Archive for the ‘Events–commentary’ category

Mashable: What YouTube Needs to Do Now to Turn Things Around

August 8, 2008

This week I took part in a panel with fellow Internet video execs at the RBC Conference. Everyone on the panel was in agreement that brand advertisers want to sponsor “safe content”–professionally produced content that runs on reputable sites. Having said that, I don’t think that is YouTube’s only solution–there are other monetization models currently in the market such as display ads and overlay ads that can be priced on a CPA (performance) basis that could be used to monetize UGC. There may also be other monetization models not yet developed that may be used to cash in on YouTube’s massive volume of UGC inventory. At the end of the day, although the content is primarily UGC, it represents a significant volume of traffic and (as Blinkx CEO Suranga Chandratillake pointed out during our panel discussion, but not quoted in the article below), more than anyone, Google can afford to lose a little money on YouTube as it figures this out. After all, Google didn’t monetize search through advertising AT ALL during its first few years, but they ultimately figured out how to do that pretty well.

What YouTube Needs to Do Now to Turn Things Around 

YouTube hasn’t been able to monetize videos of eighty-year old men mooning a crowd of onlookers? It hasn’t been able to monetize someone lip-syncing “I Kissed A Girl?” Who would have thought that?

At a recent meeting of Internet videoSelling-Entertainment-Online Jan-08 executives at the RBC Capital conference, the panelists told those in attendance that user-generated content simply doesn’t provide any real monetization value and Google needs to find new ways to turn things around if it wants to turn a profit.

Later on, the execs said that the key to Google’s success has nothing to do with user-generated content and everything to with professional content, which can be controlled, analyzed, and properly determined to appeal to the key demographics advertisers are looking for.

“What we’ve found is that advertisers and agencies are only interested in professional media, so professional content providers are having a good time finding extremely high demand because they have a lack of video views,” Blinkx CEO Suranga Chandratillake said.

And for once, we’ve finally heard what YouTubeYouTube ‘s business model should be. It needs to forget about user-generated content and trying to monetize that and actively seek ways to entice more people to its professional content and make it a greater value proposition for its advertisers.

Of course, Google has already taken significant steps in that direction as of late with deals between YouTube and Seth MacFarlane that will see the “Family Guy” creator working on a series of short cartoon spots designed exclusively for Google.

But the company’s initiatives need to go far beyond just that. It needs to keep user-generated content on YouTube because that’s what people are looking for most when they go there, and try to support that section of the site with display ads. On top of that, it needs to coax more companies to bring professional content over and actively sell advertising on that content, which is not only controlled, but user demographics can be analyzed and advertisers will be able to determine if the site is worth spending money on.

YouTube is an extremely expensive endeavor for Google that has yet to bear fruit. But if Google is smart, it will listen to what the execs said at the RBC Capital conference and start to actively seek out professional content that will entice more companies to spend money in the space.

If it doesn’t, look for YouTube to look even more like a bloated waste of money.

Link to article

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IAB Marketplace: Network and Xchanges

April 7, 2008

The IAB’s inaugural Ad Networks & Xchanges event was held in NYC on March 31st. IAB President & CEO Randall Rothenberg kicked off the day by introducing the theme, “Teach me now, teach me how.” Attendees learned about the growing importance of exchanges and ad networks at panels and sponsor-presented breakout sessions.

The best explanation on the differences of exchanges and ad networks came from Christine Cook, Martha Stewart Living Omnimedia’s SVP, digital advertising sales during a panel discussion.

“Exchanges are increasingly interesting because it allows the publisher to set the CPM bar. We are still in control of our inventory. The ad networks do not offer that model,” said Omnimedia’s Cook.

William Morrison, an Equity Partners’ analyst, made the point that “hyper-fragmentation on the Internet presents challenges for marketers. Marketers are interested in video, blogs, RSS, mobile and social networks and they are asking the question, how do I work with them?” Exchanges/ad networks are bringing efficiency, reach and targeting to the media buying process and the exchanges/networks “that can give you transparency and control” are the best to work with.

Morrison also addressed the commodity issue that some parties associate with ad networks and exchanges. “Commodity markets show that porkbellies have increased in price seven percent annually during the past 20 years. There is definitely volatility in pricing but the overall trend is price increases.”

