Credit: Bon Appetit
Just two years ago, Bon Appétit, Conde Nast’s food lifestyle brand, had 34,000 YouTube subscribers. Now, they have over a million.According to a recent New York Times feature on Conde’s video adoption, this growth is in part the result of Conde Nast doubling down on their video production and evolving their strategy. Right now, video makes up a quarter of the revenue for The Lifestyle Collection which includes Bon Appétit, Architectural Digest, Epicurious, Conde Nast Traveler, and Self.
“In the next 24 months, I hope that video is half our business,” said Craig Kostelic, the chief business officer of The Lifestyle Collection. “It’s critical. It’s the macro trend of content consumption.”
For a traditional publisher that was a late adopter of digital, Conde Nast’s explosive growth appears to be the result of an structured approach to testing and iterating with a variety of different approaches. Without it, they would have struggled to stand out in a market that was already dominated by early adopters like Buzzfeed’s Tasty.
Bon Appétit first found major video success with with “hands and pans” cooking videos were around a minute long (the format was explored in-depth by the NYT last year — and the high popularity of these videos was confirmed in our previous analysis of emerging trends in branded video for 2018).
But lately, Conde Nast has been embracing mid-length videos and the flexibility they provide.
The new length has given them the creative freedom to try other narrative styles. For example, taste testing videos have done exceptionally well for Bon Appétit, and engage viewers more on YouTube — where their audience is predominantly under 34 years old and watches videos for over 5 minutes on average.
About half to two-thirds of Conde Nast’s revenue comes from pre-roll advertisements and sponsorships, where typically custom video content is created and distributed on Conde’s sites and social channels. But lately, more and more brands are coming to them for video creation only.
“Historically, you would have a digital media plan with a set amount of view or impressions,” Mr. Kostelic said. “More people are coming to us for our content and creative services plans, with distribution being a separate conversation.”
This has naturally led to Conde Nast creating videos for brands that aren’t promoted on their own platform, but rather are designed for distribution and re-use elsewhere. This moves Conde into territory typically occupied by agencies, which is not surprising — if you’ve developed a creative capability, why be limited to distribution on just your platform?
With such high watch times on YouTube, Conde Nast has found the sweet spot by building an engaged audience and ways to monetize video beyond just in-feed ads. The challenge for other video creators now is how they can do the same in a way that makes sense for their audience and brand.
Conde Nast isn’t the only brand flexing creative muscle with video.
Adidas is going to create 30,000 videos for a single campaign: One for each runner in the Boston marathon. It’s an ambitious project that is utilizing seven cameras, a 20-person crew to capture footage from around the course, and new technology to capture and make sense of the data. The personalized videos will be available within hours of the race.
Companies like Procter and Gamble, Johnson & Johnson, and Unilever are continuing to bring agency capabilities in-house, for both programmatic and content production and distribution. On the content side, these moves are designed for tighter turnarounds in the real-time social era where creating a video cut-down needs to take hours vs weeks or months.
In a bid to get people to become repeat viewers, brands are creating serialized digital content and experimenting with both releasing it all at once a la Netflix, as well as trying to create appointment viewing. Digiday has a good overview of how brands are trying to build a digital video audience beyond the newsfeed.
Publishers like Bustle, The Infatuation, and GQ are experimenting with episodic series on their Instagram Stories. They’re creating unique content, selling brands on sponsorship opportunities, and trying to convert an audience that expects on-demand content into one comfortable with appointment viewing.
38% of US Consumers think online ads should be shorter than TV Ads (only 7% think they should be longer).
YouTube is rolling out a new ad format for those trying to maximize reach. These ads are skippable, but brands are charged even if the user skips. The ads are designed for brands comfortable with buying ads the TV way.
Facebook Watch publishers are looking to monetize elsewhere in a bid to earn more and retain ownership of their content.
NBC is changing how it measures TV ad views. It has released a new impression-based metric called CFlight which will measure live, on-demand and time-shifted TV ad buys.
We found that the top 1 percent of content drives more than 90 percent of social referrals — making it important for you to identify content with the potential to jump into this top 1 percent and promote it. But — how much data and time do you need to be able to make these decisions that can generate outsized returns? We break it down here.
Credit: Time Out
When it comes to monetization, publishers are going their own way — no two strategies are alike. Where one uses video to deliver content instead of advertising, another turns to mobile apps to attract a younger audience.
This week Digiday had Time Out’s CEO, Julio Bruno, as a guest on their podcast. For him, video is just an afterthought and just a way to present content in a different format. As far as he is concerned, commerce and physical experience is core to a profitable media model for Time Out.
When he joined three years ago, Time Out was a publishing guide for cities with 38% of its revenue coming from print advertisements. Bruno knew they couldn’t survive on that alone. Under his leadership, the company created two divisions.
“One is Time Out Digital, which has print, digital and e-commerce. The other is Time Out Market, which is the physical representation and curation of Time Out. We opened a market in Lisbon [in Portugal]. There are several bars, restaurants and shops. They are the best in the city chosen by the editorial team. We are now opening in Miami, Chicago and other cities.”
