Online video is the new upfront. Should you jump in?
Apparently, the online video upfront is the new upfront. Even if you just dabble in online advertising, you're probably hearing from all sides that you should lock in your prime video inventory now, before it's too late. The strategy that's worked for TV for years to drive ad sales has found its way to the Web. In the TV world, depending on your perspective, it's either a fantastic sales strategy or an aggressive media buying game, one that if you don't play, your competitors will.
The whole premise of TV's upfront is that there's finite inventory out there. If you don't buy now, what you want probably won't be available later. Though the upfront has worked for years, its effectiveness for the networks has become somewhat tepid. Audience media consumption is increasingly fragmented, leading to lower primetime ratings for all but the top-rated shows. Suddenly, the valuable 18-34 demographic can be found elsewhere -- and a lot more efficiently.
Enter the online video upfront.
If the 18-34 demographic went anywhere, they're online. All signs point to video viewing rapidly becoming one of the most popular online activities for this audience. The online video ad sales model has finally matured. Not only are there major networks and portals to buy video advertising on, but there are smaller sites, too (think long tail). Sales firms represent this aggregated, vast inventory. When properly managed, expectations can be set in advance and inventory pre-sold, in bulk, in advance, or, if you prefer, up front. It's an efficient way to lock in a discounted rate, rotate in advertising over an extended period, and block out categorical competitors from key inventory.
But is this really the best implementation of an online marketing strategy, or is it merely a cop out, the duplication of a dying model?
The answer is a very scientific, very enthusiastic "it depends."
To paraphrase Jeff Foxworthy, you might be ready for an online upfront if your online advertising consists of :15 and :30 spots that will also air on TV, and you're trying to increase frequency among your target demographic. If the concept of repurposing existing spots works for you, then the upfront works for you. You probably also have a good idea of what your annual or quarterly budgets will be and can plan accordingly. The upfront can be a efficient way to get the most bang for your buck impression-wise, eliminate production costs, and plan around your inventory (rather than be subject to whatever's available).
One might argue an upfront strategy runs converse to some of online advertising's great promises: customization, integration, and creativity. Despite our quest to think outside the box, the upfront puts us right back inside it. Being locked into :15 or :30 preroll inventory is confining enough. What if you plan to create exclusive online ads? What if you're actually considering running something shorter than a :15 spot?
If you crave both media and creative flexibility, you may want to hold off. And if you plan to let the publishers serve all your inventory, an upfront buy with multiple publishers may get messy. You'll have to deliver multiple files and sort through different reporting, received at different intervals, from different publishers. Unless there are key events, such as live sports or event coverage, you can't risk being left out of, it's unlikely not participating in the online video upfront will harm your brand in any way.
There are happy mediums, though. Video-serving vendor Klipmart allows an entire video upfront to be served via its platform, resulting in ease of deployment and conveniently aggregated reporting. This can provide room for creative and analytical flexibility.
For the last few years, more than one eulogy has been written for TV's upfront -- the upfront. Why would online publishers emulate it?
The answer, dear readers, is technology. The promise of contextually targeted delivery, more advanced inventory management systems, more accurate analytics, and the fact online video can be interacted with, make the online upfront just different enough to work for many advertisers.
The upfront isn't for everyone. But in its current state, it's digestible for advertisers who are comfortable with buying TV spots and are ready to take the next step in committing to online inventory.
It's likely that within a year or two, as video ad technology improves, so will advertisers' willingness to experiment and, eventually, to fall in love, with the strategy. It will become more of an option for more different types of advertisers.
Online video's exponential growth is what prevented the online upfront from occurring sooner. Once it reaches an even greater critical mass and inventory is more finite, the strategy will morph from an attractive one to a necessary one.
Until then, take your time. Weigh your options carefully -- while you still can.
Meet Ian at Online Video Advertising Forum in New York City, June 16, 2006.
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Ian Schafer, CEO and founder of Deep Focus, consistently redefines the way entertainment properties are marketed online. Ian founded Deep Focus in 2002 to bring a holistic suite of interactive marketing and promotional solutions to the entertainment industry. The company's clients include America Online, Dimension Films, HBO, MGM, Nickelodeon, Sony/BMG Music, 20th Century Fox, Universal Music Group, and many others. As former VP of New Media at Miramax and Dimension Films, Ian was responsible for their most popular online campaigns. He's been featured as an expert in online entertainment marketing and advertising in numerous media outlets including Variety, The Hollywood Reporter, Advertising Age, and CNN.
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