Here's What Fox, NBC and Hulu are Doing with Increased Online Ad LoadsMonday, June 28, 2010, 09:52 AM ET posted by: Will Richmond Get ready to see more ads in TV programs viewed online. Following my exclusive 2 weeks ago about ABC doubling the number of ads in its iPad app, and soon on ABC.com, the same increased ad load is happening with Fox's and NBC's online programs, and in my opinion, likely with Hulu as well. Here's what I've learned: Fox - Fox has begun selling 2 ads per "pod" and when prior 1 ad/pod campaigns expire, this will become the standard according to Bill Bradford, Fox's SVP of Content Strategy. The pods could include one or two 30 second spots or mix in 15 second spots as well. They could even be a single 60 second spot for sole share of voice. I watched a couple episodes of "Glee" online and already found 2 ads/pod in all pods. In addition, to a companion banner, Fox also uses a small "leave-behind" branded bug in the lower right corner of the video window. Bill confirmed the same research ABC's Albert Cheng shared with me, that doubling the ad load doesn't diminish brand recall, engagement or other metrics. NBC - NBC has been quietly selling 2 ads/pod online for the last year-and-a-half according to Peter Naylor, NBCU's SVP of Digital Media Sales, who said that about 30% of its streams now carry 2 ads/pod. Peter broke down its campaign offerings as follows: "owned" (still 1 ad/pod, with advertiser owning all the pods for 100% share of voice), "scaled" (1 ad/pod, but with 2 advertisers sharing placements) and "shared" (2 ads/pod with 2 advertisers maximum sharing the inventory). The "shared" approach is what NBC is emphasizing going forward, with a target of 50% of streams carrying 2 ads/pod by the end of this year (it was just 20% a year ago). Peter said that all of NBC's research shows that the relevant metrics - favorability, recall, purchase intent, etc. - are unaffected by doubling up. I asked Peter whether he could see more than 2 ads/pod at some point and he said NBC would rather see more creativity and interactivity in the ads than push the quantity up further. Hulu - A Hulu spokesperson told me that Hulu doesn't have a set policy on the number of ads per pod, but rather is striving to balance offering the most effective ad platform for advertisers with achieving the best return for its content partners. That includes the right mix of targeting, ad format and the ad load itself. Hulu has gained notice recently for its "ad selector" which allows viewers to choose which ad they want to watch. Beyond advertising, rumors have been rampant that Hulu will be launching a subscription service soon. My bet is that with Hulu's parents ABC, NBC and Fox all doubling their ad loads, it's virtually inevitable that Hulu will as well. (Note, a CBS spokesperson said the company was not yet ready to talk about its ad policy.) When I put my consumer hat on, more ads are of course a bummer. However, with my industry analyst hat on, I think it's absolutely the right thing for the networks to be doing. As I said in the ABC post, it's imperative that the networks try to achieve online economics that are as close to those of on-air as possible. This is important so that networks will be indifferent to whether viewers watch via online sources or on-air. With connected devices like Roku, Xbox, TiVo, and soon Google TV proliferating, it's foolish to try block online consumption in any way. Making their programs as accessible as possible and monetizing them fully is crucial. That makes doubling the ad inventory the right thing to do. What do you think? Post a comment now (no sign-in required). Categories: Advertising, Broadcasters Related Analyses: Tags: 7 Comments posted |
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It's very interesting to watch an industry redevelop itself. I just hope that the ad industry quickly sees the value.
Lawsonreport.info
www.SethDMC.com
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verandadistribution.com
This new "measurement" is a disservice to the industry and in the end does more harm than good.
We all know in relative terms the network standard of 16 minutes per hour of advertising. When Hulu does 3 minutes per hour (or abc.com now 5-6) we understand in relative terms how dramatically less the inventory and potential online revenue is to the networks with the current load (thank you Will for driving this point often).
When a new term emerges "ads per pod"we have no relative history or comparison.
When Hulu announces a future subscription model I get that this has nothing to do with the ability of instream video ads to support online programs it has everything to do with the inability of media management to monetize the opportunity.
@Kenneth Lawson
What is your basis for saying the consumer will "stop using the services". I miss Lost on abc I go to abc.com and are thrilled that I can get it on demand. it's the icing on the cake that I need to watch 1/3 of the commercials.
Will if you feel compelled to define a new term at least put it into perspective so we can see the full glass and how sweet it's going to taste when we fill it to the brim!
rg
http://www.videonuze.com/static.php?page=willrichmond
@Randall - much more analysis to come on what this new concept of "ads per pod" means. Stay tuned.
I don't care either way - I don't watch ads regardless of what platform I'm on. Too annoying.