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Going
Native:
How Marketers Are Reinventing the
S
Online Video Advertising Experience




           in association with:
Contents
Summary................................................................................................................2

Foreword................................................................................................................3

Going Native........................................................................................................ 4

The Changing Face of Distribution ..............................................................5

The Power of Video..........................................................................................7

Heineken and 007..............................................................................................8

Honda Million Mile Joe and Monsters Calling Home............................. 9

Demand for Native Video..............................................................................10

Using Irreverence to Connect: K-Swiss and Kenny Powers............... 11

Indie Meets Social Media: The Beauty Inside......................................... 12

The Advantage of Alignment....................................................................... 13

Matching the Right Content to the Brand: JetBlue..............................14

Conclusion: The Future of the Market....................................................... 15

Methodology.......................................................................................................16
Summary
              Marketers are broadly expanding the types of online video content they are creating and are
              interested in syndicating their content in ways that get beyond industry-standard formats.
              “Native advertising” has emerged as the convergence between original brand video content
              and dramatically new approaches to distribution that ensure an ad matches the look and feel
              of a website and does not interrupt the viewing experience in the manner of a television com-
              mercial. While the term “native” ads has not fully caught on with marketing executives, the
              core elements of native ad types are favored by them, which suggests this market will grow
              as awareness increases.




2 | Going native
Foreword
Online advertising is in the midst of both a creative renais-     choice-based interaction and content-driven experiences.
sance and a severe attention deficit.                                  Although creating these native content experiences
    Online video typifies this digital paradox; there has been    requires a more thoughtful and customized execution
an explosion of original brand content that has redefined the     strategy (as compared with interruptive display ads), many
ways brands express themselves, as well as how they enter-        of the largest platforms have been first on board to adopt
tain and connect with their audiences. However, at the same       native advertising. This is a testament to the value of
time, interruptive distribution tactics are showing skip rates    this new medium. For example, the major platforms on
climbing at alarming rates, and traditional display ads are       the web—Facebook, YouTube, Twitter, Tumblr and
continuing to show paltry engagement metrics.                     WordPress—have universally adopted native advertising
    These signs indicate that we are at the beginning of          formats, and premium editorial publishers are prepping for
a new era of online advertising with brand content at its         an industry-wide native ad overhaul.
core. In a world where consumers are now in full control               The future of digital marketing is going to be native.
of their media, interruption and poor visual integration are      Advertising experiences like banners, boxes, buttons and
no longer viable branding tactics. Instead, it has become         pop-ups are permanently giving way to ad experiences that
imperative that branded content remains consistent with           are native to a publisher’s site. At the same time the creativ-
the user experience and visual design of a publisher’s site.      ity is evolving alongside the native medium. Together they
In response to this fundamental shift in media, a new wave        are producing a new, direct way for brands to connect and
of “native” advertising models that fit with today’s social,      entertain audiences across the web. With approximately $11
connected web experience is emerging.                             billion a year being spent on display ads, there is no better
    Native advertising is defined as ad strategies that allow     time for change than now.
brands to promote their content into the endemic experience
of a site in an integrated, non-interruptive way. The core        By Dan Greenberg,
attributes of native advertising are strong visual integration,   CEO and co-founder, Sharethrough




                                                                                                            Copyright © 2012 Forbes Insights | 3
Going Native
              Over the past decade, content marketing, specifically in
                                                                               Importance of brand video syndication
              the form of online video, has become a fundamental tool
                                                                               features
              for connecting with consumers. It has enabled companies
              to reach and engage audiences where they are spending            Look and feel: native versus standard
              increasing amounts of time.                                                                                  61%
                  Native video, a more recent phenomenon in this               Embedded within organic site versus in ad banners
              field that meshes in appearance—if not substance—with                                                        60%
              the overall feel of a publisher’s website, is achieving even
                                                                               Choice-based versus interruptive
              greater viewer engagement. Companies are deploying it as
                                                                                                                     53%
              they seek more effective ways to forge stronger ties to con-
              sumers. Defined broadly, native ad units are visually well       Standalone versus before, during or after other content
              integrated (ads match a website’s look and feel), choice-                                             52%

