In a move that accelerates the development of an addressable video advertising marketplace, Havas' Adnetik unit this morning announced a deal with online video exchange Adap.tv that will enable marketers to target commercials based on the audiences they want to reach, as opposed to the programming they happen to be watching. The deal, which enables Adnetik to make buys targeting individual users on an impression-by-impression basis, is believed to be the first by a major agency holding company inserting ads into online video programming. Other agency holding companies, especially Interpublic's Cadreon unit, have been racing to extend the shift toward audience-buying from online display ads into video, a move that many see as a precursor to transforming the television advertising marketplace as cable and satellite TV operators create an addressable advertiser infrastructure that will function like the online industry's advertising servers. Adnetik, which was launched in 2008, and incubated by Havas Digital, was one of the first agency-held entities to begin exploiting the concept of individual audience targeting in the rapidly expanding online exchange marketplace. Based on its new deal with Adap.TV, Adnetik claims it can reach upward of 300 million online video users daily. Importantly, Adap.TV's exchange also allows advertisers and agencies to procure those impressions in a so-called "real-time bidding" marketplace based on supply and demand. Media companies worry that real-time bidding markets could commoditize the value of their advertising inventory, especially as the volume of supply rises, but exchanges claim it can work the other way too, driving value up for premium inventory that demand rises for. Adnetik CEO Ed Montes did not address implications for the traditional television advertising marketplace, but he indicates that Adnetik was built to evolve beyond conventional online banner ads, and that online video - including pre-roll and interstitial ads - were always part of its plan. He said the system was "built to scale across multiple channels," and that Adnetik is working on "similar opportunities in additional addressable formats in the future."
Rocketing growth of online video has pushed companies to offer new research measuring tools -- while some executives talk up the need for an industry standard. Kantar Video, a unit of Kantar, believes it has the answer with a new real-time tracking and measurement tool: Videolytics. Key to the new software is its fingerprinting technology, which can track all online video no matter where or how it is distributed. Kantar says it can follow and measure the video, even if it is taken offline, modified and re-posted virally. The new software can optimize syndication across all video sites and devices. Marketers will be able to see the effectiveness of their video ads across specific sites, like YouTube, Hulu, and others, or by specific demographic, psychographic and attitudinal data. The new research tool can connect to Kantar's other online access panels. Videolytics can provide in-video surveys to reach viewers directly and handle social media aggregation and metrics. While many research companies are offering video metrics -- in every shape and size -- many digital marketers and research executives have expressed the need for some sort of "standard" to draw in more business. Still, others believe a variety of research tools is needed to measure a disparate number of digital media platforms and executions. Industry estimates are that the digital video ad business will soar to $1.5 billion by the end of this year -- an almost 50% gain over 2009. More rapid growth is expected, with many predicting digital video ads could soar to over 10 times current levels in five years.
As the market for online video continues to expand, WPP research unit Kantar Video on Wednesday debuted its own online video syndication, tracking, and optimization platform. "With over $1 billion in annual global video marketing spending anticipated to grow globally to $10 billion by 2015, online and mobile video is the fastest-growing ad medium in history," said Eric Salama, CEO of Kantar. Dubbed Videolytics, the platform offers real-time tracking and measurement, including analytics -- demographic, psychographic, and attitudinal -- and visualization tools. It also offers "fingerprinting" technology, which tracks all instances of online video no matter where or how it is distributed -- even if it is taken offline, modified and reposted as it is distributed virally. "This on-demand platform enables efficient and accurate analysis to facilitate better, faster decision-making by marketers and their agencies, content creators and distributors, and media companies," said Bill Lederer, CEO of the New York-based Kantar Video. Videolytics is a Software as a Service, open platform with free trial access for qualified accounts that provides seamless integration with various online and offline tools and services. As such, Kantar Video is presently experimenting with ways to integrate the new platform with various third-party services. The first, Echo Video -- created with tracking services Cymfony and Compete -- combines Videolytics with behavioral and sentiment tracking to provide analysis of viral video impact and returns. The program hopes to differentiate between owned vs. paid vs. earned media contributions, quality assurance on media placements, competitive campaign monitoring, audience and consumption measurement, among other features for marketers.
