You don't have to be a sheep and you don't have to accept conditioning. No, it's not a political slogan from a George Orwell novel. It's the theme of Hyundai Motor America's new ad campaign for the 2011 Elantra. The automaker is touting both Elantra and Sonata with four new ads, some of which will run as part of its buy on the Super Bowl. The ads, via Innocean Worldwide Americas, will first air this weekend during the broadcast of the AFC Championship game on Sunday. Also in the two weeks leading up to the Bowl game, the spots will run as unbranded, viral online videos. And print, digital and direct marketing elements will also start before the Super Bowl, during which Hyundai will run three ads. This is the fourth consecutive year in which the Fountain Valley, Calif.-based auto company has advertised during the national Super Bowl broadcast, and the first time it has tied the media buy to a campaign starting during the divisional championships. "Over the years, the Super Bowl has provided a great avenue for us to reach a significant audience, and this year we are expanding that reach by jumpstarting the campaign two weeks early during the AFC Championship game," said John Krafcik, president and CEO, Hyundai Motor America, in a statement. "Having a fully integrated campaign leading up to the Big Game next month will allow us to build a story that makes a dramatic statement." The two Elantra ads, with a "Snap Out of It" theme, suggest that people are driving ugly, unstylish, cramped compact cars because they have been conditioned since birth to accept those constraints. One ad about how roomy the new Elantra is shows home movies of little kids crammed into little toy cars and car-shaped swings, and beds from which their legs protrude. The other spot shows people in an Elantra noticing that all of the other cars around them being driven, literally, by sheep (not gerbils -- that would be Kia Soul's campaign). The company says the Super Bowl campaign will involve a viral campaign using 10 online parody spots that discuss a global "conspiracy" behind "compact car hypnosis." The shorts, like the ads themselves, are shot to look like consumer-generated content. They direct viewers to an unbranded microsite that expands upon the compact car conspiracy. Only on Super Bowl Sunday will Hyundai reveal the truth about the ads, and then it will also launch the other two "Snap Out of It" ads.
San Francisco -- Big video usage numbers continue to come to the digital video industry -- even if things have tapered off a bit. In speaking at the OMMA Video conference in San Francisco, Dan Piech, senior product management analyst of comScore, says the business is now firmly established and mature. After some major growth in 2006, Piech says stats have leveled to 180 million visitors watching videos per month. That comes to 85% of all Internet consumers, 200 videos per person and around 13 hours per month. Key for some major TV networks and their TV shows -- also known as "premium video" -- comScore says there has been a shift of regular TV networks' customers viewing video online on a consistent basis: 4% in 2009, now 8% in 2010. Seventy percent of people say the biggest reason for watching a TV show online is to watch a missed episode. The next reason -- for 57% of Internet customers -- is convenience. In third place, 56% of digital viewers want to see a past episode. Most revealing is the fourth reason. Piech says 42% of people watch online because there are less ads versus on traditional TV. He says the data indicate consumers now want fewer digital ads versus a year ago. In 2010, comScore says consumers' limitations are around five and half minutes to six minutes per episode of a TV show. The year before, consumers would allow around six to seven minutes messaging. Good news for premium TV digital sellers, says Piech, is that the business still delivers on average less than 5 minutes of digital video messaging per episode.
Adconion Media Group plans to announce Thursday the spinoff of the Joost Video Network into a stand-alone business unit. The newly launched digital media company will provide premium branded solutions for advertisers and brand marketers seeking to target audiences with in-stream and in-banner video advertising. Nick Higgins will lead the new unit as executive vice president. He previously held the position of head of global video at Adconion Media Group. Prior to joining Adconion, Higgins was at MSN, where he held several senior positions during the past 10 years. Adconion acquired the assets-digital rights management, video player, and content distribution of Joost from ex-Skype founders in November 2009, and then launched the Joost Video Network in February 2010 across North America, Europe and Australia. Since then, Tyler Moebius, CEO of Adconion Media Group, says the company quadrupled revenue to $30 million and expects to triple digital growth in 2011, making it the largest global video player operating in more than seven countries. Joost is not the top video destination site but was No. 2 early last year in terms of reach, Moebius says, citing comScore. The company serves display ads to more than 400 million viewers monthly. The opportunity to become aggressive and capitalize on the video market led Adconion to spin off the network into a separate business unit. Moebius believes the move will position the company to capture more of the video market. Unlike other pure-play video networks, he says this will allow Adconion to reach across a broader suite of products such as pre-roll, in-banner video, expandable ads, road blocks and custom skins and integrations. Joost also offers branded entertainment services through its partnership with RedLever, a global studio specializing in developing and producing brand-integrated content for the Web. The stand-alone business unit plans to leverage its core strengths in its owned-and-operated site, and non-exclusive and exclusive partnerships. Moebius says Adconion gives advertisers access to premium inventory through exclusive content deals. But the company still has a way to go. Video ads reached 49% of the total U.S. population an average of 36.8 times in November, according to comScore's latest stats. Americans viewed more than 5.4 billion video ads in November, with Hulu generating the highest number of video ad impressions at more than 1.1 billion. Tremor Media Video Network ranked second overall and highest among video advertising networks, with 477 million ad views, followed by adap.tv at 446 million, and Microsoft Sites at 427 million. The plan to hire about 30 employees to support the new division this year will increase the dedicated Joost sales staff to about 80 people. The company basically serves agencies such as Fortune 500 and 1000 companies, those buying video solutions from Hulu, ABC, Microsoft, and portals.
