Sony’s Crackle Site to Bolster Video Offerings


By SARAH MCBRIDE

Sony Corp.’s Sony Pictures is beefing up Crackle.com, its video-viewing Web site, adding dozens more movies and an interactive game in an effort to draw more young males, its target audience.

The move could help Crackle keep viewers on its site longer, which in turn would help boost its standing with advertisers.

Crackle’s three million unique viewers spent an average of just five minutes each on the site in March, according to comScore Inc. That compares with 57.9 minutes at Hulu.com, which had 42 million unique viewers; 59.6 minutes at Joost.com, with 523,000 unique viewers; and 15.8 minutes at Yahoo video, with 6.7 million unique viewers.
[crackle.com] Columbia/Everett Collection

Crackle is offering streamed views of ‘Spider-Man 2,’ a relatively recent movie compared with those typically available to watch free online.

“If the property is sticky, you have more of a likelihood to get in front of a viewer multiple times,” says Donnie Williams, head of digital strategy at Horizon Media Inc.

Under its new push, to be announced Wednesday at a digital-advertising event, Sony will make about 100 movies immediately available. The company will be taking advantage of gaps in “windows” — portions of time a movie might be under license with a TV or cable company for exclusive viewing.

Crackle is kickstarting its strategy by putting up for streamed views “Spider-Man 2,” which at five years old is relatively fresh compared with the other movies that are typically available free online as studios try to concentrate on other distribution platforms for newer titles. On other sites, movies might be as old as “Blackmail,” the 1929 Alfred Hitchcock classic.

Sony recently announced an agreement with Google Inc.’s YouTube to make its movies available on that site, but the agreement is limited to about 15 titles.

The shift in strategy allows Sony to keep drawing revenue more consistently from its titles while maintaining some exclusivity by keeping viewers on a proprietary site. “That, strategically is (maintaining) the Sony franchise,” says RBC Capital Markets analyst David Bank.

Write to Sarah McBride at sarah.mcbride@wsj.com

YouTube Boosts Full-Length Movies, TV Show Lineup

Associated Press

By RYAN NAKASHIMA AP Business Writer

LOS ANGELES–Google Inc.’s YouTube said Thursday it is vastly expanding its library of full-length movies and TV shows it offers online, while also launching a new advertising service and adding about a dozen new content partners.

The long-form videos will be housed on a unique page at http://www.youtube.com/shows and get a “Shows” tab on the main YouTube site.

The offering, which was due to go live late Thursday, marks a further departure from the fuzzy homemade clips that made the Web site popular and is the latest move in YouTube’s attempt to boost sales and profits. Last week, YouTube announced it was teaming up with Universal Music Group to create an online music video venture.

“It’s a first step in a long commitment,” said Shiva Rajaraman, a YouTube senior product manager, in a conference call with reporters.

The company hopes to add to its movie and show content over time. The titles available at launch are mostly older fare that are already available elsewhere on the Web. It will offer for free hundreds of TV show titles including “Beverly Hillbillies” and “Married With Children,” and hundreds of movies, including “Casino Royale” and “Cliffhanger.”

The service expands on YouTube’s existing partnership with several studios, whose parents include Sony Corp., Lions Gate Entertainment Corp., CBS Corp., Metro-Goldwyn-Mayer Inc. and Liberty Media Corp.

On Thursday it also announced new partnerships with 13 smaller companies such as Discovery Communications Inc., National Geographic and SnagFilms LLC.

Advertising revenue will be shared with the content providers.

The news came on the same day Google said it earned $1.42 billion, or $4.49 per share, in the first quarter, up 9 percent from a year ago.

Google bought YouTube for $1.76 billion in late 2006 but it hasn’t emerged as a major marketing vehicle and the company does not disclose its revenue figures. Analysts have estimated its revenue in 2008 at around $200 million.

On Thursday, YouTube spokesman Chris Dale simply said a recent analyst estimate that said the site lost $500 million a year was “factually incorrect” and said its performance was better.

As a way to bolster its ad revenue, YouTube also announced it is launching Google TV Ads Online, which will help advertisers target viewers of online content with video ads.

Single video ads are planned to be inserted in scheduled breaks in shows and movies, Rajaraman said. Sometimes the ads will be sold by Google and sometimes by the content providers.

Certain content providers also provide their own video players, such as Sony’s Crackle.com player, which will be embedded in the YouTube site.

