Minick Group by EveryAvenue

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									Ad-supported content – OK for the users,
the advertisers and the content providers?
                   Copenhagen, 19th June 2008

                       Dr. Alexander Trommen
                            COO MINICK Group
         MINICK Group Introduction

           One of the most experienced players – founded in 1994
           > 100 manyears R&D ressources invested into our
             platform
           > 1.000.000.000 P-SMS processed
           > 1.000 campaigns managed
           > 500.000 content items in the platform
           > 350 WAP/i-mode portals launched
           One of the largest distribution channels for content
           partners supplying over 37 operators worldwide with
           mobile content
           Leading on-deck outsourcing partner for MNO‟s in GSA        Picture: Hamburg office

           4 offices guarantee international reach and local support
           Subsidiary of Swisscom Group




MINICK Presentation | Mobile Video/TV Advertising | Page 2
             The share of consumer‘s mobile content
             expenditures compared to the total budget is low…
                                      ????????????????????




                                                                   Commercial Downloads
                                                                   Mobile Content
                                                                   Other
                                                                   Games
                                                                   Kino
                                                                   DVD
                                                                   Musik
                                                                   Buch




Source GFK Presentation Mobile Advertise Convention 2007, Munich




  MINICK Presentation | Mobile Video/TV Advertising | Page 3
               … and the mobile content market is not growing at
               the moment

                                                            Jan - Sep 06   Jan - Sep 07   VR in %



              Ringtones total                                     52           37          -29

                  - thereof monos                                 <1           <1          -65

                  - thereof polys                                 16            9          -41

                  - thereof Reals                                 35           27          -23

              Videoringtones                                       1            1          -43

              Ringbacktones                                        2            3           48

              Full Track on Mobile                                 4            6           47

              Games                                               37           40           7

              Logos                                               12           11          -10

              Other contents                                       7           10           38

              Total                                               114         106           -7

Source: Market Research Germany 2007 compared to 2006


     MINICK Presentation | Mobile Video/TV Advertising | Page 4
          Whereas the European Mobile Marketing forecast
          2010 demonstrates strong growth anticipation




Source: BCG M-Marketing Model 2007 for Swisscom




 MINICK Presentation | Mobile Video/TV Advertising | Page 5
             In Germany Alone Over 100 Portals Already Build Their
             Business on Mobile Advertising




Source: Vodafone Media Solutions




  MINICK Presentation | Mobile Video/TV Advertising | Page 6
           The Usage of the Mobile Internet Is Still Low
           Compared to the Web




Quelle: Vodafone Media Solutions, Daten Stand Ende 2007




  MINICK Presentation | Mobile Video/TV Advertising | Page 7
         Vodafone Media Solutions Advertising Types




MINICK Presentation | Mobile Video/TV Advertising | Page 8
          Overview on content pricing in Germany in 2007


                                             Spiele / Games                                     4,35

                         Screen Saver / Bildschirmschoner                                2,99

                                             Videoklingelton                      2,61

                                                   Realtones                    2,44

                                              Videos / Filme                    2,37

                            Grussbotschaften / Voice Cards               1,99

                                     Klingeltöne monophon                1,99

                                             Freizeichentöne             1,98

                                       Klingeltöne polyphon             1,91

                                              Logos / Bilder           1,77

                                        Full Track on Mobile    1,41

Kostenpflichtige Informationen über WAP / Handy-Portal         1,31

 Source Vodafone




MINICK Presentation | Mobile Video/TV Advertising | Page 9
         Ratio premium to adfunded gross revenues at cost-per-
         thousand ad impressions 100 €


             Premium-funded model                                  Ad-funded model
             (number of purchases)                            (number of views/downloads)

                                        1          Games                                     43,5



                                        1       Screensaver                           29,9


                                        1         Realtones                    24,4


                                        1           Videos                   23,7


                                        1           Logos             17,7




MINICK Presentation | Mobile Video/TV Advertising | Page 10
         Overview of the value chain and the retained percentages


                         Advertising              Media Sales           Service
 Advertisers                                                                                Publishers          Consumers
                          Agencies                 Agencies             Enablers

               Pays 100%
               GROSS ad rate

                                                 Retains ~25%
                                                  of GROSS ad rate

                                                                     Retains 15~20%
                                                                      of GROSS ad rate