Carat Group Media Director Steve Ustaris said, “Ad networks and exchanges are revolutionizing the way media is purchased. Exchanges/ad networks allow you to reach a high volume of audience across multiple placements from one source. Ad networks, with the ability to segment audiences across multiple content verticals, are great for testing creative. Plus you can include the thousands of long tail sites.”

Ustaris noted potential benefits:
• Greater control of ad placement
• Determine true value of inventory
• Address cross-site duplication
• Greater understanding of site level performance

He feels the current challenges for media buyers include:
1. Risk versus reward: how many top tier pubs will participate and how much inventory will be available?
2. Current lack of understanding and infrastructure on the agency side to manage the new exchange system.

“Who is going to actually buy and manage the media? The jury is still out if it will benefit the agencies to use exchanges. Testing will tell us,” said Carat’s Ustaris.

The question of ESPN’s recent decision to stop working with ad networks came up through out the day. One publisher panelist thought the decision was interesting, “they must have determined that having control over all inventory by their internal sales force made the most financial sense.”

Later, Michael Kelly, Eyeblaster’s digital media advisor, investor and chairman of the board, mentioned that he had not spoken to anyone at ESPN but speculated that they feel “they can sell out all of their cross-media opportunities” with their internal sales force. He went on to say that “ad networks and exchanges are now growing fast and this is important.”

As our industry continues to evolve, the ad networks/exchanges will satisfy advertiser needs such as the audience scale issue. They will also drive the growth in efficiency-not lower CPMs, but ease of use. A media buying/selling process that is simplistic “will lead to growth. We need to simplify a process that can be very inefficient,” said Eyeblaster’s Kelly.

ANA’s TV and Everything Video Forum

March 6, 2008

The ANA held its inaugural “TV & Everything Video Forum” on February 28th in NYC. This loaded topic drew the largest audience the ANA has seen at any of forum to-date. Leading advertisers, agencies, content producers, research organizations and media sales organizations converged to review the paradigm shift taking place in the industry.ANA President and CEO Bob Liodice kicked off the day by talking about television as the dominant media for brand building. He also noted the declining effectiveness of the thirty second spot.

“Advertisers are looking at marketing accountability and integrated marketing communications platforms in their overall marketing plans. Those plans are being closely scrutinized and challenged at the C-suite which is demonstrated by the median 23 months that CMOs’ are averaging in their positions,” said Liodice. Clearly there is intense pressure on both advertisers and their agencies in evaluating the effectiveness of their marketing plans to reach the desired consumers.

The “10 Issues in 50 Minutes” panel moderated by Jonah Bloom, editor of Advertising Age, addressed the effectiveness issue. Donna Speciale, MediaVest president of video, investment and activation, noted that her clients’ media plans are shifting to a holistic view of video and reaching the consumer at all distribution points. In regards to TV ratings, strides were made in 2007 with the introduction of the Nielsen C3 ratings.

Speciale said, “C3 ratings showed that people were not watching commercials as we had thought.” The next step in bringing more granular information to planners will be when the “pod” ratings are introduced. The majority of attendees at the forum collectively felt that pod ratings, which are brand specific and are currently available in Europe, will be introduced in the U.S. within 3 years.

Karen Crawford, director, media advertising & relationship marketing at Nestle USA, said she is looking at the total consumer experience across all media. Whatever avenues get consumers talking about brands is key to her. DVR penetration, audience fragmentation, and increasing media costs demand that media companies be evaluated based on accountability and that ads are indeed viewed as reported by the research companies. She said that pod ratings had to be introduced in the near future to let advertisers know their media budgets are being spent wisely.

With respect to how the research companies are reporting broadband video audience data panel members agreed that the reported data is not consistent across the different services and that needs to change. TV and the Internet offer a powerful video advertising combination to reach audiences and more accurate measurement is needed for both media.

SportsBusiness Journal Staff Writer John Ourand, moderated the “Sports-The Challenges and Opportunities” panel. Live sports continue to be one of the few TV programming areas that is not DVR time-shifted. The ratings for the major sports leagues have been pretty consistent over the past decade and the advertiser demand in 2007 was very strong.

ESPN and ABC Sports Customer Marketing and Sales President Ed Erhardt stated that his programming is available across all three screens so consumers can access when they want to and on whatever devise they are using.

General Motors Executive Director, Advertising and Media Operations Betsy Lazar said that ESPN is one of the best networks in providing cross-media applications. She is a big digital video buyer who likes to test early, test often and grow the positive results that she finds in this media.

