Four simple strategies for monetizing your video content

Four simple strategies for monetizing your video content

BY FRANK BESTEIRO 
ON MAY 24, 2013

Recently, some of YouTube’s content partners have expressed their displeasure with the returns they’ve been seeing from the video behemoth. While views have continued to increase over the last few years, ad revenue remains unimpressive. And while content creators would be well advised not to bet the house on YouTube to begin with, the problem of successful monetization is one that the industry has yet to fully master. Even the biggest creator networks and media companies still struggle to justify the expenses involved in video production. While there’s no magic bullet for this issue, content creators should be aware of all of their options in order to drive the best returns.

Here are four worth considering:Product Placement: Just like the TV business, plenty of brands are willing to shell out to have their products featured in high-quality online videos. The first and most basic rule is also the one that many creators ignore: make it feel natural. Hitting your audience over the head with a product is not only likely to turn them off to your content, it probably won’t do the advertiser any favors either.

Only partner with brands whose products fit seamlessly within the context of your videos and which are likely to appeal to your audience. A web series on a suburban soccer mom would be a perfect place for consumer packaged goods or toy brands. A series on four bachelors living in New York City would not. It’s also good to keep in mind that these kinds of deals can take time to materialize, so if you want to go this route, it’s best to start reaching out to advertisers as early as possible so you can work products into the script.

Sponsorships: Unlike product placement, which necessitates having advertisers identified and on board prior to production, sponsorships can be created around videos that have already been shot. This can include a branded player or page and can be used alongside pre-rolls from the same brand. As with product placement, the advertiser’s messaging should fit with the video’s audience. Watching a video surrounded by branding that’s out of sync with the content can be a jarring experience for viewers.

Pre-rolls: These 15- or 30-second spots are one of the easiest ways to drive revenue off your video content. Contrary to what many in the industry would have us believe, most consumers have accepted watching a short commercial as a fair exchange for free video content, as evidenced by steadily increasing ad completion rates over the last several years. For publishers who have a substantial amount of video inventory, having a dedicated sales team that is specifically trained to sell video is key. The key to a successful pre-roll strategy is maintaining the ratio of ads to content – don’t overwhelm viewers with an overly aggressive ad load.

Subscriptions: Currently, there are very few sites charging users a subscription fee for video content created purely for the web, so data that speaks to how effective the model will be is scarce. That said, there’s plenty of evidence that consumers are becoming more comfortable with paying for a la carte entertainment options like Netflix, Amazon Prime and Aereo in addition to, or in lieu of, their monthly cable bill. YouTube announced earlier this year that they were going to start experimenting with charging users a modest fee for monthly access to some of their most popular channels. If consumer response to this experiment is positive, we may start to see other premium content producers follow suit.

Smart video creators will experiment with all of these options to find the mix that meets their revenue goals while keeping their audience engaged. Having a solid distribution strategy is also crucial; all of the pre-rolls and product placements in the world won’t do any good if no one is watching your video. Publishers need to think about pushing their video content beyond the confines of their own site and getting it in front of users who are actively consuming video content. Syndication is one of the best ways to do this, though native placements and earned media campaigns are useful tools as well.

The bottom line is there is plenty of money to be made in online video, you just need to know where to turn.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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