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Veoh Networks Study Reveals That Engaged Long-Form Online Video Viewers Are Highly Receptive to Advertising

October 8, 2008

When it comes to advertising, not all online video viewers are created equal, according to a new commissioned study conducted by Forrester Consulting on behalf of Veoh Networks. Released today, “Watching The Web: How Online Video Engages Audiences” reveals that while some online video viewers still only “snack” on short clips, there exists a large audience of young, influential, engaged viewers who watch a great deal of long-form online video and pay attention to the brand messages delivered to them in online video environments.

The study found that Engaged Viewers (viewers who watch more than an hour of online video a week) make up nearly 40% of all online video viewers and watch nearly 75% of all online video. Of these Engaged Viewers, those who spend the most time consuming and sharing long-form content:

— Are more likely to watch videos all the way through

— Pay more attention to online video more than they do TV

— Interact with and rate the videos they watch more frequently

— Are twice as likely to recall in-video ads and post-rolls than non-Engaged Viewers

— Agree more readily that advertising is fair and helps pay for their free experience

— Consider banner ads and ads that come in between videos (mid-rolls) most effective

“As online video viewing continues to grow as a primary source of entertainment, it will create many new opportunities for content providers and advertisers alike to reach engaged, influential audiences,” said Steve Mitgang, CEO of Veoh Networks. “Now is the time for advertisers to re-think their approaches to marketing in online video in order to captivate these valuable viewers as they drive online video into a mainstream entertainment medium.”

Who is the Engaged Online Video Viewer?

For Engaged Viewers, online video viewing is not a fad but rather a growing consumer habit: 61% of Engaged Viewers expect to spend significantly more time watching online video in the next year. The study also found that Engaged Viewers are young: while 13- to 24-year-olds make up only 15% of the online population, they represent more than 35% of Engaged online video viewers. In addition, Engaged Viewers watch an average of 6 kinds of video content – from animation to TV shows to movie trailers – during the course of a month.

The study further segmented Engaged Viewers into three sub-groups based on time spent watching video, types of videos watched, comfort level managing the video viewing experience, propensity to share videos, and amount of attention paid to online video compared to TV:

— Watchers, those who spend just over an hour watching video each week but, besides showing up to watch, don’t engage the experience deeply by controlling playback or sharing videos

— Controllers, those who go one step further; these younger viewers take an active role in controlling their video experiences and feel that online video is important to their lives

— Connectors, though just 7% of online viewers, consume 20% of all online video and do 42% of all online video sharing.

Connectors and Controllers are especially valuable because they not only watch more online video than others, but they are shaping what others watch through their sharing.

Long Form Video Matters

The most desirable viewers – Connectors and Controllers – watch long-form video more often than Watchers do, so sites that offer a great deal of long-form video are the ideal places to reach them. Long-form video sites not only attract these viewers, but they also foster an environment that secures more viewer attention and engagement with advertising.

Given that both Connectors and Controllers spend more time on long-form video sites, they are more apt to feel that advertising is a fair trade off to pay for online video services. Even more important, Connectors are significantly more likely to notice brands and feel ads are useful when presented with products they are interested in.

Implications for Advertisers

As online video viewing matures, advertisers can take advantage of the unique opportunity to reach valuable Engaged Viewers by starting with the following:

1. Think Advertainment, not Advertisement. Engaged video viewers are more open to enjoying the advertising they watch giving marketers an opportunity to create ads that are as entertaining as the video clips they are paired with. Make the advertising a part of this engaging environment by telling compelling stories rather than consistently repeating the same 30-second spot.

2. Active mindset = greater action. Engaged video viewers are more involved in every aspect of the viewing experience, including the advertising. In contrast, watchers who sit down to watch a 1-minute user-generated clip come to the screen with very different mindsets. Consider having multiple creative units depending on the mindset d propensity to engage with the medium.

3. Think about all the ad units on the page as a team. All viewers feel advertising can be annoying. But none of them said it had to be annoying. Engaged viewers respond to ad formats that don’t intrude unfairly. Their preference for banner ads supports this. But banner ads can be supported by a comprehensive ad experience that ties display ads, sponsorships, and in-video ads together into a coherent package.

4. Target it and they will come. As more viewers spend more than an hour a week viewing online video, it’s time for advertisers and the sites that enable them to start matching ads to viewers more intelligently. The easiest place to do this is with long-form content, where the choice of programming – an episode of one’s favorite tv show – says more about a viewer than a short clip about a dog on a skateboard ever can.

Methodology

Forrester Consulting conducted this study with more than 1,013 people who watch online video at least an hour each week. These responses were calibrated against Forrester’s ongoing Consumer Technographics research to ensure response validity. Building on this insight, a sub-sample of 10 individuals who completed the online survey and gave explicit permission to be contacted for a follow-up interview were recruited to participate in 10 one-hour, phone-based in-depth interviews to discuss their experience with online video more fully. The combination of rigorous quantitative measures and qualitative insight paint a picture of today’s engaged online video viewer.

About Veoh Networks

Veoh Networks is an innovative Internet Television company that delivers broadcast-quality video programming via the Internet.

Veoh has more than 100,000 content publishers – from CBS, Viacom’s MTV Networks, ABC, Warner Bros. Television Group, ESPN and Lions Gate to thousands of independent filmmakers and content producers – and currently attracts over 28 million unique users per month worldwide. For advertisers, Veoh offers compelling ways of engaging with a targeted audience and measuring performance of their ad buys.

Among Veoh’s U.S. viewer base, 6 million are considered Engaged Viewers., with 65% of them falling in the highly valuable “Connectors” and “Controllers” sub-categories. On average, Veoh viewers consume more than 100 minutes of video per month on Veoh and spend 44% of their time on Veoh during traditional primetime television viewing hours. The company streamed more than 50 million hours of video in August. For more information about Veoh or to inquire about advertising opportunities, visit: http://www.veoh.com/advertise.html

Veoh Networks is a privately held company that is backed by leading technology and media investors, including Shelter Capital Partners, Spark Capital, Michael Eisner’s Tornante Company, Goldman Sachs, Time Warner Inc., Intel Capital, Adobe Systems Incorporated, Gordon Crawford, Tom Freston and Jonathan Dolgen. The company’s principal offices are in Los Angeles and San Diego, California.




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