The perfect video breakdown

The digital ecosystem is becoming increasingly complex, as brands split their video budgets between online, mobile and connected TVs. So what’s the optimum mix? Rhys McLachlan, Director of Corporate and Business Development at Videology, investigates.

Video convergence is now a reality. More consumers are viewing more video across more screens. The ability to view video content whenever and wherever is now a reality for 36 million Brits – almost one in two – who own a smartphone.

Add this to the small but growing body of consumers who watch video on their television screen through a connected TV or internet-enabling device, such as X-Box, and you have an increasingly complex web of video convergence.

Where consumers lead, marketers must follow. We believe that in 2013 advertisers in the UK will increasingly begin planning device-agnostic, holistic video strategies that connect with consumers where and when they are watching content, regardless of screen.

The challenge is to get the balance right between efficiency and effectiveness. Most brands will look at two key metrics; click through rates and video completion rates.

We recently conducted a research study analysing data from multi-screen campaigns running through our platform between July 2012 and October 2012. Based on 486 million online impressions, 15.2 million mobile impressions and 7.75 million connected TV impressions in the UK, on a placement that was not via RTB, we’re able to offer clear insight on what each platform delivers.

Click Through Rate

We know that click through rates vary significantly based on a variety of contributing factors including advertising category, demographic targets, frequency and relevancy of messaging to a given consumer. However, there is also a significant variation in CTR based on device.

Mobile, for instance, shows much higher CTR in comparison to online video. The reasons are varied, and they include stronger call to actions and incentives, such as discount vouchers or location-based promotions, or simply a more personal one-to-one connection with the consumer. Whatever the cause, mobile shows a 140% increase in CTR in comparison to online video.

Since the majority of connected TVs do not allow a viewer to click through on an advertisement, this metric isn’t really relevant.

Video Completion Rate

Like CTR, VCR shows significant variation based on device. Again, just as the majority of connected TV devices do not currently allow a viewer to click through on an advertisement, they do not allow a viewer to bypass an advertisement.

As a result, what is a detriment in terms of CTR is clearly an attribute in terms of completion, with a 17% improvement vs. online video performance.

Mobile is comparable to online video with just a 2% boost in performance. As targeting capabilities and relevancy of messaging on mobile devices fall in line with online video, so too, we believe will completion rates.

For many advertisers, however, the technicalities of the online video world are less important than the more generic (and comparable) measure of brand awareness.

Though awareness is a more subjective measurement, our BrandScore tool enables us to compare reported awareness between consumers who were exposed to a given video advertisement, versus a control group who were not exposed.

We analysed a sample of campaigns that ran across multiple screens: online, mobile and connected TV and compared them to another sample that ran only on online video.

Out of the campaigns analysed, online video on average drove a 33% lift in brand recall compared to those exposed to no advertising, while three-screen campaigns on average drove a 90% higher lift in brand recall than online video alone.

Of course, there are two other factors to take into account when it comes to assessing efficiency as well as effectiveness: scale and cost.

As our brand analysis suggests, few advertisers are well-served by focusing 100% of their video ad spend in a single device. For instance, a video advertiser interested in achieving high CTR might use mobile to improve ROI against this metric.

Yet, approximately only two out of three smartphone owners in the UK – about 24 million consumers – use them to watch video. This is a significant and growing number, but it is still much lower than online video. Similarly, connected TVs are currently only available to approximately 17% of the UK population, according to a 2012 Kantar study.

Taking these factors into account, our analysis shows that adding mobile and or connected TV to an online video campaign can boost performance significantly for a minimal increase in cost.

The degree to which an advertiser needs to split their budget clearly depends on their marketing goals. In 2013 – given the state of device adoption and usage and our own research, we believe the guidelines for advertisers should be:

• The optimal mix to achieve both scale and performance should generally see between 60 – 70% of video budget allocated to laptop/PC and the remainder allocated to mobile and connected TV.
• If an advertiser has aggressive click through goals, they should eliminate connected TV from the mix, (increasing percentage allocations to mobile and laptop/PC)
• If an advertiser has aggressive reach goals, they should consider allocating a higher percentage (closer to 70%) of video budget to laptop/PC, since it has the largest reach of all three screens.
• If an advertiser has aggressive brand awareness goals, they should divide their video budget between all three screens, allocating 60-70% to laptop/PC, with the remainder allocated to mobile and connected TV depending upon desired audience, content partners, creative execution and supporting objectives.

Clearly these guidelines will change as the usage and reach of mobile video and connected TV increases, but for 2013, we believe this is the best possible basis on which to allocate video budget.

A full copy of Videology’s Video Convergence whitepaper can be downloaded here.