              based and content-driven (providing a content experience         Enables video sharing versus doesn’t enable video sharing
              for audiences, rather than just a standard commercial). The                                         48%
              terms “native video” and the wider umbrella of “native           Publisher sites: premium content versus not premium content
              advertising” are still referred to by different names, and                                       47%
              even interchangeably. This suggests that marketers have not
              settled on precise definitions of this trend.
                  When it comes to native advertising, however, two
              principles are clear:
              1.	 The content itself is the main event, no longer a side-
                  show that interferes with other programming. Through
                  humor, pathos or meaningful insights, the content aims
                  to create a more entertaining, engaging viewing expe-
                  rience. The end goal is that this improved experience
                  ref lects favorably on the brand and leads to stron-
                  ger long-term bonds with consumers—which in turn
                  may lead to larger, more enduring financial benefits.
                  Online video formats have enabled companies to push
                  beyond traditional advertising boundaries for length
                  and the nature of material they cover. Such flexibility
                  has enabled them to tell stories with the sort of fullness
                  that could not have been done through other formats.
              2.	 Content distribution has changed. There is no simple
                  formula or paint-by-numbers approach to publishing
                  content—as with, say, a banner ad. Rather, there is new
                  flexibility for presentation. What are the right propor-
                  tions for the video? Where should a company place a
                  video on a company’s web page and what visual ele-
                  ments of the site should the ad mimic? Companies can
                  determine more analytically which format will create
                  the best viewing experience. At the same time, brands
                  can be more precise about which websites will ensure
                  the widest viewership among the right audience.




4 | Going native
The changing face
of distribution
Sixty-one percent of senior marketing executives value           more publishers we bring on board, the more advertisers
the look and feel of native videos, which mimic site             invest in native. It ends up being a self-fulfilling prophecy
design and interaction, over that of standard video, where       because it will work so well that they’ll notice it and see its
the video player stands out as a separate advertising fea-       value just by being Internet users.”
ture. Interviewees from major companies and ad agencies              Marty St. George, senior vice president, marketing
echoed this opinion, pointing out that consumers are more        and commercial strategy, JetBlue, says that he foresees
inclined to view content that does not point them directly       increased usage of this more creative way of advertising.
toward a transaction, but rather catches their interest in       “Look at what a successful program looks like for display
an organic way. Indeed, 60% of executives also pointed           advertising,” says St. George, whose company has cre-
to the importance of organically                                                             ated video game shows, as well
embedding a video into a site’s                                                              as a more recent campaign tied to
content, rather than delivering it                                                           the current presidential election
in traditional ad banners that do
not connect to the page in a rel-
                                           “We’ve gone beyond                                (see sidebar, page 14). “If I have
                                                                                             a display ad that has a 2% click-
evant or meaningful way. This            the thought of interactive                          through rate, that’s a really good
leads consumers to think more                                                                display ad. I’ll spin that in a dif-
favorably about the brand that is           digital into creating                            ferent direction, which is if I had
providing the content.
    The shift to native video dis-
                                              our own digital                                a display ad that has 98% of peo-
                                                                                             ple that ignore it, that’s sort of
tribution dovetails with creative           content wholesale.”                              sitting there inert. I don’t think
strategies that focus on custom                                                              that’s success at all. When we
digital assets. In the past, online               —MARTY ST. GEORGE                          get digital video involved, we
video strategies centered largely                    SVP, Marketing and                      get significantly higher engage-
on the distribution of commercials                 Commercial Strategy,                      ment. We’ve gone beyond the
originally made for television, ret-                       JetBlue                           thought of interactive digital into
rofitted for distribution online.                                                            creating our own digital content
The end result was something that                                                            wholesale.”
didn’t fit the medium.                                                                            Survey respondents and inter-
    Sharethrough CEO Dan Greenberg says that native              viewees noted that marketing strategies now increasingly
advertising addresses viewing preferences that are increas-      use long-form and custom 15- to 30-second content made
ingly based on the quality of the content and ease of access.    specifically for the web, instead of repurposed commercials.
He believes that as brands, agencies and, most of all, the           “If I see an ad that promises to be funny or interest-
publishers of websites become more aware of its attributes,      ing, or promises to teach me something, on like BuzzFeed
usage will increase markedly. Indeed, click-through rates        or the Atlantic, and I click it, and they’re just trying to sell
on banner ads have been harder to come by, while skip            me on car insurance, I’m going to turn around and never
rates on pre-roll ads that precede online videos have been       click it again,” says Greenberg. “That’s an important facet
on the rise.                                                     of this market that is [prompting] brands to invest in con-
    “When you see a banner ad in the New York Times,             tent for the first time ever. That’s where this whole thing
you don’t think twice about it,” says Greenberg. “But if         starts. It stems from making content so good that people
you saw a news feed video that had a quick play video that       will not only want to watch it, but even want to share it.
expanded, that was native to the page, seeing it during day-     Most brands are thinking about production and engage-
to-day usage is going to change people’s perception. The         ment as opposed to interruption.”




