Much has been commented on the subject of online video. While still a nascent part of digital ad spend, the channel has still been tipped to help deliver sustained growth to the industry as a whole. But the industry is still waiting on the great TV spend migration. The truth is, online video still very much plays second fiddle to TV (in fact it probably accounts for around 1 – 2% of TV spend). So despite the investments and innovation being made in the channel, we are still seeing relatively little change in the current spending trends – especially when you consider how much of an advertiser's budget and interest TV still commands.
You can’t deny the industry has not been working hard to increase the flow of TV budgets.
Agencies bring video buying under a TV team’s remit
A very early ploy to align video closer to TV was to physically bring agency buying teams closer together. If the TV planner buyers were also buying video then surely more money would flow across? That has not necessarily happened.
Incremental Reach studies
Many argue that unless the incremental reach of a video campaign can be determined then it is going to struggle to increase “investment” in video. This again is evidence that video plays by TV’s rules. Why wouldn’t you lead with a large scale video campaign and assess the incremental reach of a TV spot?
Regardless of this situation, the likes of Tremor and Nielsen have still invested heavily in studies to show this incremental reach. It is doubtful whether it delivers enough credibility to convinces advertisers of the effectiveness of video.
The introduction of GRP metrics
The likes of TubeMogul went one step further and started to display performance that were aligned with GRP metrics. This is a fairly shrewd move but again it is doubtful whether it’s enough to convince an advertiser moving out of the branded content and environments they trust into longer tail RTB inventory. It also feels a like a dilution of the medium’s potential – and rather than speaking in a new data-driven language, reverting to traditional dialogue is seen as an easier bet.
It still feels like video is stuttering and agencies have to take some responsibility for the situation. For too long agencies (some not all) have been the “yes” men with regards to “investment” decisions around video.
It has been too easy to replicate a TV spot schedule and buy it online. The advertiser understands the programming and despite not getting any form of joined up measurement (FYI: TV-to-Online is still incompatible) it has been the path of least resistance in getting some incremental spend. In the agency's defence, they initially did not have many other options around video. This unfortunately has created a legacy which now threatens the ability to scale the video channel.
An environment has been created where broadcaster content represents perhaps circa 80% of Video investment – while perhaps only accounting for circa 20% of the overall pool of video supply. When you also consider recent reports from Comscore suggesting that the size of the video audience is not increasing, you have to worry how video ad spend will increase. If broadcast content still dominates share of budget and the amount of users watching videos isn’t increasing then two things must happen to ramp-up spend: increase frequency or increase pricing.
If too much power resides with the major broadcasters in the video market, then you have to look to the agencies who have put them in that powerful position. Agency trading deals have and continue to threaten any innovation in the industry. If a major agency network commits to a certain amount of spend for the year (of which video volumes are also rolled up into) then where is the onus to drive greater innovation? However, we must not forget that these trading deals are only in place because advertisers want to be in and around those programmes, and want to ensure their commitments generate the lowest possible price.
The current situation isn’t helping the growth of online video – and despite the prediction of a convergence in the two markets we are likely to see the trend of “investment” disparity continuing between TV and online video.