Howard Diamond

Chief Strategy Officer

Changing the Channel from TV to Digital Video

From Forrester to eMarketer and Ad Age to Brandweek, the topic of the day, week, month, and year is digital video. Now, the question brands are asking themselves is, "How can I get in the game?"

There are many ways for marketers to take advantage of the explosion of both video content and consumption. Some of these include pre-roll commercials, user-generated video, and sponsorship of influencers, also known as “brand-inspired” content. Then, of course, you can go all the way to big budget productions, some of which I will highlight below. In any case, the message is clear; marketers are ramping up investments in digital video in a huge way. In fact, eMarketer predicts that digital video spend will increase by more than $5 billion by 2018. So, let's take a deeper look at what is happening in the market, why, and how brands can capture this opportunity.

Massive Disruption in Behavior


It all starts with the consumer, and from a traditional marketer’s perspective, things are looking a lot different now than even three to five years ago.

  • Cutting the cord. Most households are now consuming some form of television content online. Whether it’s Hulu, Netflix, or some other form of streaming, more than 70% of the coveted 18 to 49 year old demographic is now following suit.
  • DVR and fast forwarding. Raise your virtual hand if you have a DVR. So does 76% of the country. While some of us (like me) sometimes forget we are watching DVR because we are too busy simultaneously watching videos on our phone, the rest of us are fast forwarding through commercials at rates estimated between 60-70 percent, according to the Wall Street Journal.
  • Social media. Many networks, like Facebook, are optimizing the experience to focus on video sharing. Check out this AdWeek article on how video is changing the social media landscape.


Television Isn't the Only Answer


TV spend still dominates as the heaviest invested channel for many brands, but this is changing. Here are a few reasons why:

  • TV is not nearly as targeted as digital. Gross rating points (GRP) and audience data is handy guesswork compared to targeting individuals and households based on massive amounts of user data.
  • TV is expensive both to produce and purchase. Online video is simply a better deal for marketers. The average CPM for the 18-49 year-old demographic in 2013 was $44.11 for TV and just $23.03 for digital in-stream online video ads. Then add in programmatic buying, “influencer” and sharing strategies, and those numbers plummet even further.
  • TV is fleeting. It has a short shelf life.  It also has limited digital/social integration and sharing opportunities when compared with digital video.
  • Viewers don’t relate to the ads.  Commercials and ads, in general, are seen as inauthentic, especially among Millennials.
  • Search trends. Look no further than YouTube to see the shift in behavior, this “video platform” is actually the second largest search engine in the marketplace.

 

The Shift to Entertainment


As we start to uncover the shift in behavior and the opportunity to "hedge" our TV bets with better costs and targeting, what are some of the key strategies that marketers are leveraging? One answer is very clear as Social Media and Video Expert Billy Parisi puts it: “Brands are recognizing that they can produce more relevant and authentic entertainment themselves versus sponsoring someone else's content.” Here are a few brands doing this well:
 

  • Acura - "Comedians in Cars with Coffee" One would hardly even know this series was sponsored by Acura, because of the very subtle messaging in each piece. I recommend getting Jerry Seinfeld for your videos, as well. But seriously, this content is engaging, unique, and it leaves the user wanting more. (I highly recommend the Louis CK and George Costanza episodes).

  • KLM - "Cockpit Tales" This series allows a wide variety of consumers to watch highly skilled, articulate and relaxed pilots through a variety of maneuvers and flight plans - from frequent travelers, to gearheads, to airplane enthusiasts.  It’s a very smart way of bringing customers into the brand, and just like Acura, it has done so without any form of selling or product placement, other than casting employees as the on-screen talent.

 
  • Red Bull - "Crashed Ice" What "best of" content marketing list would be complete without a mention of Red Bull? From sending Felix Baumgartner to the edge of space, to the brand’s annual "Flugtag," Red Bull has absolutely nailed it and has blurred the line between sports and sponsorship. I was in a bar in a ski town recently and they were replaying "Crashed Ice" races from all over the world, which is basically an insane mix of downhill skiing and roller derby on courses that weave through major cities. Add nighttime racing, techno music, and lighting, and the result is absolutely thrilling from a viewer’s perspective.
 

Each of these brands and dozens more are staying true to their value proposition in the marketplace and creating entertainment that speaks to their target audience. If done well, they are even creating demand for additional episodes. While these examples may carry higher price tags, remember that brands spend seven figures to produce television commercials and eight to nine figures to promote them through television.

When done right, digital video, or what Rise has dubbed, "Sponsored Digital Entertainment," can build advocacy and add value to the customer-brand relationship in a way that is authentic and truly opt-in. Dozens of content assets can be spun off and repurposed, and the shelf life for these campaigns can be years as compared to weeks and months of most TV campaigns. And finally, brands are able to leverage rich customer data from this engagement that will enable the production of even more relevant entertainment for their audiences and result in efficient investments in syndication.

If you are wondering about how to get in the game, here are some questions to think about:  What specific awareness and engagement goals have you identified for your brand? Would digital video potentially enable this strategy? What audiences and content are most appropriate and what data can be analyzed to determine this? How and when are your current and potential customers consuming content? Stay tuned for part two – a playbook on how to develop your Sponsored Digital Entertainment strategy.

Interested in learning more about how your brand can benefit from video content or sponsored digital entertainment? Connect with me on Twitter: @hdrise or contact Rise's digital strategy team.

03/17/2015 at 12:00

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