                                                                                          Receives 55- 60%
                                                                                             of GROSS ad rate



                                                                                           Shares 25- 30%
                                   100
                                                                                            with Content
                                                                                              Provider
                                                        25
                                                                            15

                                                                                             30


                                                                                                                 30

                               Advertisers           Media            Technology          Publishers            Content
                                                    Agencies           Enablers          (Site owner)           Provider



MINICK Presentation | Mobile Video/TV Advertising | Page 11
          Objectives of the Pilot Study




     Test customer acceptance of advertising placed in mobile video content

     Test readiness of the technical components & overall solution for commercial use

     Determine the economics of an advertising-subsidized content model through demand
     elasticity - if such content is offered at a discount or for free

     Determine the cannibalization potential of ad-supported content on premium content

     Test advertising community’s readiness to utilize new media such as mobile video




MINICK Presentation | Mobile Video/TV Advertising | Page 12
             Pilot Content
Phase 1                                                                   Phase 2
            ‘The Daily Laugh’                                                            ‘The Daily Tune’


    Launch:                       4th June 2007                           Launch:                       6th August 2007
    Content:                      „Hidden camera‟ comedy                  Content:                      Music video clips
    Distribution:                 Vodafone live!                          Distribution:                 Vodafone live!
    No. of episodes:              Initially 30 episodes                   No. of songs:                 tbd
    Duration:                     2 to 5 minutes                          Duration:                     2 to 5 minutes
    Update frequency:             Daily, 7 days/ week                     Update frequency:             tbd



          Intro               1st advert             Show title                          Show content                2nd advert




   „The Daily Laugh‟
     – get it for free
     after only one
     advertisement!




                                                            2 to 5 minutes in duration




  MINICK Presentation | Mobile Video/TV Advertising | Page 13
          Swisscom Video Advertising Pilot: Participants

          Content                                             Partner        Technical
                                       Brands                                                          Publisher
          Provider                                            Agencies        Partner



                                                                         Video content hosting    Via Vodafone live!
                                                                             and serving.        Mobile Internet Portal
       Provider of „The
      Daily Laugh‟ Show


                                                                            Ad serving and
                                                                         campaign management
     Provider of the music
          clip library




MINICK Presentation | Mobile Video/TV Advertising | Page 14
          Volume increase compared to premium services

   Comparison between two VoD services in the comedy
   genre                                          Same promotion; perhaps even slightly more
                  „Nur zum Spaß‟: free of charge                promotion for ‘Foreplay’
                  „Foreplay‟: Premium content (2 CHF/ week)

RESULTS
  Within one week after launch and without any
  further promotion, „Nur zum Spaß‟ reached the
  10-fold streaming volume of „Foreplay‟
  Over a period of 6 weeks, „Nur zum Spass‟ had
  an on average 8 times higher streaming rate
  than „Foreplay‟
  And this although…
                 …the launch of VF live! in the 2nd
                 week of „Nur zum Spass ‟ had a
                 strong influence on the service due
                 to modified navigation
                 …compared to „Foreplay‟, „Nur zum
                 Spass‟ corresponds rather to a sub-
                 standard content



MINICK Presentation | Mobile Video/TV Advertising | Page 15
          The service did not lead to frequent usage

                                        Usage intentsity



                Once                                                             52%
                                                                                                   Single user

     Very few times                                                 36%



Several times a week                 10%


                                                                                                   Multiple user
                Daily        2%



 Several times a day     0%


                        0%        10%         20%             30%    40%   50%         60%
                                                                                             n = 130 (People, who watched
                                                                                             the show at least once)




MINICK Presentation | Mobile Video/TV Advertising | Page 16
          Reasons for the one-off usage of the service

                                                        Reasons for one-off usage

                       Not enough time                                                                     27%
              Not interested (generally)                                                             25%
              Did not work (technically)                                        15%
              Not my sense of humour                                     12%
                         Too expensive                                   12%
            Disappointed/ did not like it                          10%
             Did not recover the service                  5%
                      Too small screen                 4%
              Annoying advertisements             2%
                                   Other         1%
                       Don't know/ N/A                    5%

                                            0%          5%       10%           15%    20%          25%           30%

               You state that you watched the service 'Nur zum Spass' only once. Can you name the reasons why
                                             you did not watch the service again?

