Believe the Hype: Video Monetization is Real

5 Insights about video monetization from Ad Week Europe

Digital video has become the hottest advertising format in the media world. For publishers, this rapid growth has posed a number of crucial questions: “Is video advertising scalable? Can you really stake your business on it? Is it better than display?”

At Advertising Week Europe this past March, JW Player COO Bill Day sat down with three industry leaders to get to the bottom of these important questions at the session “Believe the Hype: Video Monetization Is Real.” Along the way, the panelists discussed their first-hand experiences of how video is driving publisher revenues. Here are five things we learned.

 

1) Video now accounts for 35% of all online ad spending.

After years of anticipation, video advertising is now aligning with the growth in video viewing among consumers.

 

“Any great ad medium sits on top of a huge shift in consumption,” Day said, noting that video now accounts for 35% of all online ad spending.

 

Time Inc. product manager Umar Nadat believes that “video is the future,” which is why the company now publishes video content alongside written articles whenever appropriate. This integrated editorial strategy has helped Time UK achieve 252% year-over-year growth in video revenues.

 

2) In the era of walled gardens, publishers need to diversify.

 

Facebook’s recent algorithm shift has served to remind publishers that there’s lots of money on Facebook and Google, but it’s dangerous to become too dependent on a single third-party  platform.

 

“It’s all about diversification and making sure we’re not foes with those guys, but we’re staying out of being dependent on one point of capture,” said Sherzod Rizaev, global head of commercial ops for the sports publisher Minute Media.

 

As Day put it, “Diversification doesn’t mean abandonment.”

 

3) Publishers need to make their videos easily accessible to users.

The dominance of walled gardens also means that publishers need to be smart about how they monetize videos and engage the visitors they bring in from outside platforms.

 

When Time UK pays to acquire traffic, Nadat says the company makes sure that it’s linking to pages where video content is front-and-center and easy for the user to find.

 

4) Programmatic is now the dominant stream of publisher advertising revenues.

Like many publishers, Minute Media is now selling a majority of its inventory programmatically, with 85% of global ad revenues coming through programmatic channels.

 

Léon Siotis, UK & Southern Europe managing director at the ad-tech platform SpotX, added that terms like “premium programmatic” are no longer necessary because “programmatic is just your sales channel.”

 

5) Header bidding can be good, but not good enough.

Header bidding has increased ad revenue for many publishers, but setup can still be difficult and time-consuming.

 

Time UK added header bidding for video this past summer, and the results have been positive. On Black Friday, the company saw CPMs of up to £50, performance Nadat described as “one of the most insane things ever.”

 

However, Nadat noted that implementation is still “clunky” for video header bidding, a problem that JW Player is overcoming with our new server-side Video Player Bidding solution, in partnership with SpotX.

 

Click here to watch the full video.

Want to learn more about video monetization? Schedule a call with one of our video experts.

 

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JW Player April 2018 Product Release

Monthly update on the latest product improvements and offerings

We are excited to announce that JW Player’s April 2018 product release is now generally available.

Our April release includes a number of new features, as well as beta programs, that enable publishers to:

 

Power growth through video intelligence: Harness data and machine learning to drive improvements in monetization, identify the audiences that are most valuable to your business, and easily configure reporting on your videos and audiences

 

 

 

Deepen audience engagement with your content: With our beta Facebook Publish offering, seamlessly publish videos to Facebook, directly within the JW Platform. Let us know if you want to get early access to our Facebook Publish beta program.

 

 

Enhanced workflows that save you time: Work smarter in the JW Platform, with one-stop access to video content management and analytics.

 

 

To dive deeper into our April 2018 product release, please watch our client webinar, which takes a deeper dive into our enhancements. Additionally, you can read our release notes to get more detailed information on any of the enhancements.

Finally, registration is now open for our May 15 product highlights webinar — please sign up today! 

 

Thanks for your continued support of JW Player.

 

Allyn Horne is the VP of Product Marketing at JW Player.

 

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The Playback

Top headlines and news across the digital video industry, curated each week by JW Player

 

 

  • Advertisers see merits of the Facebook algorithm change (Digiday) “The new Facebook algorithm will filter out clickbait-style promotions (‘Like our product if you think this dog is cute’), which will pressure brands to create more meaningful content over the long term.”


 

 

 

  • French say non to Netflix (Rapid TV News)France is bucking the European subscription video-on-demand (SVOD) upsurge trend with the lowest uptake among the countries surveyed by Ampere Analysis.”

 

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How Facebook’s Changes Could Impact Your Video Strategy

Take control of your video business by engaging viewers on your owned and operated site

Ever since Facebook announced that it would feature more content from users than from brands on the News Feed, the web has been buzzing with commentary and reactions, spanning a gamut from alarm to approval.

At JW Player, our viewpoint is that this is an ongoing trend. Facebook changing algorithms isn’t anything new, and this latest change underscores the need for publishers to prioritize their investment in their owned and operated (O&O) video sites more than ever before.

 

Paid traffic isn’t affected

Facebook is certainly driven by improving user engagement, but as a business it’s also focused on increasing paid referrals and profits ($4.7 billion in Q3, a 46% profit margin). One of the first things to remember here is that this change does not affect paid traffic, which has been steadily climbing as a percentage of referrals in the last few years. This trend means that publishers who build on the Facebook platform assuming a free ride via organic traffic or even at predictable marketing costs will continue to be at risk. Think about how the Google Adwords CPC increased over time. Facebook will be no different.

 

Organic traffic is affected

The Facebook algorithm change will impact organic traffic—the volume of visitors coming to a brand through search. Even in this area, the impact hinges on an important factor: the level of audience engagement. Publishers with low user engagement should see a decrease in organic traffic, while those with high user engagement could stand to gain more organic traffic. The question is How good is good enough? The bar may be raised again in the future.

A brand with high user engagement generates more comments, discussions, and likes—all part of what Mark Zuckerberg calls “meaningful social interactions.”

We aren’t critical of this move by Facebook; they are working to create a better Internet. The impact on publishers who rely on organic traffic is clear though, and it’s something that will only continue as time goes on.

 

Creating engaging content on your O&O is key

This trend begs the question: IF you are going to invest in creating engaging content, why wouldn’t you do that on YOUR site?  When Facebook traffic was largely organic, a publisher could debate the value of building on the Facebook platform versus their O&O. But the latest change continues to make that debate less worthwhile.  

By bringing your audiences back to your O&O, you can build a quality experience that exists outside of social media. This move not only fosters more brand loyalty and fills the gaps that Facebook leaves, but it increasingly leads to better monetization due to avoiding Facebook’s revenue share and improving programmatic video options in the market.

So to sum up: Creating engaging content is crucial. Adapting to Facebook’s changes is crucial. But most of all, bringing engagement back to your O&O site is crucial. A video strategy succeeds best when it’s supported by a strong and independent web presence.

 

Bill Day is the COO of JW Player.

 

Take control of your video business today by scheduling time to talk with one of our video experts.

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