Search and video advertising are very different: the former captures intent, the latter captures interest.
This plays out very differently with the kind of advertising that each one draws.
Search: Direct Marketing
Search is perfect for performance based campaigns that need a positive ROI in the mid to long term (don’t kid yourself, all campaigns are ROI-negative in the short term). The problem with search marketing is the volume, generally speaking, all factors being equal, you eventually run out of leads and search queries you can advertise alongside, so you have to trade off quantity with quality… meaning that in the long, long run, it becomes less ROI positive… to the brink of becoming a losing proposition again.
Video: Branding
Video [online] is all about branding. On TV you buy airtime to run an infomercial looking for sales… on the Web, you run video ads because you are promoting a car or trying to get the word out on sales. Yes, you want cars being driven off the lot or butts in the theater seats… but you know video is a very different proposition.
It’s interesting to see TV.com try to mesh TV and Web… again. Will it work? Who knows. I had my own plans for TV.com, frankly… but that is pretty moot now.
Great Expectations
When it comes to what I find most different about video and search advertising, really, are the expectations.
Back in 1999, websites began to throw in the towel on search as a business.
AltaVista became a portal.
Yahoo! outsourced its search strategy to Google.
Google took advantage of the perfect storm to build a business valued at $200B (now $100B). Part of this had to do with the utter lack of expectations for search to become big. With video, it’s the opposite. With TV being a $65B advertising market, and with offline dollars flowing online faster than ever, people simply presume that eventually video will become huge, too.
This has spawned hundreds of startups to vie for the dollars… but right now the market is made up of pennies. I think the long term difference between search and video is there won’t be one company with the kind of market share and revenue stranglehold that Google commands in search. Look at video. Sure, YouTube does 50% market share with regards to streams, but it’s yet to crack the revenue enigma. Over time, I see a bunch of players each doing 1-15% revenue… with hundreds more doing 0-1% of the revenue in the space. At the other end of the spectrum, look at Hulu, everyone’s darling this year. We love Hulu too (as much as we love YouTube - they’re both distribution partners of ours), but Hulu will run out of content sooner or later. I know it sounds impossible but trust me on this one.
Era of Lowered Expectations
What this means for investors is simple: even before the market meltdown of 2008, chances were that the implied valuations being placed on some of these startups would never pan out… now with the market meltdown of 2008 ushering the era of lowered expectations I think this reality will only set in more and more in 2009 and beyond.
As we cross 35M streams since launching a couple of years ago:
WatchMojo.com is happy to welcome a couple of our latest distribution partners, the first is Sling Media:
“Sling.com is a wonderful combination of premium video content, television viewing, robust editorial and consumer-friendly access and socialization features,” said Jason Hirschhorn, President, Sling Media Entertainment Group. “Users will have a blast watching great clips, full length shows and movies while customizing the viewing experience to their liking.”
Sling.com features:
- Robust editorial programming: Sling.com’s editorial team creates great content including blogs, playlists and clip collections.
- Socialization features: Users can subscribe to any channel, show or user to create a feed of programming and activity that reflects your personal tastes and those of your social network.
- Slingbox access: For the first time, Slingbox owners can now access and view their home television (cable, satellite receiver) and DVR via the Sling.com website, making their Slingboxes available without a software client download.
“Our mission from day one was to enable access to content regardless of screen or source,” said Blake Krikorian, co-founder and CEO of Sling Media, Inc. “Sling Media will continue to link and meld video solutions from the television, computer and mobile device to create seamless experiences for consumers.”
Check out our channel here.
Also being announced today, but live for some time, is our relationship with 5Min.com. Here is the press release on that, more info on Tech Crunch, and a video to boot:
Sling.com is the latest partner to join our syndication network, which includes the very same companies that the media purports to be Sling.com’s competitors: Hulu, Joost and of course, when we talk about online video, YouTube.
As a content provider, I do see some nuances in how Sling.com is approaching the content aggregation angle which is very different than what Joost and Hulu are doing, which I think gives them a shot at making a dent in terms of market share. I wish I could say more… should be noted that while Sling competes with Hulu, it also partners with them. If you can’t figure out why, think of Sumner Redstone’s mantra “content is king”. The web has always been a place where competitors become collaborators…
As of now, we have a bunch of content up on Sling.com now (a few hundred clips)… and in the days and weeks to come, we’ll be moving our entire library over the site. I like the interface and the list of content is impressive. Time will tell if their property gains traction.
Sadly, Sling is only available to US residents, so global audiences will have to check out our content on other places.
I’ll be honest: I have no idea who will emerge as the winners of video content aggregation / distribution in 1, 3, 5 or 10 years, let alone 20-50 years… but I do know that it’s nice to hedge your bets and partner and license your clips to a wide array of players that have the DNA and people to be serious contenders, so while we long ago stopped giving content away to just any partner, I think it’s important to give some credit to what Sling Media has accomplished and give them the time it will take to build up a viable player in the space.
With the proliferation of blogs as news sources, companies are crowned as kings or tossed aside as clowns on the day a product is releases or a press release hits the wire… and obviously, that ain’t no way to build - or judge - a business.
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