Last year, the group drove 700,000 transactions, from restaurant reservations to tour bookings, and put on 250 live events while their e-commerce revenue grew by 57% and premium listings by 49%.
Publishers are doing their best to get the 18-24 age demographic to subscribe, but it seems like an uphill battle. They all agree that they need to foster a “paying for content” habit, but are less in agreement on how to accomplish that goal.
The Telegraph, Economist, and Financial Times are all trying different tactics to get millennials to pay for content.
In 2016, when The Telegraph put 20% of their content behind a paywall, their target audience were subscribers over 35 years old. Now however, 18-34 year old subscribers are their fastest growing segment, partially due to growth in usage of their mobile app, which was redesigned specifically for a younger audience.
The Economist has taken a different approach and targeted students through events in universities. Those who signed up for their events were then hit with ads about their subscription offers.
The Financial Times has been more ambitious in their bid to attract young readers and have made some long-term investments. They released a free-access-to-schools initiative and expanded it worldwide — because they believe students will be interested in FT’s content if it’s relevant to what they’re learning at school. In the UK alone, 16,000 students and 1500 teachers have unlimited access to FT.com, and schools in over 70 other countries have signed up too.
FT believes students with access to their brand are more likely to pay for a subscription when they’re no longer students. However — it’s too early to predict the success or failure of this initiative as it’s less than a year old.
Nick Ascheim, Senior Vice President of NBC News Digital, thinks publications should focus on loyalty instead of traffic for sustainable growth.
“Scale still seduces, but there is hope in something even more basic than big numbers: loyalty.”
He believes focusing on quality content and viewer experience will have a longer lasting impact on a publication’s growth than view counts.
It’s why NBC has made inspiring loyalty in their viewers their primary goal and are optimizing to it in multiple ways. They now focus on measuring returning viewers instead of unique views, their video players are faster and have auto-play turned off, and they continuously try new storytelling techniques and are developing more diverse, digital-only content to reward customers.
“Now that the ad-only experiment has decidedly failed, quality information providers will be able to build strong businesses, and consumers will be better served than ever.”
Williams laid out his vision those week for world where most publications won’t be able to sell their own subscriptions. Similar to how the television and music industries work, hardly anyone wants to subscribe to their shows or bands individually. However, almost everyone wants to buy a subscription where they get most, if not all their favorite shows and music. It’s why Netflix, Hulu, and Amazon are doing so well. It’s also why Spotify went public with a $30B evaluation.
According to Williams, the future of publications looks similar — bundled subscriptions as part of individual packages.
“There won’t be a Spotify of publishing — with literally everything you want. But there will be a Netflix and Hulu and Amazon, etc. — each with a substantial amount of things you want. You might also have your superfan subscriptions (Patreon-based individuals), and your company-expensed subscriptions (The Information), but most consumers will have one or two of the big bundles.”
(For more on the economics of why this might come to pass, read venture capitalist Chris Dixon’s often-referenced take on bundling of media.)
When brands first started investing in digital media, agencies naturally took on a lot of the planning, buying, analytics, and programmatic execution, similar to the roles they’d played in traditional media.But some brands have been increasingly unhappy with the lack of control and transparency in digital. Last year, P&G cut $200 million in digital ad spend in order to re-evaluate their ad budget and weed out ineffective spending. They reinvested that money in areas with market reach (TV, radio, and ecommerce) and ended up increasing their reach by 10% — which is not all that surprising, and of course reach isn't the only media goal for P&G.
However, the results of these changes have helped P&G redefine how they work with agencies. The plan is to pull some planning and operational nuts and bolt items (such as programmatic buying and data infrastructure) in-house, while continuing to leverage agencies for hard-to-replicate creative capabilities.
P&G’s CMO, Marc Pritchard noted that “less than half of the agency resources are being spent on creative talent. We would like the majority to have something to do with creative output.”
Last week, P&G also put the media duties of their haircare line up for review. If their new agency model is any indication, things are going to change.
Some brands like P&G are realizing there are some distinct advantages at scale by controlling as much of the data and tech in-house as they can. Not only does it save them money by not having to pay additional margins for execution, but it can also makes them more efficient for certain real-time them tighter turnarounds and faster reaction times.
Matt Ryan, CEO of Roth Ryan Hayes, believes that marketers will bring more functions in-house in the next three to five years.
“Transactional capabilities, like programmatic, SEM and SEO, and simple data gathering, can easily be shifted in-house to give marketers more control and drive efficiencies. This means that agencies will have to work hard to recruit talent,” says Ryan.
However, this trend of in-housing of course doesn’t mean brands are going to in-house everything. In fact, what brands want looks like a return to the pre-digital model — where ad agencies provide valuable creative talent and do less easily replicated execution.
This also means that the type of content creation that agencies do on behalf of brands could shift — instead of running social media command centers on behalf of brands, agencies could double down on the creative ideation and execution of different content types, from long-form video to podcasts to VR experiences.
As says Nancy Hill, former 4A's president and CEO, said, "Let [marketers] bring in the commoditized stuff and then agencies can go back to bringing big ideas. Marketers want that big thinking and they're willing to pay for it."
Curated and published by Adam Orshan, Matt Levin, and Samar Owais in New York City.