Ad network Rocket Fuel has introduced new video pre-roll units that it promises will leverage the company's variety of targeting methods to deliver high-quality audiences more efficiently than the typical online video campaign. The company's Video Booster solution offers 15- or 30-second pre-rolls with companion display placements. It is also integrated with the video ad network BrightRoll's ad exchange and the Adap.tv Marketplace to provide access to video inventory. Founded by three Yahoo veterans, Rocket Fuel's goal has been to bring "rocket science" to display advertising by combining multiple targeting methods including behavioral, contextual, geographic and demographic to optimize campaigns on the fly for better results. Now the company, whose ad network reaches 150 million people each month across 20,000 sites, is extending that approach to video. "What we're doing is allowing marketers to reach much more exactly the audiences they're trying to reach, and drive them to brand goals from awareness to consideration to purchase," said Rocket Fuel President Richard Frankel. The Video Booster ads incorporates the company's Progressive Optimization technology, which applies data gleaned from billions of ad impressions to inform video ad buys. It identifies users who are responsive to online ads and then targeting video ads to others like them. Frankel added that the cost of running Video Booster units will be in line with current rates for targeted video advertising but will deliver better results. "Plus, we'll be learning a lot about how users engage with ads and sharing that information with clients," he said. Adap.tv and BrightRoll are counting on Rocket Fuel's targeting and optimization capability as a value-add to refine video ad buying through their respective online exchanges. "When you combine the scale of the Marketplace with Video Booster's advanced ability to accurately identify the most relevant users, you give advertisers a powerful way to connect with the right audience and exceed their campaign objectives," said Adap.tv President Toby Gabriner, in a statement. The partnerships with the Adap.tv and BrightRoll provide large volumes of inventory and allow marketers to continue buying video media online, as they are accustomed to with Rocket Fuel's optimization technology added in. "They don't have to change how they're buying advertising and we do all the targeting and optimization on the back end," he said. Redwood Shores, Calif.-based Rocket Fuel last September closed $10 million in a second-round funding led by Nokia Growth Partners and including prior investors Mohr Davidow Ventures and Labrador Ventures. The company has raised a total of $20 million in financing to date.
For the past several months, the online advertising industry has been buzzing about consolidation in the video business. Many of the year-end prediction pieces for 2011 reflected an interest in this topic as well. However, as I learned early in my career as an investment banker, there are two very different types of deals. Any banker can do deals that make money; but it is the great bankers that do deals that really matter. Although I have massive respect for anyone who builds a business and can sell it for millions of dollars, most transactions do not provide long-term value to their respective industries. As we enter the next phase in the evolution of the online video ecosystem, it is important to further the conversation about consolidation and focus on the deals that matter. Deals that matter are those that significantly change market-share dynamics and competitive positioning, and lead to billion dollar businesses. To put this in perspective, let's discuss past deals that fit these criteria. Search Deals In the search industry, there are only two deals that matter. The first was Yahoo's acquisition of Overture, which created a long-term viable competitor to the Google AdWords business and ultimately led to the Yahoo/Microsoft search alliance. The second was Google's acquisition of Applied Semantics, which enabled Google to build the AdSense network. This was Google's second billion-dollar venture and ultimately led to the majority of the inventory on the DoubleClick Ad Exchange (now Google Ad Exchange). No other deals have fundamentally changed the space the way these two have. Others worth noting because they made money for the stakeholders in the acquired companies include Excite/@Home and Yahoo/Inktomi. Display Deals In display, there have only been four deals that really matter. The first was AOL's acquisition of Advertising.com, which created what was, at the time, the largest display ad network in the world by a big margin. Second and third were Yahoo!'s acquisition of BlueLithium and subsequently RightMedia, which led to the creation of the Yahoo Advertising Network and the Yahoo-powered RightMedia Ad Exchange. The fourth was Google's acquisition of Doubleclick, which enabled the launch of the Google Ad Exchange, which is now the largest display advertising business in the world. Deals that didn't matter in display but made a lot of money for the stakeholders involved include AOl/Tacoda, Microsoft/AdECN, Microsoft/Aquantive and WPP/24/7. Mobile Deals In mobile, there have only been two deals that matter. Google bought AdMob, which instantly gave Google more than 50 percent market share in mobile advertising, and laid the foundation for its category domination. Apple bought Quattro Wireless, and although the jury is still out on the value Apple got out of the deal, it served as the catalyst for the company to launch iAd - an important addition to its near-monopoly status in devices and operating systems. As of now, there actually haven't been many inconsequential deals in mobile, but we will have to see the long-term impact of Mobclix/Venti and others before we make a definitive assessment. Video Deals Using our historical perspective on deals that really matter, let's now focus on the video category. Clearly, there has only been one transaction in the video space that is material to the business: the Google/YouTube transaction. This deal will likely go down as one of the single best media acquisitions in history because it provided Google with the foundation to become a global leader in digital video content and advertising for the next decade. It is likely that all other video deals signed thus far will prove to be financially lucrative for the stakeholders involved, but insignificant in the long-term, competitive chess game of major media companies. Until Yahoo!, Microsoft, Viacom, Comcast and the major broadcasters begin to focus real capital in the video category, the consolidation that occurs will be peripheral at best.
