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Good-bye :30 Spots, Hello Digital Video Creative

Seriously? Digital  is now the second biggest advertising market and we’re still using 30-second spots? Has anyone really thought this through?

The research on whether people will watch video online, and for how long, is in. While we used to think two minutes was the outer limit, we now know that it’s over five for a good story, especially on a tablet. Younger people have moved from TV to digital in large numbers, and even little kids reach for the tablet before the TV. In theory, this could change the delivery of advertising, allowing for both longer and shorter ads, and unleashing new powers from creatives.

To keep up with their customers, brand advertisers are shifting their metrics from CTRs to completion rates. Completion rates are not a function of time; they’re a function of good story telling. A good story keeps people engaged and produces more brand recall than any 3o-second spot ever did. If we get away from the limitations caused by time, we’ll be a lot better off. Without the temporal limits of TV, we can tell different kinds of stories.

Mobile is a great place for video ads. Buzzfeed founder Jonah Peretti once said that his site was for the bored at work, bored in line audience, and those are the people who will watch a video that tells a good story, even if it’s conceived and even executed by a brand. In fact, IAB just did a study of video watching on mobile devices:

 many respondents said that they’re watching more video on mobile devices than they were a year ago, including 50 percent of those surveyed in the United States, and 42 percent in Canada, New Zealand and South Africa.

They’re not watching 30-second clips, either. In fact, 36 percent of respondents said they watch videos that are five minutes or longer on a daily basis. (That’s not a majority, but it’s more than just a tiny sliver of the audience.)

The IAB says that viewers in China are particularly open to watching movies and TV episodes on their phones. In addition, 37 percent of respondents in China and 35 percent in Singapore said they’re watching less TV due to watching more mobile video.

We suspect that next year publishers will be seeing many new in-app and in stream formats that don’t look like 30-second spots.

 

Does Video Advertising Work?

The consensus forecast in the ad industry is that video advertising has been the big opportunity for 2015. Although “cord cutting” is not increasing as quickly as some trend spotters have predicted, we have now bred a generation of adults who have never been connected by a cord . Millennials simply never order cable in the first place; they use their TVs, if they have them, as giant displays for Chromecast or Airplay.

We’ve known for a while that Millennials also watch TV on their mobile devices, and that they were willing to watch videos longer than two minutes.  In fact, this year all other market segments seemed to go mobile at once. For a while the ad dollars didn’t follow the viewer behavior, but now Adexchanger’s Data Driven Thinking columnist says, “…based on… discussions with major brands, agencies and advertisers, TV advertisers hope to shift roughly 30% of their $70 billion TV ad budgets to digital video by 2015. That would increase the US market to $21 billion, up from $6 billion in 2013.”  Based on information half way through the year, the actual numbers will be bigger.

These budgets are big enough that we must now begin to measure how well digital video advertising works. The rating system for TV, GRPs, hasn’t been a good measurement for quite a while, although we didn’t have any reason to complain about that before digital advertising unlocked the power of actual data. When TV first came on the scene, GRPs measured who was watching a show, and thus you’d know who was watching the ads. But since 1999, when Replay TV first introduced the DVR with its ability to skip ads, GRPs have become less and less an accurate measure of whether a TV ad led to a sale.

We hope that with the tsunami of ad dollars to mobile video, we won’t make the same mistake we did with digital display — turn it into a platform for performance advertising and drive publisher revenues down through the floor. It has taken us more than a decade to recognize that brand lift is a valid objective for online advertising. Now, with mobile video, we should come around much faster to realize that the best way to measure online video ROI might be against TV ROI, which is an apples to apples measurement. TV, of course, has been justified for its capacity to produce brand lift as well as just performance. Digital video, executed well through formats like our inArticle video,  will do the same.

 

 

Video Advertising Will Be as Effective as TV: Update

About two years ago, I wrote about my belief that  high quality publishers could make Internet advertising work at least as well as the best TV advertising. At the time, that was a pretty lonely position. In a world of banners and remnant inventory,online advertising was heading toward commoditization. Yet I continued to believe that we could make Internet advertising work brilliantly for high quality product launches and brand building and also that we wouldn’t always be stuck with text based CPC ads.

This year, with the launch of our ZINC high impact formats, we’ve begun to show that the best sites can indeed run fantastic graphic and video ads that sell great products. Agencies are buying those ads for quality brands.

We’ve been validated by a marketplace that seems finally to have discovered the value of online ads for brand building purposes. The convergence of mobile and video has made that happen; more online video ads are watched than TV ads. According to the Pew Research Center,

tablet ownership in the U.S. has nearly doubled in the past year, with 34% of American adults owning a tablet, up from 18% a year ago, according to the Pew Research Center. With 56% of these tablet owners living in households that earn at least $75,000 annually, publishers are pitching brands on reaching affluent audiences.

Fortunately, we had already developed our suite of high impact formats, including the InViewSlider, the Shuffle, and our full screen video. These formats have been tested and deployed by premium publishers in the US, Europe, and Asia. They are getting great results and making agencies very happy. Needless to say, the increased revenue makes our publisher partners happier, too.

I’m still looking toward the day we measure something besides CTRs, an irrelevant metric for brands. Viewability should be a more important metric than click-through rates; think of the traditional billboard along a highway — you don’t do anything when you see it, because you’re driving. But it might make you take action later. That’s brand lift.

Another new measure for video advertising might be engagement, or how much of the video ad did you actually watch. There’s no substitute here for great creative that can keep a visitor watching through to the end of the ad.

It has taken a while for brands to get comfortable with online advertising for brand awareness, but with the combination of new formats like full-screen TV ads on the web and better creative, we’re heading in the right direction.

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