Do you want your ad next to video of teenagers throwing kittens in a river?
In this guest posting, NineMSN’s Andrew Hunter argues that brands are taking unneccessary risks when they advertise against user generated content or autoplay video – which is why ad revenue does not necessarily follow the audience.
Recently YouTube’s Karen Stocks wrote the reason advertising dollars weren’t flowing to user-generated content was because marketing people didn’t understand the viewing habits of the digital audience. She seemed to be saying that because users did not discern between UGC and “premium” content, nor should advertisers.
When you look at YouTube’s UGC-heavy content mix, it’s an understandable position. Understandable, but somewhat disingenuous. Content quality and environment matter to both users and sponsors.
Just because audiences are consuming UGC does not mean advertisers will, or should, automatically follow.
YouTube knows the reason for this as well as anyone: sponsor creative is as likely to be placed next to footage of cats doing funny things as images of teenagers throwing kittens into a river. It’s an unnecessary gamble for advertisers.
That’s why YouTube is building out a suite of “safe” channels in which content is professional and controlled. This they can monetise.
Most readers would understand the concept of user-generated content. “Amateur” is a suitable proxy. The definition of “premium” is less straight-forward. Perhaps a reasonable definition is video content and environments brand advertisers are happy to sponsor. Not all professional content is premium in this sense. Graphic, but professionally produced, news footage is not a good fit for many brands. Some UGC content is premium.
YouTube’s example, videographer Natalie Tran, has moved from amateur to professional as she has grown her audience, honed her production chops and taken on sponsors.
In another example, Nine News iPhone app subscribers can submit their UGC footage to the Nine newsroom. If the pictures are newsworthy enough, they get a run in the 6pm TV bulletin. With more than 120,000 downloads in its first 10 days, Nine has added some serious amateur muscle to it professional news machine. If it’s good enough, this UGC will be broadcast alongside the professional material, just as we saw with the Queensland floods and tsunami in Japan. The catalyst turning UGC into premium content is professional editorial curation. Real-life professional editors and producers making editorial decisions on the fly are key differentiators for the bigger news and information publishers against the free-for-all UGC environments.
It is understandable that advertisers are generally willing to pay more to sponsor professional content than they are for UGC. Professional short-form news, sport and entertainment clips will attract higher rates than YouTube’s standard fare. Long-form programming, such as catch-up and catalogue TV shows, is even more valuable to advertisers. The two main drivers for this natural yield curve are environment and user mindset.
Short form users are snacking users. They might arrive at YouTube from a Facebook link and exit soon after. Exposure to pre-roll or display advertising is limited, there might be frequency issues and the content they view may or may not be an appropriate fit for the advertiser’s message.
The next step up the food chain is premium short-form. It’s still snacking content but adheres to a set of professional standards that ensures it is not offensive, graphic or poorly produced. Anything that is unsuitable, plays without ads. These news, entertainment, lifestyle and sport clips are the bread and butter of Ninemsn, Yahoo7, Fairfax and News. At ninemsn, we’ve found users watching video inside articles consume more streams than those viewing in a stand-alone index. Our theory is that audiences in articles are more engaged in the story and more compelled to watch videos that contribute to this story telling.
The undisputed heavyweight champion of video engagement is long-form programming. This allows advertisers to deliver their messages alongside catch-up TV content that the user has consciously sought out and spends more time with. Consumers are more immersed in the content and more likely to return regularly, thus more likely to look upon sponsors favourably. In less than a year, FIXPlay, ninemsn’s long form video destination, has doubled its audience size. Catch-up and catalogue video currently contributes a small but growing percentage of ninemsn’s 20 million monthly streams and a disproportionate amount of time spent.
On the subject of stream numbers, it will be interesting to see what happens to Fairfax’s figures when they turn off auto-play. It is a tough situation they’ve put themselves in. If they had persisted with this tactic, they would have lost UM and perhaps other agencies. When they do put autoplay out of its misery, they will lose more than half their streams, according to the numbers attributed to the tactic when they rolled it out
The key factor here again is environment. After carrying out its own research, UM found 96% of users disliked autoplay and decided this wasn’t an environment conducive to selling a sponsor’s message. UM (a client and supplier of Ninemsn) has not been reactive or petulant in its actions. It did the heavy lifting, going directly to the market for answers. And the market said, in no uncertain terms, that environment matters.
