Measurement, comprehension & relevance… key challenges for Internet revenue model

Measurement, comprehension & relevance… key challenges for Internet revenue model

Author | Noor Fathima Warsia | Thursday, Apr 15,2010 8:59 AM

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Measurement, comprehension & relevance… key challenges for Internet revenue model

Video advertising was touted as an area that was likely to drive Internet growth and allow revenues to come in for the medium. However, as video advertising is not taking off, experts at MipTV look at what are some of the ways in which Internet advertising per se can be made relevant, and the role that video advertising plays in that. Martin Blakstad, Independent Media Consultant, who was moderating the session, noted that video advertising on the internet was still relying n pre roll, mid roll and post roll. He said, “That is not an effective model, and we now know that this won’t work.”

Matias Alpert, CEO, EMEA, Neo@Ogilvy, Spain, admitted that media agencies were not doing enough to understand the dynamics of Internet advertising. He observed, “Audience fragmentation is making things complex, and we are not doing enough to solve this complexity. There are instances when we are in a meeting with client, and we are both not speaking the same language. The process has to change from the start – the briefing process has to be more open minded, prep has to become a part of the process and more people should be involved.”

Nick Bell, Co-Founder, Quick.tv, UK added that pre-roll and post-roll still had a large part to play in the general ecosystem, but there was a lot more that was being integrated in the content. He also spoke of text based advertising, which had worked for companies like Google. He noted, “At present, we should also see how we can turn video-on-demand into an experience that consumer can interact with.”

Video-on-demand is making sense for ITV as well. Ben McOwen Wilson, Director of Interactive & Online, ITV, divulged that the company was making more per hour revenues online than it was on ITV1, which is a large television player in the UK market. He said, “From a consumer's and content production’s viewpoint, we are in a good place. Online has to be complimentary to TV, and we have to understand this. If you are looking to create an aura around your brand, TV is still the medium. Online video can never get you 19.6 million viewers at the same time. There is an impact to that but that is not going to be enough, and that is why internet has to take the proposition forward. People should sees the ad and then engage with it. Google tried many things on this, but none of that has worked. It is the time to innovate. We saw 60 per cent revenue growth in internet display advertising in 2009. We make sure that we are delivering differential value with our online offering, and that has worked.”

Of Measurement, Relevance & New Models

Eric Clemenceau, SVP, International Client, Specific Media, Europe observed that new models were already coming in place. There was once a time when advertisers had to look for interactive agencies to handle that side of the business but today, leading advertising agencies brought all capabilities under the same roof. He added, “Fragmentation is not an issue when you have the right tools. In online advertising, it is not just about the right demographic but also the right geographic. The form of advertising you do on the internet is very important but the data behind it is also very important.”

Nick Wiggin, Head of Advertising Strategy and Partnerships, Ericsson, UK spoke on the company’s initiatives in this direction, called Ad Market. The objective of this initiative was to build the advertising market, and to get reach and relevance in digital and traditional world. He said, “We know how to handle the information, and leverage relationships that we have with network operators to help them come together to form a business model that is essentially providing a central destination for advertising. The industry moved away from ‘last click’ but people are looking for some kind of a standard model to work with.”

Alpert said that while the industry has moved away from the ‘last click’ conversations, measurement was still a problem. He said, “There is a lot of talk on measurement, and it sounds logical. But it is one thing to put it in paper and quite another to put it in practice. It is very difficult to create a measurement model that we can implement. We have moved away from last click already, and we have explained to clients that other things matter more like awareness and brand image but we have to

Wilson pointed out that everyone was expecting the online giants to drive the growth in video online and that has not happened. He said that it was the fraternity’s responsibility just as it was an opportunity. If he industry didn’t innovate now, it would be missing out on various things including display business models. The panel agreed that internet would have to spend more money on content. At present, the content seen was still mainly user generated content, or content developed for television. One of the lessons you internet had to learn from the mobile space was to respect the end user.

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