Mad.co.uk: Monetising video in competitive online environments
Irfon Watkins, CEO at online video company Coull and chairman of the IAB Video Council discusses how brands can monetise video in a competitive and social media driven environment.
If implemented and managed well, interactive marketing can be the most effective (and cost effective) way of not just raising brand awareness, but also resonating with your audience, creating brand loyalty and driving sales. Video is almost certainly a key area that social networks, publishers, brand owners and advertisers are looking to increase awareness. We are likely to see this trend steadily increase throughout the rest of 2008 and into 2009.
Forrester estimates that US online video advertising alone will be worth in excess of $7.1 billion USD by 2012 which represents a 72 per cent increase whilst interactive marketing as a whole (of which online video is a huge component) will more than triple to reach $61 billion by 2012. Forrester also predicts that budgets for interactive marketing will grow from 8 per cent of all ad spend to a very significant 18 per cent. It’s safe to assume that similar growth will be replicated here in the UK.
Moreover, as online video grows in popularity among consumers, advertisers are also seeking new and creative ways to reach this key audience in a non-intrusive, fully interactive manner. New rich media ad formats continue to be developed that are integrated within a streaming video, do not interrupt the viewing experience and match to the most relevant content in non-intrusive ways.
As consumers flocked to user generated content (UGC) sites such as YouTube and MetaCafe, the most obvious conclusion was to place “pre-roll” in the videos – and this seemed to offer a solution for UGC sites who were struggling to return a profit to their investors. Now, “pre-roll blindness” is hot on the agenda where users are ‘seeing’ the advertisements, but they are not ‘seeing’ them, certainly not connecting with them on a deeper level. Pre-roll is often seen as disruptive and intrusive and the challenge for both publishers and advertisers is creating compelling videos to communicate that will be on-brand.
We are seeing traditional production companies snapping up the rights to online video content, such as ShineReveille recently taking on MySpaceTV content to distribute to traditional media outlets such as television and DVD; the reverse being broadcasters such as The BBC and Channel 4 distributing their content through platforms like Bebo and YouTube.
Brands are producing more videos, hosting these in UGC sites predominantly and employing a seeding strategy to increase pick-up, interactivity and longevity of the content. Video represents more opportunities to communicate marketing messages in creative ways; so we are begin to see this realised on a scale that has taken many by surprise. We are starting to experience video come into its own finally, although it is still somewhat finding its feet in some quarters.
Social networking sites are monetising their video content through contextual advertising, sponsorship and placement – all of which are passive rather than interactive. As with all things ‘Web2.0’ a proposition, be it a video, a text ad and/or a widget, needs to be ‘value-adding’ in order to capture imagination and more importantly, retain interest, follow through a call to action and invite recipients to share it with others
Video (until now) has not been particularly interactive, though companies like Coull offer publishers, social networks, agencies and brands the ability to create something special in using video in order to maximise their potential. New platforms and ad formats have enabled the fusion of consumer created advertising and non-intrusive content with active participation by viewers. This creates one of the most compelling and comprehensive models in the online advertising industry.
Bebo’s success of Kate Modern (which since it launched in August 2007 has received over 27 million views) is now followed by Sofia’s Diary where key brands are sponsoring the series and paving new ways to connect with users. Brand engagement and monetising opportunities can also be reinforced and married to traditional advertising sales. Product sponsorship can be married to online video advertising placements that are non-intrusive and reinforce the value of the product.
Consumer-inspired commercial opportunities are a real opportunity to capture monetising opportunities. Online video opportunities allow users to interact with the brand in a more interesting way, access more information about that product and emotionally connect with brands. Perhaps the ‘Rolls Royce’ of them all is when your target audience becomes your brand ambassador and takes the time out to create an ode to your brand, product and or service - whether this is a mash-up (a video re-mix) or original content.
When brands embrace ‘consumer power’, involving them in successful ads that are driven by the evolution of video and this translated well in digital environments; you can see how the medium holds the potential to inspire others to capture similar interest.
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