Navigating video from a view to a profit
AFTER a decade running video operations for global media giants, I began to realise that while my division was hitting its traffic KPIs and increasing revenue, the video business as a whole was making a collossal loss.
Baffled and frustrated, I hit up peers and friends in similar companies and roles all over the world, and they all admitted they had the same problem.
So, with the best intentions, five of us quit our jobs to chase a lofty goal — to navigate every video stream in the world from a view to a profit. And from that was born Oovvuu.
In the years since, we have dissected the worldwide video economy at a granular level. And like the chameleon above (he’s called Hector by the way) we have found the industry is a moving feast and we must constantly adapt to our surroundings.
So far, we have identified five disciplines that must be nailed to achieve the seemingly elusive profitability:
- Analytics and
Oovvuu is attending IBC in Amsterdam this week to reveal the products it has built to address each area.
Our content solution is called Source:
We started our journey by painstakingly curating a collection of 8,000 full-length documentaries, factual and current affairs shows from 50 top content providers including the BBC, Al Jazeera, ABC, ITV Studios, Endemol Shine, HBO Documentary, Discovery and many more). Every title was selected because it drove revenue.
Collating, categorising and analysing this catalogue took years. There are now $60 million worth of shows in there — yet we are so confident about its ability to drive a profit, we give it away for free.
I’ll say that again. FREE. More on that later.
Growth was about Eureka:
Time and again we watched companies hire more staff, unique content and invest in marketing in a helter-skelter drive to grow video streams only to realise later that video margins are so thin, this approach kills any chance of profitability.
We sought a different, smarter, cheaper and ultimately profitable direction. And this meant a focus on facts.
Our Eureka moment was realising that if you want to get more people watching video, give them what they are interested in.
Sounds simple doesn’t it, but that’s not what most media companies and broadcasters do. They create what advertisers ask for (think native content) and then thrust it in front of an audience to get eyeballs.
Oovvuu’s approach was fundamentally different and better. We surmised that if a person is reading an article about global warming, they have pre-qualified their interest in the topic.
If we then source and embed a video about global warming into the article where it can be watched in situ, people will watch it because they are actually interested.
We have done this hundreds of millions of times now, and people do watch it — on a few provisos. It must be good or they drop out fast. And that’s their version of good, not yours. It must be contextual or they drop out feeling cheated. If it says it’s about global warming, don’t cynically serve them a thinly-disguised ad for insulation pretending to be editorial. And if it is good and contextual, it doesn’t matter how long it is. Many of our shows are more than an hour in duration. Try achieving that with most sponsor-funded video.
We had found a method to get videos in front of people when they were most interested and it was generating profits. Then we need to grow it.
That led us to partner with IBM to utilise its artificial intelligence computer Watson. Oovvuu’s team worked with the IBM team to get Watson to ‘watch’ all the thousands of videos and millions of descriptions in our Source catalogue.
We then tasked Watson to ‘read’ all the articles in the news brands our customers were most interested in.
Using Eureka we can now embed the right video in the right article to read the right engaged reader at just the moment they are interested. And we can do this in a third of a second and without spending a dime on marketing. It was a Eureka moment — hence the name.
Sales meant we needed to Connect:
Eureka and Source began stimulating rapid growth in streams for our customers — so much so that we created more video ad inventory than our customers were able to sell.
A good problem to have, some would say, but if your focus is profit, it is another problem that needed solving.
When the Oovvuu team set out on whiteboards in the heady early days, ad tech was not on our radar, but over time our customers demanded we made it a priority.
The first experience we had with sales was our customers’ internal sales teams swearing blind they could sell every video ad we could generate.
This was not even remotely close to true. Our best customers struggle to sell even half of what they are given.
The typical reaction is to seek a solution in programmatic advertising, but after years of working with the networks, the world is finally coming round to what we knew all along: It does not work.
For an idea of the scale of the programmatic problem, we tracked every ad one of our customers delivered every second of every day for nine months. Over that period, 73% of all the ads the programmatic agency claimed to have sent either didn’t arrive, contained errors that made them unmonetisable or they were so badly set up that they timed out long and viewers quite the player long before any ad was delivered.
We now have a solution to this problem but the first step to being able to use it, is knowing the problem you have now.
Connect is our tool that ‘listens’ to all the ad calls and ad returns and can tell you the next day how your ads are performing.
You no longer need to listen to lies or be befuddled by technical jargon, because we cut to the chase — the dollars.
Doing this has already enabled one of our customers to generate $4 million from ads they could not previously sell. Worse, it was from ad inventory their ad team had previously promised did not exist. Connect proved it did.
You need Compass to set your analytics:
Our team was really starting to get to the heart of the issue, cutting through the noise, fear and lies— but then it got complicated.
Oovvuu’s servers were now crunching tens of millions of bits of data every day. Our less capable customers were constantly shifting from one analytics platform to another, driven by the desperation of their internal tech teams. One day it was Adobe, then Ooyala, Brightcove, perhaps some DFP, Accenture. You name it.
Oovvuu was crunching all these inputs and making sense of it, but the sheer volume of data, the different interpretations and the underlying sense of frustration was causing incredible tension, distrust and confusion. It was then that Compass began to take shape.
In a sea of confusion, it is simple to get lost. Compass was designed to translate all the data signals into a single source of truth focused on navigating customers from a video view to a profit. And it does it fast providing sales, traffic, costs and profitability daily.
Compass is the pinnacle of what we do as it brings simplicity where there once was chaos. Every morning at 6am, customers receive an email telling them how many streams they delivered, how many ads were created, how many ads were sold, how much they spent and how much they earned. Most importantly, its dashboard shows whether they made a profit. And if not, why.
It is peace of mind.
To achieve scale you need to Rise:
This entry has taken you on the journey we and our customers have been on. Now, our customers are seeing profitability for the first time. Now they have it, they want more. Their request was: How can we scale profitably?
It’s a fact that most video business plans start with an Excel spreadsheet and some well-intentioned guesses, but the compounded errors ensure it will never achieve its goal.
We spent years talking to customers to establish a common denominator they couldn’t argue over so we could develop Rise.
We envisioned an online tool where customers could choose their video, input their ad load and CPM, the cost of staff, CDN charges and the cost of an online video platform and receive an evidence-based business plan for profitability in return.
Rise now does this. Every customer who approaches us is put through Rise to show them the realistic return they can expect. Better than that, once all are agreed, it crunches the numbers and sense-checks it against our global database and sets the daily KPIs each division much achieve to hit the goal.
It’s very clever.
Five products: Source, Eureka, Connect, Compass and Rise to navigate every video in the world from a view to a profit.
Now, as promised, back to Source’s FREE content catalogue . (You deserve to know this because you have read to the end☺)
Oovvuu has an amazing deal with the BBC, Al Jazeera, HBO Documentary, ITV Studios, Endemol Shine and many other content providers. They have given Oovvuu permission to release this unprecedented $60 million catalogue of shows we know make money to distribution partners for free on a revenue share.
Giving away top titles feels counter-intuitive but they feel like us that the time has come to tinker with the age-old logic of exclusivity. They, like us, are focused on building the future that comes after TV. We do not think it will only be Netflix or YouTube or iTunes, but something else as well.
And we need your help to find out what that is which means we want to get the best shows to the best people everywhere and as often as possible.