CBS Executive VP of Sports Sales and Marketing John Bogusz noted there is still a lack of inventory for the cross-media buys that he offers buyers. Bogusz said, “We will have around $500 million in TV advertising versus $22 million with online advertising for the NCAA March Madness.”

Johnson & Johnson VP-Worldwide Media Kim Kadlec gave the afternoon keynote. She asked the audience, “Who has the best insight into how consumers think: advertisers or the media?” She thinks that the networks know more about the consumer than the marketers and implored the networks to share that data. She uses the 360 model for all of her brands.

Kadlec said, “The Internet is the sweet spot and in 3 to 5 years Internet spending will exceed TV.” All media should do their best to share as many case studies as possible with advertisers so the best media plans can be implemented.

Forrester Research VP, Principal Analyst James McQuivey presented “The Future of Television Advertising”, based on a joint ANA/Forrester Research survey. National advertisers were asked about their attitudes towards TV advertising and the future impact of how new video distribution platforms will affect their TV advertising budgets.

McQuivey said, “The Web is giving advertisers what you want and you understand it: measurement, accountability and targeting. Budgets will move out of TV and the number one medium to get those budgets is the Internet.”

Mark Kaline, Ford Motor Company’s global media manager and chairperson of the ANA’s TV Advertising Committee coordinated this inaugural event. Other presentations included:
• Tony Ponturo, Anheuser-Busch VP of global media and sports marketing and president and CEO of Busch Media Group said, “Today’s consumers are elusive and tough to reach with advertising. A-B uses cross-media to effectively reach them.”
• ANA Chairman and Liberty Mutual Group SVP of Communications Steve Sullivan said, “…accountability is the holy grail. Advertisers’ need it from the media, and CEOs needs it from their CMOs.”
• TVB President Christopher Rohrs, NAB CEO David Rehr and Hearst-Argyle Television CEO David Barrett addressed “The Digital Transition” for analog broadcast television that takes effect February 17, 2009.
• Microsoft Corporate VP of Global Marketing Jeff Bell presented “Gaming- Consumer Insights and Lessons for Advertisers” which clearly showed that millions of consumers of all ages are online and offline playing games.
• The Convex Group Founder Jeff Arnold spoke about integrated cross-media platforms and their effectiveness.

All of the presentations were very good and addressed the future of video. I am sure next years event will be even larger than and as insightful as this year. See you there.

Inside Digital Hollywood–Thursday, Nov. 1

November 3, 2007

ibm.jpg “The End of Advertising as We Know It” is an IBM study that will be released next week, per IBM Global Media & Entertainment Leader Karen Feldman. Karen and I were on the same Digital Hollywood panel, Advertising Innovation! Broadband, OnDemand, In-Game, Social Networks, RSS, Blogs, PODs & Mobile, at Digital Hollywood on Thursday. The study’s control group was 2,400 demand-side global consumers. It will address media consumption and advertising preferences by age group along with revenue models for both paid premium and ad-supported content. For media buyers in the control group it is determined that ad marketplaces, like SpotXchange, will see increased adoption by agencies over the next three years and 30 percent of their total ad spend will be placed through the marketplaces. It was also recognized that online marketplaces across all media are needed to bring both efficiency and transparency to the media buying and selling process. This sentiment was given by former CNN Sales & Marketing Director Larry Goodman in his October interview with SpotXchange CEO Mike Shehan (http://blog.spotxchange.com/2007/10/05/larry-goodman-interview/).

Another hot topic (that I noted in Wednesday’s blog entry) was that budget allocation is still not based on consumers changing media habits that heavily favor Internet usage. Driven by broadband penetration, shifts can be noted both at home and in the workplace. Issues challenging the shifts include digital rights negotiation during ad production along with the length of the ads which prevents agencies from moving television budgets to the Internet. This will be addressed during the 2008 creative process. With improved standards for measuring and delivering video ads across all access points budgets will start moving into the broadband channel. This all will ultimately help speed up “The End of Advertising as We Know It”.

Inside Digital Hollywood—Wednesday, Oct. 31

November 2, 2007

Broadband Advertising: The Power Surge took center stage at Digital Hollywood on Wednesday as a panel moderated by 360i Director of Emerging Media David Berkowitz addressed the multiple tactics that can be employed around broadband video postings/advertising.

