Battle for News feed Ads

Major internet companies still generate significant revenues from advertising models. As the softening macroeconomic environment continues to affect overall ad budget sentiment, internet companies are embracing opportunities and challenges by adapting to changing dynamics.
battle-for-newsfeed-ads
Specifically, 2016 has been challenging for search advertising post the Zexi Wei incident in April and stepped-up regulatory policy on (more…)

Facebook’s Advertising & Video Platform – The RoadMap

Facebook Videos AdvertisingFacebook appears to continue to have strong momentum in its core business, has significant new opportunities in areas like video and payments, is beginning to commercialize other apps.

Facebook made several important announcements related to its Video initiatives, including i) it is upping the maximum video upload file size to 1.5G, which is enough to support video as long as 45 minutes (i.e., its first foray into longer form video content); ii) it is rolling out an embedded video player for third-party apps and sites, which increases the reach of videos off-network, provides new solutions to publishers/apps, and represents a new competitor to YouTube; iii) announced the availability of spherical videos on the News Feed; and iv) suggested that pre- and/or post-roll ads in videos could soon be available.

Facebook highlighted three key data points of its Video Platform: 1) 3bn videos per day, of which a low percentage are (more…)

Mobile Social Platforms – Instagram & WhatsApp to be Monetized by Facebook

Instagram-whatsapp-monetizationInstagram and WhatsApp’s large user base and high engagement levels suggest a large revenue potential for Facebook (FB).

Instagram is a mobile online photo sharing, video-sharing social network service that allows users to take photos and videos and share them on its platform. Given growing use of photo sharing, we see Instagram as a well-positioned as a social and mobile platform play, and a nice compliment to the Facebook audience given a younger demographic profile of the site.

Instagram has exceeded with 300mn MAUs expectations. Site activity is impressive with 70mn photos shared per day and 2.5bn daily likes. Globally, users spend over 20 minutes per day on Instagram, which sets the foundation for material advertising dollars. We see a $4bn+ revenue opportunity and potential valuation range for Instagram at $30bn – $37bn based on user and potential revenue comparisons to (more…)

Google’s Video / Display Advertising Metric & Road Ahead

Youtube Display Video AdsGoogle’s VP of Display and Video Advertising Products, Neal Mohan highlighted brand advertising as a growth opportunity for Google and YouTube as the centerpiece of that effort.

Mohan provided new metrics about YouTube, including: 1) it attracts over one billion users per month, 2) the amount of watch-time is growing 50% y/y, 3) the innovative TrueView skippable ad unit on YouTube is growing impressions nearly 75% y/y, 4) YouTube has more 18-34 year-olds than any cable channel, 5) YouTube payouts (rev share) to content creators grew by ~50% y/y in 2014, and 6) that there was over seven million hours of ad content on YouTube and last year four of the top 10 most viewed videos on YouTube were ads created by brands/their agencies. These data points (more…)

Impact of Internet Advertising on Agencies / Other Industries

Impact of Digital Advertising on Other IndustriesWe previously discussed on How Internet Advertising has Disrupted Traditional Marketing channels such as Paper / TV / Radio. Today, we’ll highlight the impact of Digital A&M on Agencies and other industries.

Impact on Media Owners
The move to online significantly lowers the barriers of entry for new potential competitors. Clearly, the most famous examples involve exciting tech-based start-ups — the Google’s, Facebook’s, Netflix’s of this world. We would also argue that the move by selected larger media conglomerates to own media channels in international markets (e.g. Discovery with Eurosport/SBS) is also perhaps a symptom of the same trend.

This is not a challenge for 100% ad funded media companies, but it is for those media companies that enjoy a dual stream of monetization in an analogue world, (e.g. print newspapers/magazines). For example, a regional newspaper may be able to defend a regional classified model online – this has (more…)

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