Wible's Weekly - Targeted Advertising, Social Media Stats, and VOD Growth - Janney/MediaEntertainment

Targeted Advertising &#8211; Consumers appear to be less concerned with targeted advertising, according to a recent poll by Zogby Analytics. The study, which was commissioned by the Digital Advertising Alliance, found that only 4 percent of respondents were concerned about ad targeting, and 70% preferred that at least some ads be targeted. The majority of consumers (75%) in the survey prefer the ad-supported, free content online model and understand that ads make the content "free". The study comes at a time when the FTC reiterated its call for a universal Do Not Track mechanism, and certain Senators are planning a hearing on the issue in April.Social Media &#8211; Twitter is branching out into music and video. The company launched a separate music app which may incorporate technology from the recent acquisition of a music discovery service. Bloomberg also reported that Twitter is close to reaching partnerships with TV networks to bring high quality video content and advertising to the site. Twitter activity is already an important benchmark for social media engagement for TV programming, with Nielsen recently partnering with Twitter to measure this activity. The music and video actions start to paint a clearer picture of Twitter as a potential broader media platform, as it seeks to attract more advertising revenues, particularly in mobile. Separately, Twitter announced keyword ad targeting to drive Promoted Tweet ads based on what users tweet, in addition to existing parameters such as location, device, and gender.Video On Demand &#8211; Time spent viewing free video on demand grew 40% in 2012, according to a Rentrak report. The number of programs watched grew 29%, implying that viewers watched programs longer. Broadcasters were a beneficiary as time spent on their programming grew 60% (number of programs grew 47%). The free on demand is generally ad free, although its growing popularity might drive plans to monetize the inventory. A study in the UK concluded that VOD helps extend the reach of traditional TV by up to 1.33%. The study found that VOD increased brand awareness by 5.5% and helped to extend the life of a campaign after its stopped running on TV. We believe advertising on VOD could impact its value proposition vs. OTT and SVOD services that do not incorporate ads.Social Gaming &#8211; EA announced is it shutting down certain games on Facebook. The move concerns The Sims Social, SimCity Social and Pet Society, after the number of players and the amount of activity has dropped. Given the issues we have seen at ZNGA, this could be interpreted as another datapoint that social games are struggling, or that social gaming needs to be more tailored than adding social versions of existing games. However, FB statistics indicate that web game installs on Facebook are up 75% YoY, with March seeing over 250 million monthly players (vs. 235 million in October). More importantly, the number of paying players increased by 24% YoY.Online Video Advertising &#8211; Online video budgets are accelerating in the U.S., taking funds from TV and display advertising, according to a survey by Digiday and Adap.tv. Budgets increased by 53% YoY in 1Q13, vs. a 20% increase in 2012. Interestingly, most buyers (80%) indicated that online video was a complement to TV, despite 39% of respondents indicating that online video budget increases moved money away from TV. However, approximately 28% of the increase in online video buying was incremental growth. This could in part be driven by more brand advertisers using programmatic buying as they become more confident in the returns.Tony Wible joined Janney Montgomery Scott in 2008 and is a Managing Director covering the Media and Entertainment sector after spending the previous 10 years at Citigroup Investment Research&#8212;most recently covering the Broadcasting and Entertainment Services industries. Tony can be reached at twible@janney.com. Janney Montgomery Scott LLC, is a U.S. broker-dealer registered with the U.S. Securities and Exchange Commission and a member of the New York Stock Exchange, the Financial Industry Regulatory Authority and the Securities Investor Protection Corp. Disclosures may be reviewed at Wible's Weekly.Read all Tony's MediaBizBloggers commentaries at Wible's Weekly: Janney/MediaEntertainment .Check us out on Facebook at MediaBizBloggers.comFollow our Twitter updates @MediaBizBloggerThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaBizBloggers.com management or associated bloggers. MediaBizBloggers is an open thought leadership platform and readers may share their comments and opinions in response to all commentaries.

Wible's Weekly - Targeted Advertising, Social Media Stats, and VOD Growth - Janney/MediaEntertainment

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