SoftKinetic + Intel:
January 30, 2012
November 1, 2009
October 16, 2009
Online video trends
From VentureBeat’s interview with Jeremy Allier, CEO of BrightCove.
How do you see online video ads changing in the next three to five years? Will we continue to see pre-roll and interstitial ads or more aggressive overlays like YouTube introduced this year?
When you look at online video advertising, marketers are just trying to re-use what worked offline. I think we’re going to see more hybrid video ads that offer experiences and ask users to engage. When ABC launched their catch-up TV services on ABC.com, they started introducing a really compelling format that used Flash to take-over the entire player environment with a rich, engaging and interactive marketing experience. In that kind of model, it is invitational, and the creative opportunities are pretty limitless. However, for media buyers, this is going to involve a lot more custom creative work, so it’s hard for such a format to gain scale.
Right now, pre-roll ads are so prevalent. You can measure it. There are no new assets required to produce them. But we think that as more hybrid experiences catch on, it will lead to standardization and economies of scale.
What are the biggest questions you’re asking yourself about online video at the moment?
There’s a big question as to whether meaningful, over-the-top distribution opportunities in video will emerge. What I mean by that is people are getting access to live, high quality, on-demand video without being dependent on traditional cable, satellite or telecom companies. There’s also convergence. There’s a sufficient volume of premium content coming online and speeds are high enough for HD streaming video. Media buyers are changing their behavior.
So the question is whether these new consumer products from Cisco, Microsoft and Apple that people are turning to instead of satellite and cable will be easily and openly connected to the Internet. Will they be as open as the web? And if that happens, there will be a huge amount of activity that gets funneled toward these outlets.
A second question for me is about measurement. Display and search marketing are incredibly measurement driven. Will there be the same kinds of metrics for video –
statistics that show whether video increases conversions, drives greater customer retention and loyalty, and by how much? We need to same rigor and science of measurement in digital video that we’ve seen from other areas of digital marketing.
Online video advertising is a wide open unsolved opportunity. One of the things that is surprising to me is that Google doesn’t have a preroll/interstitial ad solution for online videos. Such a solution should be part of its adsense program.
August 20, 2009
Videos in print magazine?
Yes, you heard it right. BBC reports that Entertainment Weekly will carry video ads in select copies.
Magazine publishers are beginning to experiment with new technologies
The first-ever video advertisement will be published in a traditional paper magazine in September.
The video-in-print ads will appear in select copies of the US show business title Entertainment Weekly.
The slim-line screens - around the size of a mobile phone display - also have rechargeable batteries.
The chip technology used to store the video - described as similar to that used in singing greeting cards - is activated when the page is turned.
Each chip can hold up to 40 minutes of video.
The first clips will preview programmes from US TV network CBS and show adverts by the drinks company Pepsi.
They will appear in 18 September editions of the magazine distributed in Los Angeles and New York.
It’s believed the new technology will cost much more than normal print ads.
August 13, 2009
Automating search marketing
Google wants to automate search marketing by looking beyond keywords. As the term adwords indicates it is based on the concept of keywords. An advertiser has to bid on a set of keywords that closely match what their customers type in the search box. But there are potential advertisers such as plumbers, handyment etc that do not know what a keyword is or how to go about using adwords. Google wants to tap into those type of advertisers by offering a system that doesn’t need bidding on keywords.
“Keywords work very, very well, but we think we can do better,” Nicholas Fox, the business product management director for Google AdWords, said in an afternoon keynote here today at the Search Engine Strategies conference. Fox said Google (NASDAQ: GOOG) was investing in approaches that wouldn’t require keywords.
“It’s hard to say how that will work out, but we’re doing continued investment and research,” he said, adding that there’s a huge opportunity for Google, its partners and competitors to “revolutionize search.”
“Imagine if I’m a plumber in San Jose and I fix sinks and toilets, and Google could automatically match you to the users you’re looking for,” Fox said.
He gave another example of an electronics Web site. “What if I could just point Google to my site and have it crawl the site and automatically build targeted ads matched to queries?”
