To keep users on-site, publishers are using algorithms to ensure video relevance
Every digital publisher worth their salt has some form of video on their websites. They may be using existing content, or they could be leaning into user generated content, but the transition from text to video that began a decade back has had a major effect on the entire publisher workforce, from editorial to operational to revenue roles. It’s not stopping. It’s not slowing. Especially in a time of quarantine and rapid social change, the revenue it can drive is more vital to publishers than ever before.
As users spend more and more time consuming video, advertising budgets continue to follow. Publishers who (still) haven’t made a dedicated pivot to video are competing for a smaller percentage of the advertising pie — and it will likely only get smaller in the months to come.
From a level playing field to duopoly domination
While it is true that the revenue video unlocks is a crucial resource that must be captured and optimized, now more than ever it’s also true that leveraging it can be a challenge for digital publishers. It used to be that, if a publisher produced quality content, revenue would follow. Unfortunately, nearly all of that budget is now going to the biggest platforms, specifically Facebook and Google. According to data from MAGNA, In 2006, about 60 percent of ad spend was collected by publishers. Now that number has plummeted to less than 25 percent.
The duopoly has access to millions of user-submitted videos, allowing them to recommend relevant videos on a user-by-user basis, a practice known as discovery. They’re reaping the benefits of video consumption like never before. This is the primary way that the publishing world has changed – from content creation to content discovery.
Not surprisingly, while more advertising budgets are going to online video, Facebook and Google are collecting the vast majority of that spend.
Still, video results can drive publisher success overall — and not only for the biggest players. Even independent publishers that use it wisely can drive revenue. However, effecting a more level playing field takes the right approach, and in the way of evaluating strategy and tactics, the team in charge of video operations under any publisher’s roof should be able to say yes to the following five questions:
1. Is ad ops tapping into all of the video ad inventory available?
Most publishers that use video have a player that shows one specific video that is relevant to a particular article. These publishers are missing out on a different video opportunity, namely a discovery unit. Examples abound on platforms such as YouTube and Facebook, discovery players automatically recommend more content that is relevant to the page’s topic.
If the ad ops team is only monetizing one of these two, then it’s leaving some of the most profitable inventory on the table. Video ad units are the fastest-growing category of digital advertising and are now the dominant form of advertising in most countries. Advertisers spent more than $45 billion on online video ads in 2019. That number is forecast to grow to $61 billion by 2021.
Publishers should turn to their video strategist to understand the best fit is for their pages, whether it be one main player, a discovery unit or both.
2. Will the team’s video strategy keep viewers watching?
According to Primis’s findings, for every video viewed per session there is on average a $7.20 increase in RPM. And so, publishers should focus on what gets users to continue watching their videos: relevancy and quality.
It’s important to match the right playlist to the right article. If the example is an article about Lebron James, it makes sense to recommend a series of videos about the NBA rather than NASCAR or rugby. To recommend multiple relevant videos, publishers need quantity (meaning, a sufficient video library) and technology (i.e., a discovery algorithm).
3. Is the video strategy monetizing the publisher’s video inventory?
A key question is whether the publisher’s video vendors have the right demand partners, and enough of them. It’s important to avoid overcrowding, too: unless the team has implemented a smart SPO process, too many demand partners can be counterproductive.
It’s also important to have the correct pricing strategy, setting different floors for each device, geography, browser, day of the week, vertical and more. This is just the tip of the iceberg regarding granularities that factor into an optimized pricing strategy. All these details matter.
4. Can we trust our video partners to treat our inventory respectfully?
Publishers can’t monetize video without partners. They will almost certainly need to form a relationship with DSPs, tech vendors, syndicators or all of the above.
Publishers must ask how transparent their video partners are and whether they have access to real time data and detailed reporting. While on the topic, they should also ask whether their video partners have committed to brand safety, low latency and GDPR/CCPA compliance.
5. Will the publisher get paid and on time by video partners?
A video strategy can be lucrative, efficient and perfect in nearly every way, but it won’t mean anything if the publisher’s vendors don’t pay up. It’s critical to find out whether vendors are publicly audited and insured against bankruptcies, and to check whether they pay consistently and on time. Oftentimes, publishers are lucky if their tech providers merely delay payments, reneging on their net-30-day commitments. For the less less lucky, they’ll go completely bankrupt and not pay out at all.
The key is to ask the team’s video strategist to confirm that vendors are either large enough that they’re unlikely to fold when challenged economically or backed by a company that is. There has been a move to vendors that are backed by big companies. Vendors such as Freewheel (Comcast), SpotX (RTL) or Primis (Interpublic Group and Universal McCann) can offer similar levels of stability.
Taking back control
The duopoly has been winning for well over a decade, taking the lion’s share of ad spend from the publishers that created the content in the first place. Savvy publishers can break this trend, and video can play a critical role. But first publishers need to make sure their viewers are actually watching, monetize everything they can monetize, and gain ironclad assurances that their vendors will pay them.
It all starts with asking the right questions. The five above will help.