Building a Robust Ad Model in the Online Video Space

Msn_video_2 MSN’s video portal launched recently (source: Microsoft)

having only two days ago posted about how the content / conduit model of consumption is evolving, the good people of MSN yesterday visited citadel Vizeum to tell us about their new online video portal, which can be viewed here.

its a new contender in what’s an increasingly crowded market.  just as broadcast channels have grown in number so too has the choice of internet based on-demand channels.

Online_video_market

internet-based online channels (source: Microsoft)

it’s a far cry from the days when YouTube, blinkx and Google were battling with bootlegged Mpegs.  the market has gone mainstream, and in doing so not only have heritage channel brands (BBC, ITV, Guardian etc) entered the fray, but a wealth of premium content has been made available.

Premium_content
premium content (source: Microsoft)

but the key question for both content creators and conduits in this new market  remains – how does the commercial model remain viable?

consumers are proving less and less likely to pay for content – the recent announcement that the New York Times’ pay service TimesSelect has gone free being a case in point – and advertisers (rightly) are increasingly wary of divesting budget into more and more fragmented media channels (or conduits) online.

this is where the MSN video portal feels most accomplished; firstly, not only is the content is of the highest caliber, but it’s seamlessly integrated with a range of advertising spaces, not all of which are the viewing screen itself; on which compulsory ads are viewed in between every few slices of content.  in addition a 300 x 240 display ad pops out from the side, and a 300 x 60 sits permanently below the screen.

two observations.

one, it seems that the more things change the more things stay the same.  the old contract between viewers and advertisers (where viewers tolerate ads to get the bits they want for free) stands.  it turns out the new way of doing things is the old way of doing things; just with new language, different trading models, and – given the proliferation of ‘screens’ – more sophisticated media targeting and selection.

two, your ads sure as hell better be good.  as much as the model stays the same, the TV now has a mouse.  and whilst as long as brands that make entertaining content will add to the overall experience, a response-orientated insurance add will have people navigating away from the site (let alone the screen) faster than you can say brand response.

of course the increasingly-used alternative to all of this is to bypass the model and make the stuff people want, the content.  and again MSN seem have this in hand, talking to – and utilising the experience of – TV production companies about the creation of original content funded by advertisers.
Original_content

TV Production houses working with Microsoft

so if there is an eventual long-term shift in the business model, it’s most likely to be the move of investment to the producers.  interestingly, it could be the Endemols and RDFs of the world that build on their historical income from channels (conduits) with direct income from advertisers and their comms planning agencies.  interesting times.

One response to “Building a Robust Ad Model in the Online Video Space

  1. Video is perhaps one of the most powerful arrows in a marketer’s quiver. Few would argue neither its raw emotive potential nor its nimbleness with telling great linear stories. It requires the right talent, of course, to leverage the medium appropriately. But in the hands of a gifted artist, there’s practically no limit to the power of video as a marketing tool.

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