A Blog by Jonathan Low


Jan 24, 2017

Business Models Designed To Win the Battle For Eyeballs

As consumers become more discerning about the quality of the technology experience and the economic justification, providers need to adapt in order to deliver the optimal product - and protect their financial model. JL

Kyra Steegs comments in Advertising Week:

Even the big boys, like ESPN, are not immune to the ongoing decline in subscriber revenue outpacing the cost of their content. This upheaval is something many are calling “the battle for the eyeballs” and translates into “the battle of the business models”. Content providers need to safeguard their revenue while maintaining the quality of the consumer experience. They need a solution that secures those interests in terms of how it does tech and how it does business.
It’s hardly a secret that today’s TV and video media landscape is undergoing a period of both massive disruption and incredible opportunity. According to Cisco, video will account for 69% of all consumer internet traffic by next year, while Ericsson reports the average US household now pays for 3.8 VOD services (Ericsson Consumer Lab TV & Media Report).
At the same time, broadcasters, OTT providers, cable companies, video platforms and other video content providers are only too aware of the challenges facing their current business models. With all signs pointing to the VOD market reaching saturation point, TVOD, AVOD, FreeVOD, SVOD and hybrid models are all vying as solutions. As a recent article in Business Insider illustrates, even the big boys, like ESPN, are not immune to the phenomenon of the ongoing decline in subscriber revenue outpacing the cost of their content.
This upheaval is something many are calling “the battle for the eyeballs” and to a certain extent that translates into “the battle of the business models”. This is where video content providers can take a hard look at the same technology that has been disrupting their landscape for years – and start using it in their favour as they move to an AVOD or hybrid model. Tapping into the power of programmatic advertising can help content providers not just win, but keep eyeballs.

A big revenue source that won’t disrupt your content

How can programmatic help you win and keep eyeballs? This is not the mass, irritating advertising that most of us grew up with. A programmatic platform knows whose eyes are on the screen, no matter what device they’re pointed at. With the move to OTT and TV everywhere as a video delivery method, the ability of programmatic providers to extrapolate consumer behaviour from data is greater than ever. That means a frictionless ad experience for viewers and the kind of niche targeting potential that advertisers crave. That all adds up to your ability to not just win but keep eyeballs in a quickly shifting marketplace, where programmatic can serve as a vital ally in creating viewer loyalty and engagement.

A programmatic solution that safeguards your revenue interests

However, there are many ways of ‘doing programmatic’ and not all solutions are created equally. Introducing an advertising model means video content providers will need to be sure they are safeguarding their revenue interests while maintaining the quality of the consumer experience. To do that, they’ll need to look for a programmatic solution that secures those interests both in terms of how it does tech and how it does business.
In terms of tech, to gain the highest price per impression, video content providers should make sure they’re choosing a solution that can do two things in the same environment: both serve up any ad impression format and any type of campaign. To be clear, when I talk about impression formats I mean video (both in-stream and out-stream), display, mobile or rich-media formats; and a platform that can serve up any impression format is what is known as full-stack. When I talk about campaign types, I’m talking about how ad space is sold, whether as a direct campaign, guaranteed, RTB, Deal ID or third party.  An all-in-one programmatic solution should be able to weigh pricing agreements, what the market will pay and what type of format is in highest demand for any given ad spot at any given moment, and return the highest price. This is called holistic optimisation and not all platforms can do this. What’s more, if inventory is split among multiple platforms, the opportunity to exploit the best market conditions is ruled out from the start. So, in terms of tech, video content providers should be looking for a solution that’s not just full-stack, but one that’s holistic as well.
Apart from how a programmatic solution does tech, the next crucial step towards safeguarding revenue interests is looking at how a programmatic solution does business, meaning how it does transparency. In the last few years, the programmatic solutions market has exploded with a myriad of providers and promises. As a result, it’s important video content providers select a programmatic technology partner that is both independent and engages in transparent business practices. That means a partner that is clear about how it makes its profits, and consequently is clear about where its interests lie in the market, whether the buy-side, sell-side, or somewhere in-between. Working with a transparent programmatic technology partner means that video content providers can be sure their tech solution is focussed on securing only their revenue interests.
In the end, there’s a lot to consider when it comes to winning the “battle for the eyeballs” and business models. But if video and non-video content providers arm themselves with knowledge, I believe the coming years can see them surging confidently into new video revenue fronts.


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