Crackle.com has 60 movies on its site, but will be offering only 15 at time through the partnership. For example, “Groundhog Day,” initially will not be shared, as Sony managers intend to use YouTube’s large audience to help drive traffic to Crackle.com.

Are You Misusing YouTube?

By TIMOTHY R. HAWTHORNE
Founder, Chairman and Executive Creative Director
Hawthorne Direct

Why traditional advertising methods don’t work in the online viral video space

Depressed that your TV commercial on YouTube has garnered just 79 views after weeks online? You’re not alone. If you look at YouTube as a great place to repurpose your TV advertising into shorter bites for everyone to enjoy and respond to, then you’re coming at the online video trend from the wrong angle. In fact, marketers who use this approach will quickly find themselves scratching their heads over why no one is watching and/or sharing their video clips.

“We see a lot of agencies producing really cool commercials and throwing them on YouTube, thinking that it’s going to have an impact,” says Amanda Vega, formerly a paid blogger for America Online and current CEO of marketing consultancy Amanda Vega Consulting in Scottsdale, Ariz. “It doesn’t work that way.”

Creating the next “Will it Blend” video hit is the rare exception in viral strategies. That’s because in the world of viral video, people are looking for useful, informative and entertaining content that they can interact with and share with friends. Few are interested in DRTV commercials, and they’re certainly not enticed by the hard sell. “Unless what you’re doing is exceptionally creative which is usually not the case then no one is going to be interested,” says Vega, who advises companies to be original when developing online video. “The content needs to be fresh and interesting, not re-warmed.”

Marketers also run into challenges when they assume a “build it and they will come” posture by creating online videos and hoping someone will watch them. “If the company doesn’t already have a following, and a channel to push the message out to,” Vega explains, “then the results will be pretty poor.”

Those firms that post videos without the appropriate interaction mechanisms are also missing the boat. To maximize the “social” aspect of online video, you must provide a way for customers to connect with your firm, usually via a comment section located on the screen below the video itself. “Companies that don’t respond to at least some of those viewer comments,” says Vega, “are completely missing out on YouTube’s valuable social media component.”

Vega points to electronics manufacturer LG as a good example of how quickly a traditional advertising approach can backfire on YouTube. “The company took its TV commercials and put them on YouTube, but never responded to anyone’s comments,” explains Vega. “Then it left them up there, thinking “Oh yeah, this is going to transform into a viral campaign.” (The company also re-purposes its blog postings on social networking sites like Facebook.)

“LG assumes it will pick up thousands of viewers and commentaries simply from people looking at its videos and blogs,” says Vega, “but that’s not at all what social media is about.” It is about putting useful information in the hands of viewers, and then inviting them to interact with that content. Here are just a few ways that companies are doing that:

Demoing New Products
Use the video to share a new product, tell how it works and show how it can help improve the viewer’s life. Tell them where they can buy it, and what your customers are saying about it. Invite interactivity (via a comment section, for example) and discussion, both of which differentiate online video from traditional advertising.

Stretching Their Ad Investments
It’s okay to select informational or useful snippets of existing commercials, just as long as you’re not using blatant advertising methods. Remember that the Web is a medium that allows companies to see who’s watching, and responding to, their videos. Online, you’ll be able to track how many times your video has been played, and stretch your advertising investment.

Positioning Themselves as Experts
If you’re known as an expert in your field, consider shooting a one-minute video giving viewers four valuable tips from your area of expertise. A hair salon owner, for example, could highlight three tips for maintaining healthy hair. Make sure you include a place where viewers can leave feedback, and a link to your company’s Web site for more information.

There are literally hundreds of different ways to maximize YouTube’s reach without crossing the line and using blatant advertising. But as many companies have already learned, the portal’s viral component can be unpredictable and difficult to plan for. Remember the crying man who gained popularity with his “Leave Brittany alone plea? Millions of viewers were drawn to it during a short period of time due to the massive sharing of the video, and the subsequent press attention, despite its sheer silliness.

“Viral is something that takes place organically,” says Vega. “Companies have very little control over it, and really can’t say ‘okay, we’re going to make this go viral.” Because online video uploaded to sites like YouTube falls into this category, the best approach is to come up with creative, original content that tells a story that viewers will be interested in.

TV/Online Metrics: YuMe’s Internet GRP


Consumer hunger for online video soars and advertisers are eager to shift spending to follow the viewers. But how to compare the relative value of buying traditional 30-second spots on NBC with 15-second pre-roll ads on, say, Hulu?

