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InContext / An inside look at the business of digital content

Why premium video is media’s new monetization moonshot

January 17, 2022 | By Ricky Sutton, Founder and CEO – Oovvuu

In May 1961, President John F Kennedy declared that America would put a man on the Moon and return him safely to the Earth and his vision took the world to new heights. Sixty thousand companies in 70 countries invented five million parts and 400,000 of the world’s greatest minds collaborated to achieve a giant leap for mankind. That’s what you call a moonshot. 

There is a rising groundswell that the time is now right for a Media Moonshot: one that recasts the industry to blend trust with technology and a new commercial model that can last. The good news is that for those willing to embrace change, it’s not that hard.

A billion dollar opportunity

I have spent the past 15 years working in premium publisher video. I believe a relevant video in the right place in the right article lifts the quality of reporting, and improves the news experience for readers. This is now being recognized by ad agencies who are increasing spend in this sector.

To measure this, we at Oovvuu have been working with the Tribune Content Agency over the past year to match videos to articles from hundreds from America’s largest publishers. Those articles are read 93 billion times a month. Significantly, our data showed only 7% featured video, even when it was available.

Unfortunately, just 1% of the videos that were embedded were relevant. And, unfortunately, the least relevant videos of all were the most likely to be autoplay and contain low yielding bottom of the funnel programmatic advertising. However, our research showed that putting the contextual videos in priority positions, and making them click to play, was popular with news consumers and advertisers who would pay premium CPMs.

We used journalists, along with our own matching tech, with 100 global wires and broadcasters in the TCA project to ensure the highest levels of contextuality. The evidence was compelling according to Wayne Lown, Vice President of Tribune Content Agency, part of Tribune Publishing.

The Tribune News Service syndicates hundreds of daily articles read by millions and across the most trusted brands from Los Angeles Times, Dallas Morning News, Denver Post, St. Louis Post Dispatch, and Chicago Tribune. 

“We were able to match 86% of articles in the Tribune News Service with relevant video across news, sport, lifestyle and multiple other genres,” Lown said. “It proved relevant video was there and could be simply matched, revealing a major new revenue stream for publishers who get it right.”

A timely solution

Display advertising is in freefall and subscriptions nearing saturation. The good news is that premium video – which fetches $40 CPMs – offers a way to capitalize on billions of page views and reset publishers’ earnings.

Last month, the world’s largest ad agency GroupM released a report that showed global ad spend was predicted to exceed $1 trillion in 2025. Of that, premium video will account for 19.6% of spend in 2022. 

Mark Lollback who served GroupM CEO in Australia and New Zealand before joining Oovvuu believes that “Publishers are perfectly placed as they have massive engaged audiences. And the big global agency groups are openly talking about supporting publishing.”

At the same time, he pointed out that the biggest spending brands are looking for trusted locations for their messaging. Premium publisher video opens a whole new marketing channel for them, but it needs to be done right.

“Publisher video must be click to play, sound on, highly contextual and get premium positions in premium brands. When it does, it taps into users’ attention and delivers the high performance metrics that marketers are demanding,” according to Lollback. 

He recently presented research to the IAB showing publisher video delivered double digit performance boosts compared to YouTube on viewability, completion rates and click throughs. 

Publishers must act now

The benefits to publishers to grow revenue couldn’t be clearer. Unfortunately, 99% of US articles today feature machine-matched autoplay video with low relevance that attracts low yielding programmatic $7 CPMs. However, The TCA trial has proven that relevant video is available for 86% of articles and premium pre-rolls command $40 CPMs when they are click to play, sound on and highly contextual.

Autoplay should now be outmoded by the smart publishers so they can tap into the opportunity to shift ad spend from YouTube back to publishing. That is the Media Moonshot

Undoubtedly, the emergence of large video syndicators, powerful matching technologies and premium advertising support means it will play an increasingly important role in publisher earnings going forward. The good news is that publishers who do this will be poised to meet customer demand for video, increase engagement and performance metrics across their sites and open access to the largest premium advertising budgets on offer.

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