers became increasingly accustomed to skipping commercials and viewing shows on their own timetables as opposed to broadcast schedules. The growth intensifies apprehension among sponsors that TV advertising is losing effectiveness. While to date industry efforts to combat the trend have been unproductive, recent developments suggest the tendency can be mitigated, and even reversed. When combined with better ad targeting and commercials permitting viewers to segue into spontaneous online merchandise purchases, the TV industry could advance to a new era of prosperity.
The “trick” is to transform scripted shows into realtime events. As the chief executive of CBS noted last month, “Every major (live) event over the last year – Academy Awards, Grammy’s, etcetera – did exceedingly better than the previous year.” While live performances such as athletic contests and awards ceremonies are classic examples of events, it’s increasingly feasible to convert scripted programs into realtime shared experiences as well. The key is to involve audience members in silent chatter over social networks as they watch the TV shows at scheduled broadcast times. The two most important of such networks are Facebook and Twitter. Although viewers may actually be alone, they get a sense of congregating in the living room, watching the show together. Read more…
Posted on February 3, 2011
There may appear to be no connection between Time-Warner boss Jeff Bewkes and the Sesquicentennial of the American Civil War, but they’re linked by false confidence in the status quo. Every time the press quotes Time-Warner’s “Content is King” mantra I am reminded of the failed Confederacy’s “King Cotton” diplomacy.
After 150 years we laugh at “King Cotton”, but the argument seemed plausible at the time. When the war began cotton accounted for 60% of United States exports. The American South represented 70% of the World’s production. Furthermore, shipments were almost certain to increase for years because cotton was rapidly becoming the essential fabric for garments in the civilized world.
Initially the Confederate government attempted to induce European recognition with a voluntary cotton embargo. Later the Union blockade cut exports even more sharply. Consequently cotton production increased in India, Egypt, and Argentina. As the South’s best customers turned to other suppliers, it was forced to trade with the enemy. New England textile mills sent agents south into Federal-controlled war zones to acquire – by whatever means – all the cotton they could get. Read more…
Posted on September 27, 2010
Second, sponsors will refuse to pay for video ads and TV commercials that don’t get watched.
Third, ad hoc WiFi networks will provide cellular bypass and become crucial advertising properties for local merchants.
Most experts mistakenly believe consumers will want Internet access on their TVs mainly to choose among popular movies and TV shows. That’s what Apple surveys conclude and traditional media executives find it convenient to agree. However, such results ignore that the vast majority of survey respondents haven’t experienced unrestricted Internet TV access. Therefore they do not yet fully appreciate what other activities and programs might interest them. Read more…
Posted on September 13, 2010
GroupOn’s breath-taking success implies a Manifest Destiny reminiscent of the early dot-com era. It will not only change the way local businesses use the Net to get new customers and sales, but it will likely forever change video advertising.
The company made two crucial discoveries about meeting client needs that previously eluded others addressing their market. Furthermore, they’re currently discovering how to fulfill the promise for two types of Internet advertising that to date failed to live up to potential.
First, GroupOn enables clients to rapidly generate new sales and customers via the Internet. Read more…
Posted on August 19, 2010
In earlier posts and podcasts we discussed the theoretical advantages of behaviorally targeted advertising and how the Internet is best suited for the technique. Today we interview Bryan Burdick who is the Corporate Development Officer at Bizo.com which is a company that actually implements behavioral targeting via the Internet.
He also describes how the data is kept anonymous so as to protect individual privacy. We learn that offline marketers, such as Acxiom, actually have far more personal information about us than Bizo will ever collect via cookies. Read more…
Posted on August 6, 2010
Most film producers and other companies associated with conventional television fear the Internet. They don’t see how they can profit from it. Instead they worry it will erode revenues from conventional sources, replacing them with lower amounts. To date their concerns are well founded.
For example, few Internet users will pay a subscription fee for shows already on television. Moreover, the Internet provides no “carriage fees” like those paid by satellite and CATV operators to the networks — and indirectly the producers. While movie downloads admittedly provide revenues from sales and rentals, they are at least partly at the expense of DVD rentals and sales. Finally, online advertising revenues at video streaming sites like Hulu and YouTube are pathetically small by comparison to those available from conventional television. Much like the record labels, it’s likely that the Hollywood studios and television show producers wish that the Internet had never been invented. Read more…
Posted on May 31, 2010
Prompted by the recent GoogleTV announcement, last week Bloomberg-BusinessWeek reported that the product concept would revolutionize advertising in two ways. First, it would lead to a new policy whereby sponsors only pay for ads that get watched. Second, it would enable video ads to be better targeted.
However, regular Inside Digital Media subscribers recognize that we’ve been chanting this mantra since last July’s Future Developments in Video Advertising research report. Another example is our Thinking the Unthinkable about Video Ads last September. Read more…