The micro-blogging service has been beta testing a new feature, Promoted Video, which allows advertisers to upload and distribute video ads on the platform. Industry insiders believe that Promoted Video will add another layer to Twitter’s ad business.
Twitter has unveiled a beta test of a new Promoted Video feature to expand its ad business.
The new product is an extension of Twitter's Amplify Program, which enables a limited number of media partners - including the NFL, ESPN, and BBC - to deliver video clips on Twitter, usually accompanied by a video ad as a pre-roll or post-roll. The addition of Promoted Video to the platform will allow more brands to upload and distribute branded videos within Twitter's network.
Meanwhile, Promoted Video partners will also be able to access video analytics, including completion percentage, as well as a breakout of organic and paid video views.
"This is a big move for Twitter, as well as for the digital marketing industry in general," says Josh Feuer, co-founder and chief product officer (CPO) of ad-tech company Genesis Media. "Because [now] almost all the big industry players today [have] started inventing and innovating in the video space."
The beta launch of Promoted Video seems to validate eMarketer's prediction that by 2017, digital video advertising will account for 15 percent of the total digital advertising market.
And for Twitter's part, Promoted Video will add more engagement data to the platform's arsenal.
"Although Twitter can already see whether their users are engaging with a particular brand, or reading a particular Tweet, the video opportunity will really give Twitter more engagement data regarding what users are choosing to watch," Feuer notes, explaining that this way, Twitter can court more video advertisers and help them engage with a larger audience.
Twitter seems to be following in Facebook's footsteps, as the latter introduced video ads last year. However, compared to Facebook video ads that run automatically, Twitter's Promoted Videos are priced on a new cost-per-view (CPV) ad buying model, where advertisers will be charged only when users manually play a video.
This pricing model, according to Feuer, can limit the risk of advertisers' spend by ensuring that ads are viewable and user-initiated. But since this fee-charging structure requires users to take further steps to engage with a video ad, it may make it more difficult for Twitter to generate ad revenue.
It's still too early to tell whether Twitter will gain more value out of video ads with the CPV model. However, Twitter says its early tests show that tweets containing native Twitter video are generating better engagement and more video views than before, indicating that advertisers should indeed invest in Promoted Video.
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Yuyu Chen is an Editorial Intern at ClickZ. Her work has appeared in Local East Village, New York Daily News and Brooklyn Chamber of Commerce website. Yuyu received her M.A. in Business and Economic Reporting from New York University in May, 2013.
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