The inevitable burst of the video bubble

The V-word was on everyone’s lips at our Monetising Media conference earlier this month. Debates raged about production, distribution and of course, monetisation of video, but are the benefits of video really all they’re cracked up to be?

The Media Briefing’s flagship State of the Media Industry Report 2017 (coming soon) highlights the importance of video in media organisations going forward. Respondents placed video as the second highest investment target for 2017 behind data, and is also in the top five for revenue terms.

Is video a fad, distracting publishers from thinking long-term? Or is there genuinely the demand, and more importantly a sustainable future, for our current obsession with it?

The possibilities

There are undoubtedly a myriad of benefits to video, if it’s implemented in a smart way. Ollie Lloyd, the CEO and Founder of Great British Chefs provided an ideal case study for this at our recent Monetising Media conference.

“Video is at the heart of what we do, but it’s not something we do alone,” Ollie explained. “It’s part of a deeply integrated package.”

“We aren’t obsessed by reaching everyone?—?we want to own an audience that have money to spend and are obsessed with food”.

By keeping their community tight and focused, GB Chefs have had success with video so far without having to offer programmatic adverts. Most of their revenue has come from selective partnerships, and this is not an approach that will work for everyone.

Video also has the benefit of an influx of developments. 360° and Virtual Reality has shaken up the traditional format, and has also been embraced by Facebook and YouTube who continue to develop support and keep it mainstream.

Just this week, Snapchat has announced circular video?—?a new format which could be a game-changer for mobile viewability.

The pitfalls

The problem, as with all fads, is that the industry has become so focused on video, it has lost sight of the bigger picture.

Neil Thackray challenged a number of the speakers at the conference. “Is the media industry about to make the same mistakes again?” he asked, after a panel discussion on live video. “They’re jumping on board yet another trend without a clear monetisation strategy.”

Whether publishers can afford to delay joining the video bandwagon is another matter. Timing entry to the market is critical; early joiners to Snapchat Discover have done remarkably well, but newcomers are now struggling to get a foothold in their saturated articles stream.

The obvious monetisation solution for now is advertising, but this is far from being a sustainable strategy. Ad fraud, ad blocking (yes, that affects video!) and completion are just some of the problems which are contributing to theenormous drop in digital ad spend for pre-roll ads, according to one source.

“We need to see more innovation in digital video advertising and pre-roll,” emphasised Heljie Solberg, CEO of VGTV AS at the Monetising Media conference. “Mimicking the style of adverts used on linear TV simply doesn’t work online”.

Facebook is promising support for mid-roll adverts which could offer a lifeline for video monetisation on its platform. But publishers get stuck in exactly the same trap as before, over-reliant on social distribution with their content at the mercy of Silicon Valley’s fickle algorithms.

The other big issue surrounding video is demand, and this comes in two parts.

Firstly, what is the actual level of demand for video? This is a question each organisation must ask themselves, and there are no blanket rules or case studies which will make this successful.

The Telegraph’s Ben Sinden highlighted this when talking about improvements they had made to their own video offerings. “Our research showed us that up to 80% of our audience still prefer reading the news as text,” he explained. “The video must enrich the story, rather than being the core”.

Another point that came up frequently was the necessity to have ‘captioned video’. Figures released earlier this year estimated that up to 85% of Facebook videos are watched with the sound off; something which has huge implications for unprepared publishers and advertisers.

The second part is far more problematic for both video trailblazers and those with a more cautious approach. Viewability fraud has plagued the digital industry for years, starting with advertising and more recently, filtering to videos as the metrics become more important for publishers.

The most recent example is the high-profile case emerging with Facebook, who have admitted to exaggerating video viewing times for over two years.

The rise of mobile viewing has only exacerbated the problem. With no industry standards or any consistency in recording and reporting these metrics, we’re unlikely to see a resolution any time soon.

Mobile devices now make up 51% of video views, and this is estimated to hit a whopping 75% by 2020. As mobile viewing has risen, distribution has become more advanced, with Facebook’s video offering working hard to match YouTube. Throw live video into the mix, and it becomes a thrilling cocktail of opportunities and pitfalls.

However, data restrictions and mobile battery life will hamper the number of videos people can access, and will slow down the explosion in consumption. There are only so many videos a consumer can watch on their way home before their device powers down, or they get landed with a large data bill.

The bottom line

It’s not all doom and gloom for video. The success of it depends entirely on the approach, and the reasoning behind it.

Video is a tool. If there isn’t a problem to be solved with it, it’ll go to waste, draining precious resources along the way. It’s easy to get swept up in the idea that video is ‘the next big thing’, and is somehow the lifeboat on the horizon for a difficult few years in media.

Think about the opportunities video offers. Will you use it to promote your brand? To drive subscriptions? To enhance the offering to your audience? To teach people something new?

Get philosophical with your video strategy, and make it work hard to answer the question: ‘What am I doing here, and what is my purpose?’ Then, when the video bubble eventually bursts, long-term offerings will remain in the place of short-term gimmicks.

Read the original article on The Media Briefing