Monetizing Video: The Challenges Of OTT, Distribution

As publishers race to produce video content and compete for an audience hungry for the format, the issue of how to monetize video has come as a challenge. 

On the second day of MediaPost’s Publishing Insider Summit, panelists discussed investing in video production and the fragmentation of over-the-top (OTT) video.

The panelists -- which included moderator Mandy Rusin, general manager of Cracked; Andrew Budkofsky, Chief Revenue Officer of Digital Trends; Russ Ellis, VP and group publisher of Home & Garden Group at Trusted Media Brands; Andrea Mazey, director of online video and partnerships at Bonnier; and Richard Routman, president of Minute Media -- agreed on the general distribution strategy of video content to “be where the eyeballs are,” Mazey said.

“You have to be everywhere. You have to be where audiences are, you have to produce content for every format. Some of it may be snackable size or long-form, but you have to be everywhere,” Budkofsky said.



Mazey said the challenge with distributing content “everywhere” is producing the right formats and styles to fit each platform and its corresponding audience.

While it may be tough to properly monetize content on social platforms, Ellis said he sees social platforms as “tools” to drive audiences back to where they can monetize it.

The problem with OTT, Mazey said, is it is “still so fragmented” and early in the game, making it difficult to see who the “lead players” are in the space. “It’s hard to know who the winners are going to be. While we’re in that place, it’s hard to invest a lot of money into it,” she said.

Mazey said advertisers have been saying for years that OTT "is going to explode," but she has yet to see the evidence.

Russ quipped, “It’s been the year of OTT for the last three years in a row and the year of mobile for the seven years before that.” However, most publishers can’t afford to miss out on the opportunities of investing in OTT, he added, “but at the same time it’s about making the investment measured.”

Ellis said OTT has the opportunity for “high performance and viewability,” and he has experienced “big interest on behalf of brands that  want to be part of this.” One of the challenges of using OTT as an “audience extension platform” is the cost of the video service compared to other video distribution opportunities.

Ellis said this is likely because there is “limited inventory,” so as OTT grows, it will continue to be an area of focus for publishers

Another challenge of OTT is discovery, Rusin said, chiming in to give an example of the sheer number of apps on Roku “How do you build an audience and how do you retain an audience and continue to engage them on that platform? It all comes down to resourcing. You need a team of people to help build and grow these channels,” she said. 

Another big way publishers have been monetizing their video content is through branded sponsorships. Young people “really don’t care about sponsorships… if things are done in a responsible way and a helpful way," Mazey said.

"Younger people are used to seeing those things side by side, used to seeing a review and then a suggestion. Where our mentality historically has been - Oh no, we could never tell them what product to buy, that would be irresponsible," she said, adding, "My younger cousins, they don’t want to watch a pre-roll, but they could care less if someone is trying to sell their own mascara brand and often times, they buy it.”

Pre-roll ads should be shortened to five to 15 seconds at most, Routman said, especially if publishers hope to reach a younger audience.

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