Media-Screen Managing Director Josh Crandall set the tone by showing his company’s research on U.S.broadband audiences. The Netpop Report (Trends: Online Activities among U.S. Broadband Users, 2006 and 2007, http://http://netpopresearch.com/node/23623) showed that modern, influential online consumers share opinions with their online circle of friends and the Web community at large. Broadband is clearly out of the early adopter phase and into the mainstream with 127 million consumers at least 13 years and older accessing it. When it comes to product purchase decisions consumers are spending 2.6 hours online versus 2.2 hours offline gathering information before making purchases.

Deep-Focus Media Director Eric Druckenmiller described how broadband allows the consumer to have a richer online experience with brands. For his entertainment clients Eric employs multiple tactics like video postings, search and publicity targeted to niche audiences to build a viral ground swell before reaching a much broader audience. Jason Klein, Special Ops’ co-founder/CEO, takes a similar approach targeting loyal consumers who recommend the brand to their social circle. It is all about building buzz for a campaign before a national launch. The entire panel endorsed using the social networking tactic for entertainment brands to facilitate viral distribution of the brand’s online message.

Josh wrapped up by stating that based on what is influencing purchase decisions he is amazed that brands are giving online such a small slice of their marketing budget versus T.V. and radio. Clearly online budgets would increase if the allotment was based on the consumers’ media habits, overall audience reach and the ability to build brand favorability among consumers.

Inside Digital Hollywood–Tuesday, 10/30

October 31, 2007

Last night’s keynote dinner at Digital Hollywood (http://digitalhollywood.com/LAFall07Agenda.html), Web 2.0: Technology with a Human Dimension was an impactful discussion on online brand marketing-specifically in consumer engagement.

It got lively as HBO SVP Steve Pamon sparred with the rest of the panel. The debate pitted his view, the digital space as a stand alone distribution platform against the rest of the group’s stance, recognizing that the brand needs to reach the audience wherever the consumer wants to watch it. Nada Stirratt, MTV’s executive vice president of digital advertising, summed it up nicely by saying MTV wants to let the consumer interact with the brand on whatever platform they are using, e.g., T.V., broadband, mobile.

Dwight Caines, Columbia Tristar Marketing Group’s executive vice president for worldwide digital marketing, hosted and emceed the discussion. Right out of the gate he stated the most profitable customer that he reaches is tech savvy. Matt Cohler, Facebook’s vice president of strategy & operations, discussed how these consumers now have the distribution network for sharing information and content with friends more effectively than ever before. When consumers share the content, then that content is deemed good by that sphere of friends and is then watched. Most of the content being shared is professional but if it is UGC, then it is accepted.

When it came to advertising, there was agreement that advertising needs to be relevant to the content environment and ideally would be viewed as additional programming versus an ad. Aaron Earls, co-founder of New Media Strategies, said that the consumer needs to find value in both the content and the advertising and if you can deliver that combination, consumers will engage with your brand online.

From the reaction of the 240 people in attendance both during and at the conclusion of the discussion, the panel’s viewpoints were well received.

ad:tech NY 2007

October 24, 2007

small-blood.jpg Yes, it’s that time of year again! The grand-daddy of all online shows for the interactive marketing community reconvenes in the advertising Mecca of New York City for ad:tech NY (http://www.ad-tech.com/ny/) on November 5-8th. This year’s show promises to be no different than those in year’s past; chaotic and frenzied with little time to accomplish anything with absolute certainty. However, if you are able to pry yourself from the BlackBerry and your feet are asking for a break, stop by any number of presentations being held on Emerging Platforms.

Yesterday’s MediaPost article by Cory Treffiletti, “Defining Catalytic Media; Beyond Standard Opportunities” should aid in fueling your attendance to several of these panels on advertising exchanges and video. These are the newest innovations that stand to have the greatest impact, including overall growth potential, for years to come. These presentations will, if nothing else in my opinion, leave you a bit more informed about online video, video networks and exchanges and hopefully will leave you asking several questions-isn’t this what life is all about?

Here is a list of four panels in no specific order that I recommend to those interested in online video:

Wednesday

Video+Search+Contextual Targeting: Is the Holy Grail Upon Us?

Analyzing Online Advertising Exchanges

Thursday

Video Workshop

Digital Advertising Networks: Making Sense of an Evolving and Expanding Landscape

SpotXchange is an ad:tech exhibitor, booth # 2114. Stop by after attending one of the above panels and let us try answering your questions about online video advertising. We can’t promise we will have all of the answers but we might just leave you asking more questions!