Online video – a balancing act between ad revenue and user experience
One of many challenges faced by traditional publishers embracing the multimedia world involves online video. How can they successfully incorporate video content in their digital offering, generate meaningful volume and effectively drive revenues, without damaging the user experience? Mark Davey InSkin Media's Director of Publisher Services, Europe, investigates.
In the UK, a high percentage of videos viewed online are consumed on a relatively small number of sites, dominated by such publishers as YouTube, Facebook and the BBC. Many traditional publishers have not been able to capitalise on the ever-increasing user demand for video content, and the overall growth in video consumption.
While mass-market reach is not necessarily a key priority, especially for those in specialist markets, the number of video views on many sites is often disproportionately low, compared to overall user numbers. With strong brand values, credibility and trust, these publishers are well positioned to further expand their online video proposition and create a supplementary revenue stream.
One of the key challenges they face in building video traffic is in transforming online video from a cost to a profit centre. The costs involved in creating or acquiring content, and delivering it effectively to gain traction with the target audience, can be significant.
The need to show a return on this investment can lead to advertising solutions and formats that detract from an optimum user experience. This is not conducive to increasing video views, and is more likely to create a negative experience for users and reduce consumption, delivering a blow to the publisher's credibility in the process.
Creating a great experience for the user is at the heart of all quality digital properties. In the online world of short-form video content this is even more pertinent: a 30 second ad in front of a 30 second video clip is not an ideal experience for the user, and can reflect poorly on both the publisher and the advertiser.
Providing relevant content which is appropriate to its environment, understanding user behaviour and implementing suitable advertising solutions will help create a better experience, and leave a better impression. This in turn will help to increase average time spent consuming video content, drive video views and ultimately increase advertising revenue.
In the world of 'skipable' ads, 'in view' advertising metrics and diminishing CPM rates, it is important for publishers to create and manage premium advertising inventory that works in harmony with the users' preferred experience.
Online video presents a real opportunity for advertising brands to reach consumers in an engaging environment, where average time spent far exceeds standard online web pages. Choosing the most appropriate ad format, delivered at the right frequency, in the most relevant context will help maintain the balance between advertising revenue and a positive experience for users.
Among many innovative formats on the market, an ad-served wrapper around the video player provides a canvas for brand messages, an additional tranche of inventory which does not encroach on the users' viewing experience, and a new revenue stream.
The long dwell time generated by video content ensures that branding remains in the users' eye-line, and multiple click events deliver a relevant opportunity to interact at any point. The increased inventory created by combining standard in-stream advertising and branded players allows publishers greater flexibility to implement tighter frequency capping and the optimisation of video clip length.
This approach opens up significant opportunities for video monetisation, while ensuring that the experience for the user is carefully considered - vital for any long-term video strategy.
The digital environment is set to become even more complex, fragmented and challenging. Tablet devices have become ubiquitous, since the arrival of the iPad in 2010, and the rapid development of smart-phones has further changed how, when and where we consume our daily content, including video.
In fact, tablets are fast becoming the online entertainment device of choice, with recent figures from the IAB suggesting that tablet views add an incremental 15% of views to online video content.
The responsive and adaptive design movement is gaining traction, as publishers look for ways to more efficiently manage the distribution of their websites and content across the multiple available devices.
Online video will continue to play an integral role for publishers in terms of their content strategy and advertising proposition. The ability of publishers to offer users a choice in terms of which ad formats they prefer, the advertising message they are happy to receive, combined with frequency and context considerations, will ensure they are well positioned to achieve the best balance between advertising and an optimum user experience.
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