Over the past few weeks we have seen the explosion of the Online Video “Newfronts.” There have been dozens of presentations from online media outlets large and small looking to capitalize on video advertising money in play this time of year. In the next few weeks we will be heading into traditional television upfront presentations where we will hear about “TV Everywhere” and full episode players online. While the idea of video consumption across screens is certainly not new, this year there seems to be a palpable difference in the emphasis being placed on fluidity of dollars across video outlets.
The traditional “10 foot” (i.e., the typical difference between the couch and living room TV) marketplace is as strong as ever with overall television consumption steady or growing across demographics. The “2 foot” (PC) video experience however, is rapidly grabbing mindshare and represents a rapidly growing opportunity for marketers. A wide range of estimates place year-on-year growth rates in the online video ad space at about +70%, with 2013 estimated to represent over $2 billion in ad revenue.
Some of the traditional television players are beginning to offer inventory fluidity across screens, providing television make-good inventory in online video. Others are providing a single-audience guarantee regardless of the screen utilized. Still others are pushing the envelope into new and emerging areas of social TV, simultaneous TV and online experiences and beyond.
What should we make of all this innovation? Is a video impression online equal to a video impression on television? Should agencies and marketers embrace video fluidity or take a wait and see approach?
While there are no simple answers, there are a number of industry developments that should be considered when thinking about a world of video across screens. There could be no better time for exploration and experimentation.
3MS (Making Measurement Make Sense) & Online GRPs
This has been one of the most comprehensive online industry initiatives ever undertaken. It has been an “ecosystem-wide initiative to propose standards for metrics and advertising “currency” that will enhance evaluation of digital media and facilitate cross-platform comparison for brand marketing.” The 4A’s, the IAB and the ANA have been some of the leading drivers of this initiative. It is precisely the kind of effort required for video across screens to become reality.
There are a number of task forces within 3MS. One introduces the concept of ad “viewability” and our move to a “viewable impression” standard online. Another is focused on ad classification—developing standard nomenclature to describe video and display ad units. Finally, there is a task force that is focused on GRP currency. This currency is defined as “a viewable impression delivered against a target audience” and will be invaluable for agencies and marketers as we look at sight, sound and motion impressions across screens.
Naturally, after agreeing on a currency we need to be able to measure it accurately and without bias. It is still early days in the development of fully transparent and accredited solutions for the measurement of online GRPs, but some viable early stage offerings do exist in the marketplace. Both Nielsen with their OCR (online campaign ratings) product and comScore with their VCE (validated campaign essentials) product are two options today which could be considered in measuring online GRPs.
Simultaneous Television Consumption + Smartphone/Tablet/Laptop
Many recent studies have validated the concept that consumers increasingly are consuming television at the same time that they are using another device in the room. Some reports have the percentage of simultaneous usage as high as 70%. While it is important to note that simultaneous usage does not necessarily equate to simultaneous engagement (i.e., consumption on one screen could have nothing to do with the other), this trend is reaching a level that cannot be ignored by marketers.
This phenomenon is likely to continue and is yet another indication that increasingly video will become borderless. Attention and receptivity will move seamlessly from device to device in near real time. Programmers will need to provide powerful complementary video experiences and marketers will likewise have a tremendous opportunity on this second, third or fourth screen.
No conversation of video fluidity would be complete without the discussion of cost. Pricing for television ad impressions has historically been quite different than online video (premium online video historically being 2-3 times more expensive on a demographic CPM basis). With many marketers comparing the efficiency of one vs. another it is not surprising that online video ad growth has been relatively modest over the past few years. If pricing becomes more favorable to online video, many believe that brand advertising dollars can fuel an explosion in online video advertising over the next several years.
The combination of a new GRP currency fueled by viewable impressions that can be measured is an exciting inflection point in our industry. This, coupled with a potential changes in pricing for online video represents an interesting foundation for video conversations between buyers and sellers. There has never been a better time for innovation and experimentation and we are eager to see the market develop.
As a final note, it is important to recognize that as video assets become fluid across channels, it will become increasingly complex to manage this diversity. A solution for this complexity is Ad-ID. By providing a unique identifier for each advertising asset as that asset travels through the stages of administration and operations, Ad-ID (a joint venture of 4A’s and ANA) enhances measurement across platforms. This is part of work that is being advocated by the Coalition for Innovative Media Measurement’s, Track-Able Asset Cross-platform Identification (TAXI) initiative.
Look for future updates on the 3MS initiative as well as other industry efforts in the online display, video, and measurement arenas.
Thanks goes to UM’s David Cohen, Chair of the 4A’s Digital Marketing Committee, for drafting this bulletin.