Fox gave no timetable or indication of how far along Google might be in presenting such a system.
It makes sense though it remains to be seen how well such a system can work.
June 29, 2009
Yahoo kills video ad platform Maven
Techcrunch reports:
At the beginning of last year, Yahoo made a fairly large acquisition with the purchase of online video distribution and advertising platform provider Maven Networks. Under the terms of the agreement, which we reported as a rumor the same day the papers were signed, the company acquired the startup for approximately $160 million. At the time, the press release touted the acquisition to lead to an expansion of the “state-of-the-art consumer video and advertising experiences on Yahoo.com and Yahoo’s network of leading premium video publishers across the web”.
Now we’ve learned Yahoo is going to kill Maven Networks instead, the most recent in a long series of deadpooling of products and services by the Sunnyvale Internet behemoth. A tipster, who works for a large media company, tells us that he has been a Maven customer for years and was informed last week that Yahoo will cease all development on the platform and will no longer be supporting it in 2010.
We’ve confirmed with another source that Yahoo has effectively decided to shelve Maven, firing most of its employees in a move packaged as a restructuring and has already notified customers that the product will no longer be supported as of next year. Furthermore, the source tells us that the Maven technology has never even been used for Yahoo’s own video properties, underscoring why the quote I lifted from the press release in the first paragraph of this post sounds so void today.
There’s always the possibility that the platform will eventually live on under different ownership of course, but rest assured that competitors like Brightcove, Ooyala and KIT Digital are currently celebrating over the news.
This is the third video property Yahoo has killed off in less than 8 months, after shutting both Y!Live, a live video streaming service, and Jumpcut, an online video editing tool. Remarkably, Yahoo CEO Carol Bartz recently declared on stage at a conference that the company is actually still interested in acquiring startups in the business of digital video technology.
May 31, 2009
Advertise, measure and revise
NYT has an excellent post on how web advertising is transforming market analysis.
Darren Herman, left, and Barry Lowenthal are among those bringing Wall Street-like analysis to Madison Avenue. Wall Street-style data analysis is gaining importance in the advertising industry, a business that was once all about a catchy tagline or an arresting image
ON a recent Thursday, Darren Herman, the president of Varick Media Management, was sequestered in his SoHo office. He wasn’t scrutinizing a television ad or images from a photo shoot. He was combing through graphs and Excel spreadsheets.
Mr. Herman had run 27 ads on the Web for his client Vespa, the scooter company. Some were rectangular, some square. And the text varied: One tagline said, “Smart looks. Smarter purchase,” and displayed a $0 down, 0 percent interest offer. Another read, “Pure fun. And function,” and promoted a free T-shirt.
Vespa’s goal was to find out whether a financial offer would attract customers, and Mr. Herman’s data concluded that it did. The $0 down offer attracted 71 percent more responses from one group of Web surfers than the average of all the Vespa ads, while the T-shirt offer drew 29 percent fewer. And Mr. Herman didn’t just compare the messages in the ads — he also looked at the sites where they ran, when they ran and what groups of people responded.
From the “Mad Men” era until now, advertising has been about a catchy tagline, an arresting image, the Big Idea. But Mr. Herman and his competitors are bringing some Wall Street-like analysis to Madison Avenue, exploiting the huge amounts of data produced by the Internet to adjust strategy almost instantly.
“It’s putting numbers to an industry that never had numbers before,” says Mr. Herman, 27, who started and sold three media and technology companies before founding Varick last summer. “It’s nice to be able to tell your brand manager or the chief marketing officer which audience is interacting with the unit, what time of day, what day of the week, and what the response is on certain types of offers. Before, nobody could really tell you that.”
This approach turns marketing “upside down,” says Ron Proleika, the vice president of marketing communications at Windstream Communications, an Internet service provider and a client of Mr. Herman’s. “It forces marketers to stay on their toes and think of thousands of small great ideas instead of one great big one.”
Major advertising holding companies like WPP, the Publicis Groupe, Havas, MDC Partners and the Interpublic Group are starting data practices, hoping to latch onto what is expected to be the fastest-growing category of online advertising in the next five years.