MindShare has inked a deal with online video ad network YuMe to deploy what is tabbed an Internet Gross Rating Point, or iGRP, which allows for an apples-to-apples comparison between the new metric and the traditional GRPs used for TV.

YuMe said determining an iGRP will “ideally” take into account more than reach and frequency. It includes the benefits of an online video ad, such as interactivity and heightened targeting not found on TV.

YuMe also said it would collaborate with MindShare in R&D to determine the run of “variables” that ultimately could be factored into an iGRP calculation. That may include format of the video ad, its duration and the content type.

“Working with YuMe to develop an online audience measurement metric that more closely matches the same metric we use in buying television is critical to compare, contrast and analyze online video,” said Bethany Mach, a senior vice president at MindShare. “We need a standard approach we can all apply to measure audience and reach across any screen.”

Northern California-based YuMe, backed by private-equity investors, said it would calculate iGRPs on a monthly basis for its ad networks for now. It would also “make (an iGRP) comparable to a television GRP by using total population and/or household numbers.”

Jayant Kadambi, president of YuMe, said: “We’ve taken an important step in beginning to understand online ratings measurements by introducing an online video GRP metric that we hope the industry will standardize around.”

YuMe says it serves video ads on 500+ sites that lead to an aggregate of more than 500 million streams a month.

An iGRP could allow for comparing value in online and on-air ads, as well as how to engineer campaigns that employ both platforms.

Borrell: TV Stations Hit $1 Bil. in ’08 for Online Advertising April 2, 2009

April 2, 2009

-By Janet Stilson

Broadcast TV stations reached the $1 billion revenue mark for online advertising sales for the first time in 2008, a 36 percent rise over 2007. And while in the majority of markets newspapers are still outstripping the TV outlets with unique visitors, the broadcasters are gaining ground. Last year, local TV sites surpassed newspapers in 22 markets out of 80 markets, in terms of unique visitors, compared with only 16 markets last year.

That’s according to a Borrell Associates report commissioned by the Television Bureau of Advertising, which was released this morning at a conference attended by TV station representatives and the press.

In Top 20 markets, TV site revenue grew 65 percent, year over year, with per-station online revenue surging past $1 million for the first time. Markets ranked 51 to 210 had an average gain of 33 percent. But there was a 3 percent decline in revenues by markets ranked 21 to 50. Gordon Borrell, CEO of Borrell Associates, said that decline mirrored a similar trend among newspaper sites. “In the mid-market levels, they came on very fast,” he said, noting that many midsized-market TV sites launched a decade ago. “They saw an awful lot of growth but hit a wall last year.”

Val Napolitano, president and CEO of the rep firm Petry Media Corp., thought it “odd” that results for the 21-market to 50-market segment were so different from the others. “I wonder if it had something to do with the sample size,” he said. “It stands out as too much of a differential for me to buy it.”

“Some ownership groups are down 20 percent,” said a TV station executive requesting anonymity, in speaking of the online revenue trend. “The auto category has had a big impact not only on broadcast sales, but also [on] digital.” Because so many newspapers are closing down, he sees an important opening for local TV Web sites, as well as an opportunity to steal share from Yellow Page directory–type companies.

Borrell also sees a huge growth opportunity for local TV sites. He noted that out of an estimated $12.7 billion in local online advertising revenue last year, stations only garnered about $1.05 billion. That represents a mere 8.3 percent of all local online revenue. The broadcasters were outstripped by newspapers (27.7 percent), directories (10.8 percent) and pureplay Internet sites (47.2 percent).

Only 5 percent of stations made more than $3 million in online sales last year. Some sites with smaller amounts of traffic targeted to niche users, such as soccer moms, generated much larger revenue per unique visitor, from $25 to almost $70, compared with the vast majority of TV sites generating $10 or less.

Borrell forecasts local TV online revenues at $1.826 billion by 2011, out of total local online revenues of $16 billion.

Among the key challenges for broadcasters is their reliance on banners and other standard format display advertising, which is one of the lowest growth formats, Borrell noted.

Also, there’s a need to devote more sales people to online sales in order to see big revenue increases. It’s a real Catch-22 to dedicate people to online pursuits in such a tough economy, noted Francis Comerford, president of platform development and commercial operations at NBC Local Media, a division of NBC Inc. “I agree that having focused digital teams makes a difference. By shifting assets, both on the creative side and sales side, we’ve been able to gain more in that marketplace. Because if you don’t, you really can’t compete. 55 percent [of NBC Local’s sales team] is core television. The remainder is a combination of business development and digital.”