                                                                                                            Copyright © 2012 Forbes Insights | 5
In other words, marketers      Heightening awareness may boost usage.
                                            are placing a higher priority          Content marketing such as native video has more in
                  “Consumption              on distributing their videos       common with short films, documentaries or the creative,
            has changed, and                in ways that do not interrupt      occasionally irreverent work on YouTube than with tradi-
                                            the user experience. This may      tional commercials or the banner ads that are predominant
         advertisers will have              account for the low use of pre-    in digital advertising. It is more nuanced, focused less on
         to continue to follow              roll video distribution tactics,   product messaging than on creating an experience that
         [consumers]. Quality               in which advertisements are        viewers want to repeat and share via social media. It calls to
                                            delivered online in a format       the consumer to be engaged, rather than “marketed to” as
            has become more                 similar to television commer-      a captive, passive audience.
               important now.”              cials. In addition, companies          Native video is meant to function as destination enter-
                                            are looking for ways to differ-    tainment, as marketers become increasingly reluctant to
                     —RON AMRAm             entiate their advertising from     “interrupt” the consumer experience. Its appeal for market-
              Senior Media Director,        the avalanche of material that     ers lies primarily in its emphasis on compelling storytelling
                       Heineken USA         exists online. But the progres-    and providing an opportunity to go more in-depth into a
                                            sion from television-like ads      message. A native ad’s length may extend over several min-
                                            to those designed specifically     utes or run in installments released over regular intervals. It
                                            for an online experience is        may sadden, amuse, shamelessly tug on heartstrings or even
            also a response to new consumer viewing habits. Television         feature a star performer in a signature role. Interestingly
            ads are increasingly ignored by consumers even when they’re        enough, particularly successful examples of content mar-
            shown on television, as intended. Nearly three in five con-        keting also generate their own coverage.
            sumers surveyed by Forbes Insights recently said they use              For example, Intel’s six-part Beauty Inside series this
            their DVR to skip ads.                                             summer sought to engage consumers with the possi-
                 “For me, this is the continuing evolution of advertis-        ble romance of an unlikely couple. A series of Honda ads
            ers trying to connect to consumers,” says Ron Amram,               offered surprise outcomes for dedicated owners of Honda
            senior media director for Heineken USA. “Consumption               cars. An episode in a Heineken campaign, timed to the
            has changed, and advertisers will have to continue to follow       opening of the latest James Bond movie, includes a cameo
            [consumers]. Quality has become more important now.”               by the present Bond, Daniel Craig.
                 All this suggests a potential for significant and rapid           Such videos are also typically easy to access via corpo-
            growth for native video. At the same time, however, a lack         rate websites as well as other sites that are likely to reach
            of awareness or understanding of the medium and its bene-          target audiences. They do not require viewers to click on
            fits among senior executives may be hampering this growth.         banners or barrage them with a hard sell. The product men-
                 Indeed, half of the senior marketing executives who said      tion may be minimal or occur subtly in the context of the
            that their organizations had no imminent plans to use native       story. In short, the goal may be a conversation or at least
            video couldn’t predict if this would change in the future.         holding a consumer’s interest in a format that feels less arti-
            This may reflect the newness of the medium or a lack of            ficial and more natural.
            understanding of its benefits for consumer engagement.




