Wednesday, March 18, 2009

Top 10 Investor Questions For Online Video Publishers

I continue to hear the same excuses over and over from start-up online video publishers about their failure to generate sufficient CPMs (Avg. $.25 cents to $1) to survive as a profitable business. Should the blame be directed at advertisers and their agencies or should the blame be directed at the publishers themselves? I believe there is still a huge online publisher problem that has been perpetuated by big media's continued dependence on brand advertisers and phony Nielsen TV audience measurement platforms.

During economic growth cycles advertising terms are dictated by big media publishers who sell impressions and scarcity. This recession is different for big media and may require publishers to become much more sophisticated about accountability, engagement and action. What would GM look like today if they had been smarter about spending billions of TV ad dollar on a performance basis?

This disruption in advertising dollars has created an emerging opportunity for sophisticated publishers regardless of size and scale who can target, segment, engage and create actions for their advertisers and agencies. Here are my top 10 questions I ask of any video publisher . . .

1) Do you produce any unique content for your network to create premium ad inventory?
2) What metrics are you using to sell and measure video engagement for your advertisers?
3) How sophisticated are you at selling your advertising direct versus through an ad network?
4) What techniques are you doing to engage your audience with rich media?
5) Are you segmenting and selling your audience to brand and direct response advertisers?
6) How are you using social media (Twitter, Facebook) to keep your audience engaged?
7) What analytics tools are you using to segment your inventory and sell ads efficiently?
8) How are you selling your remnant advertising?
9) Are you optimizing and routing your inbound viewer traffic?
10) What portion of your viewers / traffic comes from outside the U.S.?

2 comments:

  1. One of the biggest frustrations media buyers at ad agencies had in the pre-Web era was not having enough tracking tools to know whether a spot on the Tonight Show or an ad in People magazine would work -- and be worth buying.

    One way media buyers deal with this challenge is to choose an editorial environment that attracts buyers of the advertiser's products. This is why you see more cosmetic ads in fashion magazines than in car magazines, and more car ads in car magazine than fashion magazines.

    The editorial environment is important because it's easier to sell a product to someone who is "in the market" to buy that product. This is, of course, why Google's search ads work so well.

    In the online world, media buyers have a somewhat easier time determining if a particular site is working by monitoring the traffic and conversions of people from that particular site. However, the increased transparency of analytics can work against certain Web properties.

    I love analytics -- I've got a ton of data on our visitors. But more analytics doesn't mean more ad revenue.

    I'm sure someone could create a video site that focuses strictly on the unusual behavior of cats -- the more unusual the better. Audience engagement and loyalty would probably be very high. But could the site's sales team sell a media buyer on placing ads on the site? In other words, are the site's visitors "in the market" to buy the advertiser's products?

    If you're the media buyer for Purina, sure, it could be a good deal.

    However, is it a good ad environment for all the other types of products? Yes, at a price. When only a small portion of an audience will buy a product, media buyers bid down the price of ads on the property until the cost/visitor or cost/conversion matches other sites.

    The owners of many content sites focus on increasing traffic, time on site, and other metrics, but don't focus on creating a positive ad environment for sponsors and advertisers.

    A good publisher -- whether it's a magazine or a Web site -- knows that their role is to create an editorial environment that brings together the audience and advertisers so that a sale is made.

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  2. I have a video of the band Nirvana, and some other sub-pop bands taken at a club in Seattle. It is great and a fight breaks out, it is totally original. No one else has it. How can I sell it?

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