FEATURE19 August 2011

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The way people watch video clips online is changing. Patrick Hourihan explains how Yahoo is helping advertisers get a handle on this fast-moving area.


Internet users are evolving into internet viewers. Billions of online videos are viewed everyday – many of them short-form clips of just a few minutes – including music videos, news reports, trailers, home videos of cats playing with boxes and all the bizarre productions the internet has provided an outlet for. Online short-form video has grown exponentially over the last three years, and is increasingly profitable – advertising revenues doubled in 2010.

But for media owners and advertisers there are still significant knowledge gaps regarding the hows and whys of short-form video viewing. Earlier this year Yahoo carried out a research project into this fast-changing marketplace. The aim was to gather the knowledge to talk effectively to advertisers about how to make their messages targeted, cost-efficient and relevant to consumers, while maximising their return on investment.

A complex world
There were several questions we wanted to answer to understand current and future behaviour. How do consumers really use short-form video? How does genre fit in? What role do different devices play as the use of smartphones increases? And what does this all mean for advertisers?

“There are still significant knowledge gaps regarding the hows and whys of short-form video viewing”

Short-form video is a rapidly changing market, so our desk research looked at emerging trends, current consumer attitudes, and imminent infrastructure developments. One thing was clear: decision-making and consumer behaviour here are very complex. Perhaps most obviously, short-form video exists in a range of guises. Understanding it means not only exploring how the nature of the content itself (genre, length, quality) affects consumption but also how environmental factors (time of day, day of week) affect user experience and behaviour patterns. The increasing amount of short-form video viewed on new platforms like mobile devices adds a further level of complexity.

Technologies like IPTV (multichannel TV through an internet connection) seem to be bringing online video content closer to traditional TV. But the plethora of different online environments in which short-form video can be consumed makes user engagement with advertising in this space a more complex story. Clickthrough rates are useful but they only tell
part of the story.

We were therefore faced with a number of methodological challenges – how could we explore behaviour over short-form video and the impact of advertising, given the likelihood of consumers overstating their aversion to ads? How could we achieve the depth of understanding we needed while also providing the volume of data that advertisers and media and ad planners require? The best solution seemed to be one that allowed real-time responses in as natural an environment as possible.

Watching the watchers
Seventy-five respondents took part in a two-stage video diary. The first stage required them to email researchers a link to any short-form video they watched. They told us when they had watched it, why and how it had made them feel. The second stage required participants to open a daily email containing a wall of links to short-form video clips. This allowed us to test several of the possible factors affecting their choice of clip, including length, title, genre and the number of other people who had watched it. Respondents were asked to say why they chose a clip, their perceived mood and their location.

Potential over-estimation of ad avoidance meant that looking at respondents’ perceptions of their own behaviour was not enough. The video diary was followed up by seven ethnographic sessions looking at how daily activities affected decisions around viewing short-form video. These sessions allowed us to explore the role played by daily routine and how short-form video viewing fits into people’s broader media consumption.

A quantitative study of 2,000 online video consumers added weight and detail to existing findings and allowed us to further explore behaviour and attitudes.

The initial findings gave us a clear picture of the current marketplace and a number of hypotheses to take forward. To complete the process, marketing research and strategy agency Sparkler, which Yahoo worked with on this project, brought together industry experts to consider some of these hypotheses. They explored issues ranging from the role of TV-based internet services to the personalisation of video content.

“The way we use different deviecs is changing the way we watch short-form video. While the vast majority was still watched on laptop and desktop computers, tablet PCs and mobile phones were rapidly gaining ground”

Moving pictures
People’s behaviour over short-form video was shown to mirror the behaviour seen in TV viewing. It seemed that the technological convergence uncovered in the desk research was at least partly reflected in the way consumers’ decision-making was driven by genre and their desire for high-quality content. At the same time there was broad agreement among our experts that short-form video offered advertisers the opportunity to complement rather than cannibalise TV content.

The greatest opportunities for advertisers were in multimedia. Underpinning this was the finding that those most receptive to advertising around short-form had a preference for higher-quality broadcast clips. For them this needed to mirror the quality of longer-form content from catch-up TV services.

Of those faced with the choice of re-living Susan Boyle’s first Britain’s Got Talent audition on either ITV Player (the broadcaster’s own streaming service) or by finding a recording posted by a viewer on YouTube, the majority picked the former on the grounds that it looked ‘official’ and because of its quality. In turn, content supported by advertising often improved perceptions of that content’s quality.

Trust played a role here too, with around 75% agreeing with the statement ‘It’s important to me that I trust the sites I watch videos on’ and almost 60% agreeing that it was important that clips come from ‘a recognised source or brand website’.

The way we use different devices is also changing the way we watch short-form video. While the vast majority of short-form was still watched on laptop and desktop computers, tablet PCs and mobile phones were rapidly gaining ground. In particular desktops seemed most likely to be used for seeking out specific content at the beginning of or during the working day, whereas videos viewed on laptops were often stumbled upon. The same was true with video watched via mobile, again largely concentrated at either the very beginning, or end of the day. Across the week, respondents’ consumption moved from a period of ‘checking’ or ‘catching up’ on a Monday morning (centred on news, sport and current affairs) to more relaxed consumption of entertainment content at the weekend (when they typically selected music videos, film trailers or short TV or comedy clips).

Among the key implications for advertisers were important findings on the role of clip length, ad relevance and genre. Against the backdrop of recent Yahoo research suggesting that a minimum of ten seconds’ video was required to maximise brand recall, viewers claimed that for short-form video twenty-two seconds was the ideal length of an ad, backing up ComScore data which put the actual average pre-roll ad in the UK at the same length.

As expected, the importance of ad relevance was confirmed qualitatively, with respondents saying they were more likely to interact when ads felt relevant to them and to the content they were watching. The industry experts warned that untargeted and irrelevant advertising could only jeopardise an advertiser’s relationship with the consumer.

Genre was also confirmed as a crucial factor in how consumers decide on short-form video choices. Most clearly, there seemed to be greater expectations of advertising around content like sport, news, lifestyle, cookery and travel. Within this, gender also played an important role. Music, comedy, news and film clips were shown to be equally popular with men and women alike, but there was a stark gender divide between science and technology on one hand and fashion and beauty on the other. Irrespective of genre, however, over half agreed that the volume of advertising around video content was acceptable. This figure was closer to 70% for genres like news and comedy.

Feeling the effects
The research has already had a positive effect – we know from conversations that we are having directly with our clients that findings of the research have influenced their decision to engage more seriously with online video inventory with Yahoo. The research is informing the type of video content we make available to our consumers and our advertisers so that it has as much impact as possible.

Patrick Hourihan is head of UK trade research at Yahoo. He joined in 2009, having previously worked for the BBC and Essential Research