Where the data guys were once an afterthought in a marketing presentation, now they are at the core of the online strategy. What’s more, they can help advertisers save money in traditional media by testing different phrases or images online to see what works before producing an expensive television commercial or magazine ad. Who attracts more clicks in a grape juice ad, for example — the blond girl or the brown-haired boy?
The shift to data-based campaigns is forcing marketers to learn new skills and drawing a new breed of worker to Madison Avenue. While most data executives now in the field came from media backgrounds, they are recruiting Wall Street math geniuses because the job requires hourly adjustments in strategy based on numbers.
Mr. Herman is trying to hire people from Citigroup and Bank of America, and he hopes that the layoffs in the financial industry will help him do it on the cheap.
“It mirrors the financial markets in many ways,” he says, so “that’s where we go.”
May 25, 2009
To be (free) or not to be (free)
NYT has a post on web startups looking beyond ad based revenue models.
OpenTable, led by Jeff Jordan, center, went public last week, rare among young Web companies.
SAN FRANCISCO — For anyone with a crazy idea for a Web business, the way to make it pay was once obvious: get a lot of visitors and sell ads. Since 2004, venture investors have put $5.1 billion into 828 Web start-up companies, and most of them are supported by ads, according to the National Venture Capital Association.
Now advertisers have cut back their online spending. So Web start-ups are searching for new ways to make money, like selling real, or virtual, goods or asking customers to buy subscriptions.
And venture capitalists who envision a sale of the company in the public markets are encouraging these efforts. Roger Lee, a partner at Battery Ventures who invests in digital media start-ups, said he considers only companies with one or two revenue streams in addition to advertising.
“Current troubles in the advertising economy are forcing people, out of necessity, to ask really hard questions about how do I build a profitable business,” he said.
The latest example they can point to is OpenTable, a restaurant reservation site that makes money selling its software to restaurants and charging them $1 for each diner seated. Last week it became the first venture-backed Web company to go public in two years.
It was a very successful offering. The stock was offered at $20 on Thursday, 43 percent higher than investment bankers’ original price estimates. It closed Friday at $28.71, a 44 percent gain.
Others are learning the lesson. When Ben Elowitz formed Wetpaint in 2005, it was intended to let anyone create a Web site free. The venture capitalists he talked to said Wetpaint should get as many visitors to the sites as possible so it could offer advertisers a big audience.
Wetpaint typically offers advertisers space on a few Web sites with a few hundred thousand visitors. But last fall, many of their advertisers raised their sights to publishers with more than five million readers, Mr. Elowitz said. Rates for leftover ad space fell to 25 cents per thousand views from $1.
Some tense board meetings followed. “Toward the end of the year, we came around to say we’re not going to depend on one revenue line,” he said. “The online advertising market looked like it would be the biggest star on the landscape, and even that star has dimmed.”
Now, Wetpaint charges its big company customers, like HBO and Fox, a fee in exchange for providing extra services like site promotion and moderating reader forums.
Smaller customers can pay to keep their sites free of ads. Wetpaint plans to add more paid services, including additional storage for big files and personalized domain names. It is also considering selling virtual goods on its sites.
The market consultants at eMarketer say that while ad growth online has slowed from its 20 percent to 30 percent growth rates, it still grew 10.6 percent last year and is expected to expand 4.5 percent this year. And while advertisers are expected to spend less on display, classified and e-mail ads, they will spend more on search and video ads.
Some technology investors say there is no reason to panic. “Pre-October, most business plans were ad-based models, and all of a sudden the entire world decided they were virtual goods or subscription models, and I just find those overreactions crazy,” said David Sze, a partner at Greylock Partners who has invested in ad-supported sites like Facebook and Digg. “Sure, the ad industry will shrink, but I believe you will see continued growth in ad dollars going to the Internet over time.”
New companies, however, can find it hard to attract tens of millions of visitors, as Facebook and Digg have. And without them, the advertisers may not follow.
