In On-Demand World, It’s Time For On-Demand Video Advertising

It’s not just a millennial thing anymore. Media users of all ages are accustomed to hit a button and make a choice about when and where they will consume their next bite of media. Whether a YouTube snack or a full, multi-course, Netflix meal, it is the empowering moment of activation that feeds and satisfies the consumer’s hunger for media, as no traditional serving of “appointment” television ever has.

But why must those darn, interrupting video commercials nearly ruin the whole experience? So says an April 2016 Accenture study, as reported by eMarketer. In most global regions, 80% or more of Internet users surveyed agree or strongly agree that “Advertising interruptions while reading text or watching videos are too frequent.” Also, 38% to 55% of users agree or strongly agree that “in the next 12 months I am planning to pay for new solutions to remove advertising interruptions (e.g. paid subscriptions) while reading text or watching videos.”

It’s time to move video advertising out of the middle of the content stream, and right to the front of the interactive content activation experience.  It’s time to put the viewing of advertising in the hands of the user, just as we’ve done for content. It’s time for a gateway unit that commands high CPMs from brand advertisers, is fully viewed and listened to through consumer activation, and allows users to opt out of in-stream interruptions by opting in to an advertiser message.

The upfront trading of consumer attention for content access — as an alternative to pay-per-view (PPV) or the overload of interruptive ads — is the next logical evolution of the ad-supported T/V (television/video) business model.

Requirements
1. A lead-in screen that offers the consumer three interactive choices to access content:
— Micropayment (PPV)
— Regular commercials pre- and mid-roll
— A “one and done” commercial option, where a viewer selects one of three ad “avenues.”
2. Ad-tech platforms and software that manage multiple functions of digital ad delivery, content delivery, transactions, tracking/reporting and billing

Benefits

Advertisers
Buyers are assured of viewability, audibility and accountability up to the level of completed ad views, adding major value to each ad impression.

Since viewers are presented with a “menu” of commercials, choosing one identifies their purchase interest and stage, adding even more value to the gateway ads.

As the on-demand ad data is captured, it allows buyers and sellers to refine targeting and further increase the value for both consumer and advertiser.

Content Providers
Brand advertisers are paying a much higher CPM for this high value, fully completed sight, sound, motion message delivery, allowing content providers to reduce ad clutter and maintain /increase profitability.

Video Content Consumers: Viewers are willing participants, not the aggrieved/annoyed targets of forced “search and destroy” advertising strategies.

Still, without the multitude of interrupting commercials that advertisers pay for now on an opportunity-to-expose basis, wouldn’t total revenues take a beating?

I believe not. No business ever succeeded by rigidly holding onto a worse customer experience when technology brought new and better options (see cell phones vs. land lines for a fairly recent example). And buyers who are CPM “hardliners” will still have plenty of online and long-tail interruptive TV inventory to buy at a discount, further filling the coffers of providers. Finally, the value of each ad message and related behavioral data will rise so significantly, that revenues may well increase in the end.

Positioning this new approach to consumers would be exciting and fun. Imagine as a consumer being offered a “view-per-view (VPV)” or “one and done” option, with the key benefit being one ad or ad pod of reasonable length and no further interruptions to content.

I dedicate this article to Dana Jones, who founded Ultramercial (a former client of mine), and conceived the idea of making the implicit ad contract explicit.

 

This article first appeared August 31, 2016 on Mediapost.com/publications/video-insider.

About John Osborn

John R. Osborn is an ad agency veteran, formerly Senior VP, Group Media Director BBDO/OMD. For 23 years, he led traditional and new media efforts for clients Visa, Bayer, Eli Lilly, DuPont, FedEx, GE, Charles Schwab, Discovery Networks, HBO, Lifetime Networks and more. John is a longtime advocate for and action-taker around emerging media technologies through the emergence of Cable TV (Pillsbury, DuPont - 1980s), Interactive TV and Internet (Visa, US Navy - 1990s) and online, wireless, Wi-Fi access and Advanced Television (Ultramercial - 2000s). In 1994 he won BBDO's agency-wide Founders Award for work reflecting the BBDO ethic of quality, creativity and effort. Most recently he was Director of Business Development at Ultramercial LLC, an emerging media company providing a unique business model for TV, Online, Wireless and Wi-Fi access. - Author of “The Next Business Model for Ad-Supported TV?”, published February 20th, 2009 in Ad Age Mediaworks - Facilitated and trained agency staff and clients in Creative Ideation sessions at BBDO/OMD. - “Integrating Creative Leadership” Certificate from the Creative Problem Solving Institute. - Past President and Interim Executive Director of Creative Education Foundation (CEF). - Grandson of BBDO co-founder, CEF founder, brainstorming and Creative Problem Solving process co-creator Alex Osborn.
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