Vitamin Water has been getting a lot of emphasis from its parent Coca-Cola. Peggy Loos, director of media and interactive marketing for The Coca-Cola Company, in says Vitamin Water did a faux video where a tough agent wanted money for his sports clients from those fantasy sports leagues -- like Minnesota Vikings's Adrian Peterson. "It provided free entertainment value," says Loos. Additionally, Coke got a bit lift when ESPN picked up the video for its fantasy sports shows. Vitamin Water also sponsored what it calls "Go Shows" -- spontaneous acoustic music concerts at colleges.
Consolidation of video ad networks? It's here and happening. But it is good? A number of panelists at the OMMA Video event in San Francisco - especially those on in the ad network business - believe prices will climb, just like in other businesses -- all because ad networks buying each other creating bigger companies. "We are providing more value than ever before," says Jason Krebs, senior vp and chief media officer for Tremor Media. Cory Treffiletti, president and managing partner for Catalyst S+F, questioned whether the video ad network business has lessened the value of display inventory. Lewis Rothkopf, senior vp of network and exchange of BrightRoll Inc., countered that, "it has been right-sized on the premium sites." Dave Martin, senior vp of media for Ignited says it comes down to two equations -- for display advertising there is more inventory than demand. But for video, the reverse is true -- there is way more demand than inventory.
Your video starts in 30 seconds. So what can one do with that time? Research from a study called "Off the Grid" done by IPG Media Lab and Say Media, said viewers -- especially those who can access on-demand video or at opting out of cable/satellite/IPTV overall -- says a good pedicure could be in order. Video of a viewer during the IPG/Say Media presentation said: "I can trim that finger nail!" Brian Monahan, executive vp and managing director of IPG Media Lab, said: "This is what we heard time and time again. 'My time is valuable.' That's what they are thinking about."
The Internet is still all about short videos -- though the length of videos is getting longer. Not only that but somewhat surprisingly, Mike Dodge, president and general manager of Atomic Online, in speaking at the OMMA Video event in San Francisco, says men are watching longer videos on average than women. December 2010 comScore numbers show that men will watch videos with an average length of 4.9 minutes versus 3.6 minutes for women. This is up from 3.4 minutes for men and 2.9 minutes for women in April 2009. "This is not what we expected," he says. Dodge says research shows men like entertaining, funny, and more adult videos; while women will focus on beauty, cleaning, and cooking. "Women wants advice and tips," says Dodge. "But for men, the last thing you want to give to them is advice."
Digital video networks and video content sites should take heart that one of the key pieces of Comcast-NBC Universal deal was Hulu. To get approval from -- the Federal Communications Commission and the Department of Justice -- Comcast had to relinquish its management input and board of directors seats at Hulu. All that means opportunity. "The NBC-Comcast deal will help [move the industry]," says Matt Wasserlauf, executive vp of video platform and services at Specific Media. Given the Comcast will have to sell its content to all comers, Wasserlauf says, "it will create inventory [to sell]."
Web-to-TV services looking to change the game -- Roku, Boxee, and Google TV, and will be apparent when it comes to the duration of a particular piece of content. Original programming running along side traditional TV won't look the same, from a time perspective -- different lengths of video versus the standard half-hour, hour blocks of programming. In speaking at the OMMA Video event in San Francisco, Jim Louderback, chief executive officer, Revision3, , which produces original web content says: "We are not trying to replace TV. It's as long as it needs to be. We have shows that run three minutes long, and we have shows that are an hour long." Live programming, as well, will feel different to viewers: "Live is only one to two percent our our audience," says Louderback. "But they love you the most." Not only that, but viewers can choose what commercial messaging -- all to get closer to advertisers. Kevin Stephens, Head of Device Partnerships of Boxee: "I can chose an actual experience." What are the hurdles for these companies? Other OMMA Video panelists agree it'll come from the "discovery" of new digital video content.
Peggy Loos, director of media and interactive marketing for The Coca-Cola Company, in speaking, at the OMMA Video conference here in San Francisco, said there are many video messaging executions -- which makes sense considering the diverse number of Coke's brands. "We don't have one approach for video," she says, then showed off a number of Coke bottles and cans. Now Coke uses a array of video platforms/formats -- video syndication, product placement, user-generated videos, and live streaming. "We know the consumption of online video is moving at a rapid rate," she says. "It's not about selling a product; it's selling an experience." Loos then went on to show out its very popular YouTube viral video -- The Coca-Cola Happiness Machine - where people can be seen getting free Cokes, pizza, and other food, all through a vending machine.