Wednesday, May 13, 2009

2009: The year of Re-Designing the Content Business


The disruptive force of the Internet has finally hit home. A quick look at some trends in this context:

* Newspaper revenues are seriously down (25% in some cases); and magazines and other print media are severely challenged, as well
* Digital music revenues are still going up, overall, but very very very far from enough to stop the free-fall of the recorded music industry, in general (approx 20%, globally, would be my estimate for 2008) *pennies for $$, see below
* DVD sales are declining, worldwide, prices are falling, too - and this will only accelerate next year
* Online video views and audiences are up a lot - but so far pretty much everybody has trouble making any real money with online video

Tuesday, May 05, 2009

Ad survey


Brightroll's Video Advertising Report 2009 on Q1 is released.

Some findings:

* 87% of agency executives plan to spend more of their online advertising budgets on video in 2009
* 71% of survey participants view online video advertising as a complementary medium to television
* A majority of respondents estimates CPM prices to be at their lowest, and 20% thinks the price of pre-roll will drop to half what it is today
* Prices of pre-roll continue to fall (early Q2 data suggests this trend will continue)

BrightRoll's average CPM (cost-per-thousand impressions) numbers from the industry at large confirm the trend:

* Average pre-roll CPM: Q408 vs. Q308 – down 12.5%
* Average pre-roll CPM: Q408 vs. Q407 – down 25.0%
* % of Campaign Revenue from Pre-roll: Q109 (80.6%), Q108 (63.1%)

The drop in CPM pricing "could be a good thing," because cost may have been limiting growth, TechCrunch observed. If they come down further, say to $7-9 instead of $20, they'll give TV commercials, which range between $15 (primetime) to $50 (niche, targeted cable channels).

In addition to cost (27%), 31% of agencies cited "lack of targeting capabilities" as a factor limiting online video ad growth. Some 18% said online video has limited reach, and 12% cited ad format limitations. Just 7% thought it was held back by poor inventory quality.

Both pre-roll and in-banner ads were regarded as preferable units, with one out of two respondents saying their use of one or the other depended on the situation and advertiser goals. Reasons for their preference, according to the survey, are guaranteed impressions, overall engagement, and noticeability.

The most surprising finding of the survey was the lack of data and effort around video advertising efficacy; 87% have not performed any in-house research around their online video campaign efficacy.

Asked what they would want to know if they were to conduct research:

* 39% would explore the impact of online video advertising on offline purchase behavior
* 36% would explore changes in purchase intent / brand lift
* 25% would measure efficacy vs. television advertising