Changing The Channel: Online Video Has A TV Problem

• by Marla Schimke , November 3, 2011

Online video is going to be just like TV. We all hear that at conferences; we all read it in the trades. It has been positioned as a good thing. After all, the creative components of online video open the same emotional and active option that a TV spot does. And it does present new opportunities in terms of scale. It is here, however, that online video reaches the point where TV comparisons are a bad thing. In fact, online video is running headlong into a TV problem. Here's why.

The basic problem with online video has evolved from the initial challenge it faced -- a lack of inventory -- to a more robust set of problems for the marketing channel: targeting and measurement. TV has also struggled with this pairing of obstacles, but don’t compare the two if you want to solve them. Instead, identify the opportunities that exist within online video to overcome the decade-old challenges of TV. More specifically, online video can be targeted against the most relevant customer segments and measured accordingly. Now it’s time for advertisers and online publishers to embrace that.

Let's look at some numbers. A report released in late June by eMarketer predicted a watershed year for online advertising, led by a 52 percent spike in online video. Great. But it begs the question of audience. Research from comScore tells us that in May YouTube took a dominant share of online video with 311 minutes per viewer. Hulu came in at 217 and no one else was even close enough to additionally mention. Advertisers that take a TV approach to YouTube risk having ads served along side bad music video parodies and cats flushing toilets. If you are targeting New Moms and you take a TV approach to Hulu, you might get SNL or you might get Dexter. If you take a targeting approach you’ll be able to identify your audience and get New Moms wherever they go online.

The same comScore report also tells us that networks are dominating online video ads. Direct deals are minimal at this point. Now networks can approach the problem of targeting and measurement. Instead, they pitch themselves on inventory, distribution and efficiency: the old problem. Sure, that's still a good pitch. A better pitch is around audience, audience and, yet, more audience.

Online video is beyond critical mass and must move toward audience targeting to reach its next level. Don't aim at distribution as a general goal. Aim at a segment of the audience. Don't aim at older adults. Aim at adults who are in the market for a mobile phone, mortgage or holiday shopping deals. Advertisers and publishers wouldn't pitch display ads any more through distribution and efficiency alone. There is no need to be that rudimentary and ignore the available technologies for online video either. Don’t solve online video’s problem today with the answers to yesterday’s TV problem.