Online video audience: majority skews older

29 08 2007

Advertising.com has released results of its bi-annual online video study for the first half of 2007, revealing some marked differences in the way audiences younger and older than 35 are using the medium.

Shattering preconceptions that online video is the domain of younger audiences, the survey finds that the majority (69%) of users are aged 35 years or older (v. 31% of 18 to 34s).

However, the type of content viewed by each age segment provides some interesting clues on how content providers should be targeting their offers. Page 3 of the report finds that 18 to 34s like music videos best, followed by TV shows. While around a third to a quarter of 35+ audiences favour the same, the overwhelming majority (69%) like news clips best.

Almost two-thirds of 18-34s say they use online TV for catching-up on missed broadcast episodes of favourite shows, with almost a third also saying that online video is eroding traditional TV viewing time.

94% of respondents say that they’d happily suffer commercials online if it meant that the content was free, but advertisers take note: two-thirds favour shorter spots than those which run on linear TV and almost a quarter believe these should be more relevant to users’ interests.

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Online video ads which work: the first answers emerge

13 08 2007

The Wall Street Journal claims evidence is mounting around which online video advertising formats work, predicting that experimentation during 2007 will give way to the serious money moving in during 2008.

Graphic overlays and ads surrounding online video player consoles are among the formats believed to have the greatest impact with consumers so far. The piece also cites research from Ogilvy Interactive, which suggests that contextual ads have three times the rate of cut through.





AOL’s woes deepen; bring me the head of Richard Parsons

7 08 2007

A long time ago in a galaxy far, far away AOL once had 30 million subscribers… today it has 10.9 million.

The company failed to predict consumer appetite for broadband, that the internet and walled gardens don’t go together, and it was as late as last year that AOL finally began the move from subscription to ad-funded access to its content.

At a time when advertising $$$ are pouring into online, AOL’s results are heading south again. Onlookers thought the rot had stopped last quarter, when the company posted a 40% gain in online ad revenues; yet three months later this has more than halved.

On the plus side, the company has reported an increase in page impressions, for the first time since 2005.

CEO Dick Parsons statement reads as more of an apology than a tease of the company’s prospects: “We remain confident we’re on the right track,” he told investors, adding without a tinge of irony, given the latest set of numbers: “AOL is in fact reasserting itself as a leader in the online advertising space.”

Parsons claims the company is playing the long game: “We don’t manage this company for the guidance. We manage this company according to the business imperatives and for the long-term growth and sustainability of our business.”

We’ll see…





ComScore refines online metrics

29 07 2007

Web measurement firm ComScore announced last week that it is to refine its methodology, splitting out heavy, medium and light users – reports the Financial Times.

The 20 per cent of internet users who spend longest online will be defined as heavy. The remaining audience will be defined as 30 per cent medium and 50 per cent light, using the same time-based criteria – the report states.

according to ComScore’s analysis of US web traffic, heavy users on average spent almost 97 hours online during May. The average time spent online among the light 50 per cent of the US web audience was just 3.6 hours. But when this is reported as an average across all US web users, ComScore’s figure rises to 28.8 hours.

Heavy users also visit a much larger number of websites and view more individual web pages than the “light” 50 per cent. If widely adopted, ComScore’s reforms could encourage advertisers to look beyond the most popular websites and seek out those visited by harder to reach medium and light internet users.





Forecast: internet TV advertising to be worth $10 billion by 2011

29 07 2007

Online video advertising is set to take 18% of all internet ad revenues by 2011, according to a forecast published last week by research firm Understanding & Solutions (U&S).

“There is an Internet TV ‘goldrush’ in progress,” says the company, “as mainstream broadcasters, cable networks and TV content producers move their content online alongside a new raft of legitimate ‘Webcasters’ (Internet Video and TV aggregators) like Joost, Vudu and Babelgum.”

“Globally, we estimate there are more than 20 billion videos being streamed across the web each and every month. In the US alone, active Internet video users are streaming an average of 55 videos per month – and this is just the beginning,” said U&S principal consultant John Bird.

“Online video is growing at around 200% each year and, going forward, television will be a primary driver. Major US broadcast networks are already reporting tens of millions of streams monthly from their websites, but to build sustainable revenues the industry needs to effectively engage with consumers to understand what works, it needs to establish re-transmission rights and develop audience measurement techniques.”

Unlike music and film industries, which operate with paid-for content, television is predominantly a free-to-air market and lends itself to the Internet. The challenge for the industry will be in harnessing the power of the medium and developing the revenues through sponsorship, advertising, subscription and paid-for business models. Piracy and ‘free’ TV content on file-sharing networks will be an endemic problem faced by the emerging business, as has been the case for the music industry over the last 10 years.”





Veoh’s new CEO on the challenges ahead

28 07 2007

Some interesting (if obvious) quotes in this Ad Age interview with Steve Mitgang, the former Yahoo exec tasked with leading the company’s ‘Panama’ search iniative and recently appointed CEO of online video aggregator Veoh:

Ad Age: Why has it been so hard to create a viable business around online video? It seems to be wildly popular among consumers.

Mr. Mitgang: According to the reports, YouTube only sold $30 million in ads last year because they didn’t build a system to support … that healthy tension between editorial and advertising. They just didn’t build it. They were trying to grow [an advertising vehicle] out of a legacy position as opposed to starting out the right way. We’ve built and are enhancing a discovery and recommendation engine to give users the right video and discover gems. Not just show you what you’re looking for. The flip side of understanding those user behaviors and recommendations is for targeting purchases. We can say, look at the car enthusiasts … [these ones] are primarily interested in German cars or muscle cars. Being able to tell that to the brand manager of Mustang or Mini, we’ll be able to help them better than anyone else. Whether watching user-generated or premium content we’ll help target against the right users.

Ad Age: From a consumer standpoint, how does the recommendation engine help?

Mr. Mitgang: There are big problems on horizon for video that we’re solving. In a world with billions of videos, it’s harder for people to know what’s interesting. That’s why building discovery or recommendation engines is key. Search only solves a transactional problem. Whether you’re shopping at Amazon or Netflix that discovery process is an important one. When people are using video more completely, in a 100,000 channel world, discovery’s important. How you manage videos is important, along with how you manage your bandwidth and disk space.





What’s holding online video advertising back?

26 07 2007

Wave, after wave, after wave of research suggesting that consumers (especially younger ones) are spending more time watching video online; tet the ad $ have been slow to move in. Why?

Take Procter & Gamble – the biggest advertiser in the world – which over recent years has accelerated the amount of spend away from traditional media and towards online. What aren’t the rest getting?

Well there’s the small problem of measurement, for starters: Nielsen/NetRatings may have made a bold announcement about standardisation, yet implementation is still some way off.

Meanwhile, eMarketer claims 2007 is the year where ad spend on online video will rise by 89% . What are we waiting for?

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In a word (or several): the big trucks rolling into town.

It’s unlikely the effects of new launches from the NBC Universal / NewsCorp. ‘newsite’ launch, Comast’s major web drive, Joost out of beta and the BBC’s non-public service iPlayer launches will be fully felt at least until next year. Which is why next year the figures for ad spend suddenly start to leap. Advertisers need proof-of-concept, not stuff for shareholders.

Then there’s honing understanding of the type and duration of advertising which will work with online users.

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The same eMarketer study, suggests existing approaches remain fragmented and confusing. The one thing that’s overwhelmingly clear, the ad-funded model is here with us for good, as only a tiny minority of users are prepared to pay for online video:

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More granularity still when it comes to exploring consumer attitudes towards the context of accompanying ads:

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And then re-posing questions concerning ad durations:

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