Shifts in Viewing: Video Consumption Up, TV Down

How appropriate that Nielsen’s new Cross-Platform Report is called “Shifts in Viewing.” You would have to be insensate not to know that people are consuming  more digital video. We know it because our video content publishers are seeing rapid upticks in traffic. In summary, the report says that although TV viewing has declined, most sharply among young people, not only has digital video viewing gone up, but the total time people spend interacting with has increased. Therefore, as Nielsen says charitably, we should not look at this shift as a game with winners and losers, but instead as an opportunity for everybody. Opportunity indeed. This must be what newspapers were told when news moved online twenty years ago. I’m not sure the opportunity here is for TV stations as much as it is for advertisers, who now have a solid new channel, mobile video, through which to reach those customers who have disconnected from TV. And according to Experian Marketing Services, that number is now 7.6 million households — up 44% in the past four years. But not having TV reception doesn’t faze them. fact, year over year among the younger 18-34 demo media consumption has grown four percent overall, two percent among Hispanics, eight percent among Blacks, and ten percent among Asians.  That’s because the young are looking at TV-like programming on their phones and tablets..  Nielsen says, “We are seeing year over year overall growth in digital use of sixteen percent among persons 18-34 with fifty-three percent growth in digital video viewing. ” But the truth is that not only the young are increasing the amount of video they consume online. Fast growth is also reflected in the 35-49 group, and the 50-64 demographic is surprisingly the fastest growing group of digital video consumers. Digital video consumption in this group  increaed 60%. TV viewing is down in every age group. And we look for that trend to continue, because this report shows that the highest increase in number of hours spent consuming video are spent on either time-shifted TV or mobile phones. Once the time-shift pattern was established, it became only a matter of time before video shifted online, and especially to the smart phone. As a culture, we’ve made a shift and we won’t be going back. Indeed, as phone screens get bigger, we expect video viewing on mobile phones to increase even faster.

Innovation in Ad Serving

I found this post about ad servers on Darren Hermann’s blog, and it underscores why we’re going in the direction we are going.

“If I personally was to start a company tomorrow, I’d probably create the next 3rd party ad serving system built for the future of all media (able to serve site-direct placements, social media and RTB) and include the opportunity for biddable, rich media, video, and full reporting & analytics.  I believe no ad serving system delivers superior reporting and analytics so this is an area that I’d specifically make sure I’d nail.”

He’s right! We are moving toward greater and greater focus on analytics for our publisher customers so they can use those analytics for their advertisers — the agencies and brands.

“I think this is an area for massive innovation because… the industry hasn’t recognized the full vision for the future… I believe that all media will be served, tracked, and optimized across all channels.  Television, print, radio, and out of home will all in some way or another be served, tracked and optimized.  This obviously cannot happen overnight as there are quite a few barriers and obstacles to go thru, but the opportunity is huge.  There is a reason why 87.5% of the companies in the ad serving segment have been acquired.”

Note, I don’t think you need to start from scratch.  If you could raise some money, you can start by acquiring several of the pieces.  There are quite a few DSPs who could use an exit right now.   There are even some large independent ad servers who would be interested.  A roll-up strategy would be interesting and something that could come together nicely.

One of the bigger parts here is that you need to service the advertiser (or marketer).  This needs to be written on all company walls.   Mandated thru corporate handbooks.  This is similar to how SSP’s service the publisher.  You cannot be all things to everyone and when this happens, decisions sometimes become very tough to make as you try to please too many constituents.  Think about all the decisions Google (and Admeld) had to make about where to flow it’s ad dollars – to Google-run sites or it’s 3rd party network of sites.  Stick to one core area of focus and innovate within it.

Darren is right on. From the beginning, we’ve been a partner for publishers. And the publishers are the partner of advertisers. The most important part of the future of digital advertising: collaboration and partnership. The next most important part: measurement that is meaningful.

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Tablets and Newspapers: A Match Made in Heaven?

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According to Forrester Research, the U.S. tablet market is about to explode, and 82 million Americans — one third of the online population — are projected to own one of the devices by 2015. The announcement of the $199 Kindle Fire by Amazon means that the tablet will be a means for advertisers to reach people who can then buy their products almost immediately, on Amazon and elsewhere.
These tablet numbers fit well with the growing rate of U.S. online retail sales, which increased 12.6 percent in 2010 to reach $176.2 billion and is expected to reach $278.9 billion by 2015.

According to Editor and Publisher, “If newspapers connect the dots accurately, they may be able to design a revenue masterpiece worthy of hanging in the Louvre. Blending e-commerce, tablets, and apps on a strategic business palette, coupled with a few strokes of marketing genius, newspapers have an opportunity to regain a hefty chunk of lost advertising dollars.”

All this great news comes from Forrester analyst Sucharita Mulpuru’s report “Why Tablet Commerce May Trump Mobile Commerce.” Currently, only 9 percent of Web shoppers own a tablet (most of whom already own a smartphone or computer), but tablets are their preferred device for shopping. Users prefer the larger screen size and the opportunity to flip pages similar to a print catalog. Eighty percent of tablet owners use them in the comfort of their living rooms, which offer a leisurely shopping experience and cultivate increased browsing time.

All this would seem to be obvious. But what does it mean for newspapers? Editor and Publisher’s Jeff Fleming has a clever idea:

Think “buyerlog,” a newspaper’s answer to a catalog. For example, newspapers could create weekly buyerlog apps, which are an amalgamation of advertisers’ products and services — offering subscribers a wide variety of categories, such as travel, real estate, major appliances, furniture, and the coveted classifieds.

Online shoppers in the market for a new sofa and chairs would be able to request or download a newspaper’s furniture buyerlog and browse a wide-ranging selection of styles, colors, and prices from numerous manufacturers and retailers. Shoppers could relax in the comfort of their homes, flipping pages that include interactive content, videos, audio, and large colorful photos.

With large subscription numbers and a diversified advertising base, newspapers are in an ideal position to dominate the buyerlog market. Subscribers would no longer need to jump from one website to another, benefiting from a newspaper’s ability to include multiple advertisers in one complete package.

Relatively cheap to produce and affordable to large and small advertisers, buyerlogs could offer newspapers a chance to earn digital advertising dollars and take ownership of the up-and-coming tablet inundation.

If I were a newspaper publisher today, I would be thinking of tablets rather than mobile as my next consumption platform, and I’d be optimizing my online site for the tablet revolution.

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