Pandora, an online radio site, tried subscriptions when it started in 2005.
“That lasted all of three weeks,” said Tim Westergren, Pandora’s founder. “It was pretty clear there was no future in that and the only real option was to go free.” Pandora now has 10 million listeners a month and advertisers like Hewlett-Packard and Best Buy.
Ads are not enough, though. Last week, Pandora began an optional subscription service. For $3 a month, listeners see and hear no ads and receive a desktop application and faster streaming.
“This is the ultimate debate: What is the nexus of what users want and what the economics will allow?” Mr. Westergren said. “Certain services offered too much and couldn’t afford it, and others charged too much for features people weren’t willing to pay for. There has to be a middle ground, and we’re still looking for it.”
Pandora’s new model, which is often called “freemium” — a mix of free and premium — is becoming the most popular among Web start-ups.
Xobni, which makes a tool that simplifies searching in Outlook e-mail, is free but plans to unveil premium paid versions this summer that offer more features. Xobni does not run ads.
“Ads are an inefficient business model, making indirect revenue as a result of behavior and advertising to people who don’t want to see them or for whom they’re irrelevant,” said Jeff Bonforte, Xobni’s chief executive. “Premium is a very direct and efficient model.”
May 22, 2009
Classified Ads
Pew research publishes the numbers on the declining newspaper classified ad revenues thanks to increasing online classified spend.
(Credit: Pew Research Center)
It’s tough to compete with free.
The use of online classifieds sites, such as Craigslist, has more than doubled in the past four years, according to a study published Friday by the Pew Research Center. At the same time that Web classifies are on the rise, the classifieds business that newspapers once depended on has collapsed, the Pew Internet & America Life Project found.
“Nearly half (49 percent) of Internet users say they have ever used online classified sites,” the Pew Center said in the report. In 2005, the percentage was 22 percent.
One out of 10 Internet users visits an online classifieds service each day, up from four percent in 2005.
Not that this is big news but the Pew Center helps to illustrate just how devastating online classifieds has been on newspapers. A graph of newspaper classified ad revenue since 1980 to last year (at bottom) shows that the industry saw a high in 2000 with about $19.6 billion. Last year, newspapers recorded $9.9 billion.
That’s a plunge in revenue of about 49 percent.
There’s no question either that Craigslist dominates Web classifieds.
“In the world of online classified advertising, Craigslist is by far the most used Web site in the United States,” Pew said in the report. “In March 2009, classified sites averaged 53.8 million unique visitors, up 7 percent from February. Craigslist had 42.2 million unique visitors in the month of March.”
May 12, 2009
Madison avenue takes to iphone
Iphone is growing increasingly popular as an brand advertising medium.
There are two new reports this week about how to use Apple’s (AAPL) App Store as a marketing medium.
The first, in today’s Wall Street Journal, cites several success stories, including Zippo’s virtual lighter and Lions Gate’s (LGF) Stun-O-Matic. The second, a Forrester Research report, warns would-be iPhone marketers about some of the pitfalls.
The two reports agree about one thing: Madison Avenue has latched onto what it believes is a hot new medium. The total addressable market for branded apps, according to Apple, is more than 37 million iPhones and iPod touches — a number that’s apparently getting too large for brand managers to ignore.
“A mobile application frenzy has seized the wireless industry and has even spread to brands not normally associated with mobile,” writes Forrester’s Neil Strother in a paper entitled “Is An iPhone App Right For You?”
The Journal’s answer to that question is a resounding “Yes!” According to Yukari Iwatani Kane’s piece, the apps cost as little as $12,000 to develop and can yield huge rewards in terms of brand awareness. Zippo’s virtual lighter app (flick the iPhone to light the flame) has been downloaded more than 3 million times and waved at countless rock concert finales. Lion Gate’s Stun-O-Matic, a promo for its new action movie “Crank: High Voltage,” yielded 2 million downloads and generated 800,000 trailer views.
In a related news, Medialets, an iphone ad network, raised $4M VC funding. This is not so surprising. Sandhill road has taken to the iphone long time ago.