As mobile technologies become more widely dispersed, we can expect to see a greater percentage of UGC in the content mix, particularly in news. This won’t affect the value of the news sponsorships for marketers because news is mostly a curated environment. The trouble for marketers would come if they blithely followed the eyeballs wherever they went. There are some very popular but undesirable destinations on the web.
Audience size is important. More important is getting into the right environment, with the right content mix, to create a strong and lasting relationship with the right audience.
- Andrew Hunter is head of network at NineMSN
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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Great article. Thoughtful consideration to context that seems to be ignored in many other discussions. And it’s about time we saw some real analysis around viewing habits behind many of these videos. Watching a Russian blow his car up on Youtube while scoffing down a pie at the desk for lunch may not be the best time to consume a Bridgestone ad…
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Thanks Andrew — I often wonder at the use of that phrase “catch-up TV”. Does the TV industry really still think of IP TV as “catch-up TV” or even “catalog [ie old] TV”? Or do they simply lack the online rights? And if so will they seek online rights more aggressively and start broadcasting online at the same time? And if they don’t, will global producers one day say bugger it and sell global online rights instead to Facebook (and let Facebook sell the ads — which might make ad rates cheaper and the ads more targetted and more effective?) And if that’s the case what’s the future for local networks?
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Andrew, maybe you should do your own ‘heavy lifting’ and have MSN pay for a study into ad effectiveness (or whatever metrics you wish to use) to help the adverting community better understand how consumers interact with ads on premium platforms (e.g. MSN) vs riskier propositions like You Tube.
My suspicion is that the lower cost of entry will always make the broader networks more efficient, even if you allow for the occasional bit of inappropriate placement.
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All I read was a naked spruik as to why you need to advertise on NineMSN… yawn…
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Never mind the usual biatches, this was fairly well thought out and a good read. What I find innaresting is the use of adblockers- do you or the agencies know when your ads/videos are blocked?
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Didn’t NineMSN and Ch9 show the footage of the kids chucking the cat in the river, or stoneing the swan? Who paid for the pre-rolls and basic TV ads…..Did they care???
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All – thanks for the feedback.
Rob – excellent idea. Stay tuned.
David, an interesting question and theory … Securing extended online rights to premium TV shows is difficult, unless you’re aligned to a free-to-air station (as ninemsn is with Nine) for a catch-up service. The factors at play are myriad but two of the bigger issues are the output deals the major studios have with FTA stations (each of the FTA players is tied to the output of one or more of the major studios), and windowing (whereby content owners seek to maximise revenue through DVD and other digital sales before releasing to IPTV players and then over-the-top streaming providers such as ninemsn.)
IPTV is different to ninemsn’s FIXPlay offering. FIXPlay is streamed over the web. IPTV is delivered in data packets, via the internet, which are reassembled by the device (such as Telstra and Fetch boxes). The web-streamed experience will improve as the NBN rolls out but, for now, you can’t expect the user to sit through as many ads on a web-streamed service as they do on TV. The experiences aren’t yet close enough. Combine that with Facebook’s lower advertising yields and the proposition you’ve outlined is unattractive in the medium term. Also, the content owners make more money dicing the content by territory than they would with a singular global deal. A global web player could pay a fortune up front in the hope of building a business but they’d be taking a serious bath in the meantime.
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Due to a massive work load I was unable to read the entire article above. I work for a company that manafatures like jackets for kittens and other small animals and would like further information on advertising next to the “kitten throwing” video.
Regards,
Mr Meowgi Products
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Hi Andrew,
‘Streaming’ content over the internet functions precisely in the same way as other content sent over the internet. It’s broken into packets, transmitted and reassembled at the client side.
On that technical basis NineMSN’s Fixplay service is IPTV.
The reason it is called ‘streaming’ is because the content can begin playing before the file fully downloads – the opposite of streaming is downloaded video – where you download the entire file before being able to view it. This is due to a difference in how the file is encoded, not a difference in how it is transmitted across a TCP/IP network like the internet.
Refer to http://en.wikipedia.org/wiki/Streaming_media
Technical distinctions aren’t what is important anyway. What is important is the quality of the content.
Cheers,
Craig
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