As the media industry looks toward the future in 2017, it is important to keep some lessons from 2016 at the forefront.
1. Money just keeps coming hard with no end in sight.
eMarketer expects U.S. digital video ad spending will see double-digit growth annually through 2020. By contrast, television ad spending will grow much more modestly, at rates ranging from 2.0% to 2.5%. Digital video ad spending will surpass US$10 billion for the first time in 2017.
Not only is there a lot of money available but, if done right, healthy CPMs as well.
2. Viewability is no longer a luxury.
If anything, 2016 was the year of viewability. Even the almighty Facebook came under scrutiny recently for overstating metrics with advertisers.
A study by ad platform Extreme Reach in Q1 of 2016 put average viewability rate for digital video worldwide at 47%. That’s a far cry from the 70% viewability that is now the norm for many agencies; Group M now expects 100% viewability for many of its clients.
Premium CPMs will no longer come your way if your ads are not viewable. Make sure you create an environment where the content is viewable. You will get the benefits.
3. Fake news is your best friend if you are a credible publisher.
The U.S. election put a spotlight on fake news. Fake news, personal blogs, dubious Twitter accounts, or just simple fraudulent content publishers created to generate revenue has been part of the news cycle in a big way since the November 8 election.
The recent U.S. intelligence report highlighting Putin’s efforts to influence the results of the election was a great thing for premium publishers. Established, relevant, and credible media organisations should jump feet first on the opportunity to create and offer the safest environment for advertisers. Not only are they able to demonstrate their ability to reach a real and engaged audience, they can also guarantee any brand an environment operated by news professionals.
4. Great content drives deep engagement.
Your audience wants great quality video. There is no substitute for quality produced content.
A great example of that is in sports. Sports fans want to see the highlights from last night’s game, or they want to see that amazing catch or hit that is trending. A journalist talking in front of a camera after a game will never be a great substitute to the action of the game. Fans want to see that walk-off home run — they don’t want to see somebody just talking about it.
The chart above is quite interesting. Any official rights owner, like SendtoNews, ESPN, or FOX Sports, generates more than 10 views per month per unique visitor. When fans engage with their content, they usually watch more than one clip. Non-rights holders typically do way less per unique visitor because the content is less engaging.
5. Programmatic is key to your success.
In 2016, 60% of all digital video spending was done through programmatic. In order to capture this sizeable opportunity, you need a strong programmatic strategy.
Without any meaningful strategy, by 2018 you will be ignoring almost 75% of potential digital video ad spending.