There are all these buckets we try to sort video consumption into that don't make any sense anymore. Forward-looking financial projections are practically meaningless given the jarring speed by which new electronic devices are flooding the consumer marketplace. Partnerships, formed to target television, seem to be forged overnight. For instance Google, putting its hooks inside the manufacturing arm of Sony, today has a strong partner helping get Google Chrome into the living room. I have to scratch my head as I sit in front of my 27" iMac when I hear industry analysts say consumers don't want to use the Internet on TV. My iMac, for all practical purposes, is a TV! One report stated that consumers don't find value in having their televisions connected to the Internet. This might be true today, but devices first need to get sold and installed prior to consumers getting hooked on an application market. Google, in my opinion, is going to invest heavily in getting the Chrome browser onto nearly every television set, even without the cooperation of the broadcast networks. Typically, when the topic of Internet disruption comes up, there is a lot of doom and gloom around the notion that local broadcasters are going to fall first. There is no denying that the future will be a device- and screen-centric world all pulling data from a cloud. But the definition of a cloud, to me, could be anything -- it isn't limited to the Internet. It could be a cable company's data center, Internet provider, spectrum, or a DBS satellite downlink. Let's not fool ourselves, consumers are sophisticated enough now that they will seek out devices for specific purposes tied to any appropriate cloud. Google TV's roadblock by ABC, CBS, and NBC (who all encrypted their content) makes for great gamesmanship. We all know that devices, including Google TV, are here to support some level of cloud viewership. Those in doubt should visit Best Buy and walk the rows of Internet-enabled devices. The big battles around content ownership across all platforms finally seem to be upon us. For many of the interactive television providers this might be an important catalyst to ignite a long-simmering market. As a byproduct of cloud computing, the long-term value, and purpose, of software has changed dramatically these past couple of years. Today you can get many programs for free or at low cost on the Internet. Consumers are able to bookmark into their browser bar (like Google Chrome) all sorts of free programs -- from Mint.com, Google Apps, Xfinity, Netflix, RunKeeper, to Linked In. These programs, many replacing Microsoft products, have become little silos of information in themselves, with the user's attention focused on a very narrow output per application. I imagine the financial strength of Google AdWords will be weakened by all this cloud-based software over time. These applications probably find little financial reward from adding text ads into their user interfaces. As the application market continues to splinter this can't be good for Google's bread and butter search business. This is why I think Google TV is so important, as it provides Google with access to an untapped major revenue source. No surprise, then, that Nielsen Media Research plans to bring GRPs to Internet measurement. When I think about the biggest challenge facing the TV industry I think about a scene from "Raiders of the Lost Ark." It's where Harrison Ford tries to steal the Golden Idol by swapping it with that bag of sand on that booby-trapped pillar. It's as if that bag of sand represents the technical process of upgrading the "cash registers" (inside the broadcast origination centers) that keep commercial insertions happening and advertiser invoices humming along. The entrenched positions of these billing systems -- which should be upgraded for interactive (lean- forward) technologies -- for me are at the crux of why the industry has so much apprehension moving beyond pure audience ratings. With billings rising across the board for television, "if ain't broke, don't fix it" might be the logical response to delaying critical innovation during this lucrative election season. Google TV, however, needs television content for its future more than TV needs Google. This idea that there is some difference between Internet and multichannel providers is dated. The flare-up among Google and the major three networks proves the battle for content just got real. Everything is up for grabs. May the best user interface win. Those broadcasters (and cablers) that swallow the bitter pill, while times are good, and figure out how to upgrade their billing systems, will be positioned correctly as TV turns toward a "lean forward" mode.