The Video Seller Reality

by , Oct 2, 2012, 12:21 PM
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Most sellers and their respective companies seem to be in stark denial of one of digital video advertising's current unfortunate truth. Today’s video buys come from one of three buckets -- premium publishers, networks and exchanges -- but sellers are historically cautious when it comes to defining which bucket they fall in. The sooner the seller side of the business recognizes and embraces their respective bucket, the sooner they will make more meaningful progress within the market.

The central problem is that once a seller is painted one color in the marketplace, it’s hard to get that paint off.  Media sellers can certainly work at changing their market perception, but it is an uphill battle that takes significant time and commitment to succeed. If you are selling video and want to thrive, you should embrace your position inside one of the aforementioned buckets (or in multiple buckets, in the event your company offers a variety of business models).

While it's hard to argue that knee-jerk labeling of this kind is good for digital video, considering the frequency in which new offerings enter the market, agencies and brands lack the time to effectively evaluate all potential media partners. In an effort to offer some consistency and clarification, let’s start by defining the buckets, and identify how video sellers can eliminate unnecessary complexity and continue moving the industry forward.

Premium Publishers

Premium publishers are destination sites that attract high volumes of unique viewers to watch owned and licensed video content. The attention afforded to them by agencies and brands is similar to that given top television networks in most cases, placing them at the core of a brand’s video strategy or making them a “must buy.”

Unfortunately, publishers within this category face significant scale issues. Given the propensity of inventory  to go unsold at a publisher’s established rate thresholds, it is more than likely that some “premium” inventory remains available as part of the next two categories.

Publishers who are not truly “premium” should focus on differentiators like audience capabilities, targeting technology, reach and content quality, and should prove how their inventory sets them apart from the rest.

Networks

The network is a simple carryover from display: companies that pool inventory from a group of sites, providing access to a wider audience, different content categories and improved targeting opportunities. Networks often use advanced technology and targeting algorithms to differentiate themselves. Rather than fight the premium fight, networks should focus on how they can help advertisers reach desired audience at scale.

Buyers group a lot of media sellers in this category, but they are becoming even more discriminatory in deciding which networks get their business. Transparency is now a determining factor for many on the buy side looking for brand safety and quality content. Sellers that disclose site lists and/or content stand a greater chance of winning business. If not, the media company (and calling it that is even a stretch at this point) risks falling into the last category: “exchanges.”

Exchanges

Exchanges enable advertisers to achieve reach and scale across the Web with great efficiency. The rise of real-time bidding has given advertisers access to video impressions on long-tail sites and the ability to name their price.

Exchanges provide a great deal of value when used effectively, but are often perceived as leaders in the proverbial “race to the bottom.” Unless managed effectively, exchanges are seen as selling poor quality inventory at a small markup, with little or no transparency. Warranted or not, exchanges need to fight this market perception and expound on their efficiencies, targeting capability, and scale. There is more room available today for exchanges on media plans, but they are likely not at the crux of a brand’s media strategy.

Obviously, those on the sell side would like the buy side to understand the nuances of the ecosystem. And while there are many places to pin the blame, it doesn’t make sense to argue with the side holding all the buying power. Sellers should embrace their position in the ecosystem and charge their product and technology teams to develop ways to separate themselves from the pack. With so many companies in the space offering similar services, it's imperative for sellers to establish a core value proposition (in a given vertical) to find their way onto far more media plans.

1 comment on "The Video Seller Reality".

  1. Forrads Gump from Stupid Questions Nobody Dares to Ask
    commented on: October 2, 2012 at 7:05 p.m.
    Does the "video" you refer to -as in "video seller"- refer to video INVENTORY, i.e. sold by publishers? ... Apologies if this is obvious, but "video seller" sounded more like a content provider at first sight.

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