We appear to be tantalizingly close to a more comprehensive business, delivery and measurement strategy for On Demand. But perhaps not close enough to create an industry standard just yet. The recent B&C On Demand Summit offered insights into what is being done well, what we can do better and what still needs to be accomplished in the On Demand arena.
There is a lot of good news according to experts in the industry. The number of enabled platforms is increasing, the cost of distribution is declining and the window for dynamic ad insertion is shortening. Brands are beginning to integrate with content to offer a seamless viewing experience. Research companies are energetically examining second by second return path data that is being matched to IP data and there is greater flexibility than ever in content creation, delivery and access.
As the conference progressed it became clear that there are some important actions that need to be taken sooner than later - those areas where the On Demand business needs to focus to get to an industry standard. A short video that captures some of these topics is linked to here.
Here are my top ten On Demand issues and next step: Please comment.
Cannibalization – Cannibalization is not inevitable according to Jim Packer from Lionsgate. But there needs to be a careful balancing act for content providers so that content that is available on demand and across platforms does not cannibalize the primary source of the main business, whether linear or in theater, for example.
DAI – The technology is not there yet for more real time insertion. There are still some structural issues to get it closer to almost real time. Thankfully Canoe is focusing all of its energies on addressing DAI.
Transparency – This is primarily a data access issue that is being addressed by Rentrak in partnership with MediaOcean. Agencies will be able to view a transparent transaction report of 60 networks free of charge.
Data merging and measurement – Even though agency software company MediaOcean is beginning to integrate new datasets into its systems (an important step), On Demand data and measurement in general continue to be an area in need of more development. Improvements in data standardization and metrics are being spearheaded via the IAB and the MRC is starting to accredit certain services and methodologies. We need to keep pursuing measurement solutions as a top priority. And let’s not forget the importance of asset identification to facilitate cross platform measurement trackage.
Scale – How do you get to scale with VOD? It seems that issues like content rights and measurement need to be addressed to help create scale.
Agency silos – Some agencies are stratified when it comes to media purchasing so broadcast and cable are separate buying departments from digital. Silo’ing is not an efficient way to maximize the purchase value of VOD. Many agencies, realizing this challenge, are being to break down these silos but there is still work to be done in this area.
Valuation- How do you value VOD? Some think of it as an extension of cable. Agency budgets need to migrate and the disparity of CPMs across platforms needs to be addressed. Mike Bologna of GroupM suggested defining hyper target segments so VOD is not just “more cable inventory”.
Educating clients beyond age and gender – VOD enables hyper niche marketing but clients may still gravitate to the simpler age gender categories. Nick Troiano of BlackArrow noted that from a business perspective CPMs for A18-49 offers a higher CPM but hyper-targeting is more efficient.
Content rights – Let’s face it, rights are expensive. Especially when the content is new and performance is unknown. But without taking the chance of acquiring all the content rights for a program, there is a marketing challenge (brands cannot fully integrate) and a data challenge (the landscape of VOD becomes incomplete for full measurement).
Rate of change – The rate of change seems to be accelerating. Conference s such as those offered by Mediapost and MultiChannel/B&C continue to bring new and innovative ideas to the industry and help executives keep up to date.