  According to the numbers, it is unlikely that the integration of                          n = 67 (People who watched the
                                                                                                    broadcast only once)
  advertisements into the content is annoying for a large number of users


MINICK Presentation | Mobile Video/TV Advertising | Page 17
          High degree of acceptance for ad-supported content

                                          Acceptance of ad-supported content


        Total (7.1 points)


                                                                                                   Very good (8-10)
Multiple user (7.7 points)
                                                                                                   Rather good (6-7)
                                                                                                   Rather not so good (4-5)
                                                                                                   Not good at all(1-3)
  Single user (7.9 points)
                                                                                                   Don't know


    Non-user (6.5 points)


                             0%   10%   20%   30%    40%      50%   60%   70%   80%   90%   100%

           The service 'Nur zum Spass' is based on the idea, that users can watch a video free of
          charge, if they are willing to watch an advertisement before and after the video. What do
                                            you think about this idea?
                                                                                                                n = 304/63/ 67/ 174

    More than 80% of single users and multiple users reacted positively to the idea of ad-supported
    content


MINICK Presentation | Mobile Video/TV Advertising | Page 18
          Many users watched the ad until the end…




MINICK Presentation | Mobile Video/TV Advertising | Page 19
             … but the recall rates differ significantly

                                      Recalling of different advertisements

                    Migros Fit                                                      29%
                 Beck & Bond                                    14%
                  Bluewin TV                     7%
                       Canon                     7%
                 Migros Bank                     7%
           Monster Jobsearch                     7%
       1811 (Swisscom Fixnet)                    7%
               Sony Ericsson                5%
                      Mobilar          3%
 Gesundheitsförderung Schweiz         2%
                     Nicothell        2%
                     Peugeot     0%
          Swiss Campari Soda     0%
    100 Sekunden Tagesschau      0%
               Nestle Fitness    0%
                   Hug Biwak     0%

                             0%            5%         10%       15%   20%     25%   30%         35%
                                                                                     n = 62 (People, who watched the
* High recall rates generally correspond to the frequency with which an ad was               show at least once and
      broadcasted                                                                            recognized an ad)



  MINICK Presentation | Mobile Video/TV Advertising | Page 20
          What influences mobile video ads?


     Apparently, the placement of a specific advertisement either before or after the video
     content has only a limited influence on whether the advertisement is watched until the end




                                                              n = 3167                     n = 1182




MINICK Presentation | Mobile Video/TV Advertising | Page 21
                                What influences mobile video ads? – contd.

            The length of the advertisement appears to be an important factor which decides whether
            or not an advertisement is watched until the end

                                                              Pre-roll & Post-roll Ads
 (Canon) (Swisscom)
            1811




                                11 seconds
 EOS 400
  Canon




                                12 seconds
   Mobile) (Migros) Ericsson)
                      (Sony
                      W881




                                                                                                                Pre-roll
                                12 seconds
                                                                                                                Post-roll
 (Swisscom Migros Fit




                                20 seconds
   Napster




                                40 seconds



                                             0%   10%   20%    30%   40%   50%   60%     70%   80%   90% 100%               n = 3288




MINICK Presentation | Mobile Video/TV Advertising | Page 22
          Our conclusions regarding the pilot so far…

 Most people think mobile screens are too small for watching TV, although new
  iconclastig devices like the iPhone are reducing the resistance

 Consumers are used to ads in public (e.g. billboards) and on devices that they share
  with others (e.g. TV, radio), but the mobile phone is a more personal device: Are
  customers ready for the intrusion of advertising into the private dimension of their
  mobile phones?

 The biggest USP of mobile ads “relevance”. If marketers get access to the rich user
  profiles of MNOs, they can tailor their advertisements to be as relevant as possible to
  individual customers

 It is important to find the right balance between reach and control

 The pilot study indicates that mobile video can be an effective medium for
  advertising and should continue to be explored

 Are we prepared for triple screen advertising?



MINICK Presentation | Mobile Video/TV Advertising | Page 23
          Stay-in-touch




                                                                   Dr. Alexander Trommen
                                                                       COO MINICK Group


                                                              alexander.trommen@minick.net
                                                               Cellphone: +49 173 616 6867




MINICK Presentation | Mobile Video/TV Advertising | Page 24

								
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