Eyes on the Enterprise: Streaming Media's Marketing Potential
This commentary first appeared in the November 2006 issue of Streaming Media magazine. Click here.That sound you hear in the distance is the engines of long-silent internet hype machines beginning to whir once more.
Excitement over the distribution of video via the web is conjuring up renewed visions of online market opportunity. Mainstream media outlets are once again publishing ever more frequent stories about start-ups carving out new businesses in the online video sector. Venture capitalists are calling my office more often, trying to get a handle on the next big thing to incorporate web video.
Look no further than Streaming Media magazine, with page after page talking about the growing potential for digital technology to transform the way producers and publishers distribute multimedia content. Far be it from me to rain on anybody’s parade, but before we get too carried away I’d like to offer one simple reminder to anyone starting to get Gold Rush Fever, Web 2.0-style: Remember the business model.
It’s true that consumer adoption of a personal web publishing service like YouTube is a heartening thing for all of us in the industry. "People are using video online," we say to ourselves. "Somebody does love us, after all!" But after the warm fuzzies wear off, ask yourself a basic question: How can online video help people make money?
If history is any guide, the fine folks at YouTube have their work cut out for them even now that they're owned by Google. A decade ago, personal home page publishing sites like GeoCities, Tripod, and Angelfire all drew huge traffic volumes and yet starved for advertising dollars. No self-respecting brand manager at the time would pay good money to promote their product on a site predicated on the notion of distributing decentralized content that could not easily be monitored or controlled. There was just too much risk involved.
Odds are that a similar fate awaits GUBA and dozens of other denizens of the Web 2.0 world. Certainly, lucrative futures still await those entrepreneurs who can build hype-driven, high-volume video sites; YouTube's founders cashed in for $1.65 billion, and others are sure to follow as portals or search engines look for multimedia heft. Kudos go to the risk takers who will cash out in this fashion.
Such a vision, however, sells short the potential for how video can (and will) truly transform the way people use the web to communicate more effectively. A growing number of companies are citing interest in using the web to place advertising in identifiable content genres offered online. And it is reasonable to expect that Madison Avenue will pump more capital into online video commercials packaged with professionally published content made available via the web.
But the coming growth of online video advertising represents only a small slice of the overall pie of multimedia marketing spending that is ultimately destined for the web. The real opportunity of Web 2.0 does not come from figuring out a way to use the web to re-create media structures that already exist. Granted, money will be generated from the sale of television-style advertising online. There’s nothing wrong with that. But if the online world simply becomes a place for re-purposing the marketing model already enabled by traditional television, then we—as an industry—will have failed miserably.
The true value in this market will be generated from the development of applications that uniquely utilize the capabilities of online multimedia technology. In the case of marketing applications, for instance, the web not only exposes your promotional content to more individuals, it also paves the way for letting you know exactly who spent time reviewing your marketing information.
At the very least, that’s how many companies are putting multimedia to work effectively today. In enterprise surveys conducted by Interactive Media Strategies, executives report that their organizations are more likely to make marketing-oriented content available to registered visitors to their website than to a visitor not providing identifying information. In short, companies that offer on–demand multimedia marketing material often know who is seeing their content. That’s something that completely differentiates the web from traditional TV advertising.
Over time, creative minds will come up with even more innovative ways to employ web multimedia in corporate marketing campaigns. Audio and video delivered online simply hold too much promise to be ignored by marketers looking for fresh, cost-effective venues for distributing their product messages to key target audiences.
Ultimately, business marketers will figure out how best to leverage the power of online multimedia. As seen in the broad use of registered access to multimedia, some are already on the path to figuring out the recipe for generating value. But until marketers survey the entire web promotion landscape, let’s try not to sell the whole medium short. Let’s remember to build our market into something more than a simple haven for time-shifted television.