The Road to NAB - Chapter 4: Viewer data: the oil of the 21st century
Kenneth Stamp is a storyteller at TradeCast.tv, the Dutch startup that’s disrupting publishing and television with an all-in-one platform for starting your own online TV channel and content platform. Leading up to NAB 2017, the world’s biggest broadcasting trade show where TradeCast.tv is selected as one of thirty leading TV startups, Kenneth shares his vision on the radically changing worldwide television landscape. This is the fourth of six chapters:
The Road to NAB 2017 - Chapter 4
The oil of the 21st century: the big importance of viewer data in online video marketing
‘Data is the oil of the 21st century.’ Sounds impressive, right? That phrase was coined by British mathematician Clive Humby in 2006, to illustrate that data in general - just like rough oil - is only of value when processed and used correctly. That goes double for viewer data: the information of people who watch and interact with online video content. Why is viewer data so important for owners and distributors of video content? What can you do with viewer data? And why is collecting viewer data on a platform of your own way more effective then on a platform you do not control?
So why is data in general - and viewer data especially - being called the oil of the 21st century? How important is viewer data for distributers of video content on the internet and the consumers who interact with that content? This has everything to do with the change in viewer behavior that is happening right now. Because an increasing number of people consume content online, the amount of data of those viewers also increases. And that data is greedily used by the many players on the online video market, each in their own way.
House of Cards
Social giants like YouTube and Netflix use viewer data to establish viewer profiles that become more specific the more data is available. These profiles are then used to serve commercials and content to viewers that are most likely to interact with that content. A good example of the value and use of viewer data is the creation of the Netflix show House of Cards, with Kevin Spacey in the lead. Netflix had so much viewer data of its users, that it could calculate that buying the show House of Cards would be a good and lucrative move.
This is because of a couple of reasons: lead actor Spacey was very popular among Netflix viewers, the movies of House of Cards director David Fincher were also watched a lot on Netflix and the British show House of Cards - where Fincher’s version is based on - also gathered a lot of views on the streaming platform. With facts like these House of Cards eventually grew to the cultural phenomenon it is now. ‘In TV, there’s no such thing as a guaranteed success’, used to be the motto. But maybe now - thanks to the amount of viewer data being collected - this statement has become outdated.
Okey, so viewer data allows you to make smart marketing choices and smartly serve out content to an audience that is more likely to interact with that content. Why is it so important to create your own online content platform and build a database of viewer information with this? Why can’t you just gather viewer data by publishing your content on YouTube and Facebook? Simple: because publishing your content on someone else’s platform doesn’t give you the insight you get when you are ‘in control’ of the platform yourself.
YouTube gives you pretty detailed information about the people who watch your videos, but you don’t get a chance to re-target or reach out to these viewers with specific information or an e-mail. The next statement was a huge eye-opener for me: “If you’re not paying for it, you are not the customer. You are the product being sold.” Or: you use a free content platform (ie. YouTube or Facebook) to publish your content, but by doing so, you give away your data to the owner of that free platform. There has to be another, smarter way.
Building a business
And there is. For instance by setting up your own online video platform, a step more and more brands, companies, sport clubs, publishers and celebrities take. Because when it’s you behind the wheel of an online platform, you do get all that comprehensive viewer data from your users. Again, I’m not advocating to stop using social media to distribute your content. What’s more, that’s actually a very smart thing to do, because social media websites are a great way to promote your brand. But they’re pretty terrible to start building a business and creating real, solid revenue streams with your online content. And since the amount of video traffic on the internet will reach about eighty percent in 2019, according to a report by Cisco, a strong online content strategy is now more important then ever.
So wether you’re Taylor Swift, Red Bull or Reuters, your own online video platform gives you countless opportunities to reach out to the users of your platform. You can obligate them to create an account (payed or free), before they can watch content on your platform. Or you can ask them to fill out their interests when creating that account, so you can start building a database of users that shows exactly what those users like. And this concrete target audience information is a treasure trove for potential advertisers and sponsors for your channel, because they can now serve out their advertisements to a target audience that’s fully interested in what they’re offering. But without that viewer data, you have nothing to bargain with, nothing to make money with. Because you are not ‘in control’, but ‘just’ a user of someone else’s platform.
The future of content
What can we say about the future of content creation and online television, with regards to the increasing importance of owning viewer data? That’s what the Boston Consulting Group has investigated. Because more and more people watch content on the internet (on demand), the television market is undergoing a major shift. And that shift has huge effects on the market, the viewer habits of people and therefore also the revenue models and distribution of video content.
BCG recognizes four trends: the first is that content distributors - like cable companies - are becoming a gathering point and search engine for TV watchers. Also, for distributors like Netflix and streaming platforms in general owning unique content is becoming very important. Make sure your platform has its own ‘House of Cards’, something the viewer can only find on your platform. Trend number three is offering content without the intervention of a settopbox from a TV distributor, so ‘over the top’ and in the cloud. And the last trend BCG sees is combining on demand content with linear live broadcasting. So that’s live television that is only available online. The recent launch of YouTube TV is a perfect example of this trend.
Data, data, data
For each of these four scenarios the gathering of viewer data is of tremendous importance. Distributors have to keep looking for ways to use their viewer data to serve out personal suggestions for commercials and content, just like Neflix does. For broadcasters, investing in a online video platform becomes really important. Gathering viewer data to attract advertisers is life or death right now. For television producers, offering unique content is key. There will always be a market for whatever content you distribute, as long as that audience can only find it with you. And starting your own online video platform is easier then ever right now, just look at companies like TradeCast.tv. Consumers have it the easiest: they just get more and more platforms to watch content they like. And that content is usually catered specifically to their tastes. What a time to be alive!
If you want to learn more about the opportunities your own video platform and targeted advertising can bring your company, contact TradeCast, check out our video below or meet TradeCast at NAB 2017: we’re part of the Sprockit HUB (North Hall, booth N2732) from April 22nd to 27th.
tel: +31 85 201 09 80