6 | Going native
The Power of Video
To say that online video has become a staple of the market-          Yet marketers also appear
er’s toolbox would be a significant understatement. More         to view branded video as
than half (54%) of senior marketing executives say that they     a way to create a stronger,        “It’s almost an osmosis
use online video, while 23% are planning to use it, nearly       more positive imprint in con-      effect of native ads. If you
70% of them within the next year.                                sumers’ minds that may help
     Companies see online video as an effective way to           marketers achieve larger,
                                                                                                    see it a few times, it will
spur higher degrees of brand awareness, retention and            long-term goals. “It’s almost      feel as if it’s everywhere,
loyalty. Seven in 10 respondents (68%) to the Forbes/            an osmosis effect of native        and it will hit your brain.”
Sharethrough survey said that a top objective was to             ads,” says Sharethrough’s
enhance brand awareness. Fifty-five percent of respon-           Greenberg. “If you see it a        —DAN GREENBERG
dents said branding was a goal of online video advertising,      few times, it will feel as if it’s CEO and co-founder,
while 43% pointed to bolstering customer retention and           everywhere, and it will hit        Sharethrough
loyalty as a leading objective.                                  your brain and register with
     These marketers view paid brand video as a particularly     you, as opposed to a banner
effective way to achieve these goals. Three in four respon-      ad, where the impression is
dents (75%) aim for a measurable brand lift (i.e., an increase   just a throwaway. “
in awareness and purchasing intent) as a result of their paid        Custom digital assets are the most popular type of
brand video syndication efforts. More than half of execu-        assets for digital video advertising. Senior marketing
tives (54%) seek a measurable gain in reach and frequency.       executives interviewed said they valued the flexibility
And one-third pointed to more active measures of engage-         afforded by custom content. Three in five executives sur-
ment, including sharing and buzz. Getting consumers to           veyed use custom digital assets in their video advertising;
talk and share more about a brand, more often and more           two in five (41%) use long-form digital assets (branded
proactively, are the name of the video game.                     content). In a sign that executives by and large recognize




Top objectives of current online video users                     Top media objectives considered while
                                                                 measuring paid brand video syndication
Awareness
                                           68%                   Brand lift (awareness, purchase intent, etc.)
                                                                                                                       75%
Branding
                                   55%                           Reach and frequency
                                                                                                       54%
Customer retention and loyalty
                            43%                                  Sharing (i.e., earned media generation) loyalty
                                                                                           33%
Brand affinity/advocacy
                    30%                                          Building buzz
                                                                                           33%
Customer acquisition
                 26%                                             Direct response goal
                                                                                     27%




                                                                                                                 Copyright © 2012 Forbes Insights | 7
the weakness of a television-to-digital video approach,             human-interest stories related to travel. The videos do
              just 28% still repurpose television commercials online.             not tout Expedia’s services to help people find airfares and
              Thus, long-form branded content has surpassed repur-                accommodations; in fact, the company is mentioned only
              posed TV assets on the web, a testament to the maturation           briefly in each video. The videos could function indepen-
              of the online video marketplace.                                    dently of the company’s website—and do. Implicit is the
                  For example, Expedia’s Find Your Understanding                  understanding that travel transforms lives and that Expedia
              series amounts to a video blog of quirky, often touching            can help you get where you want to go.
                                                                                      Similarly, as mentioned earlier, Honda uses its Honda
                                                                                  Loves You Back videos to underscore the sometimes
                                                                                  extraordinary bonds car owners have with their cars. In
              Types of video assets used for digital video                        one, the company features a Honda owner who has driven
              advertising                                                         his Accord sedan a million miles. In another, a young musi-
              Custom digital assets (15 or 30 seconds in length)
                                                                                  cal group living on a tight budget receives an unexpected
                                                        61%
                                                                                  prize for recording their music video in their Hondas. The
                                                                                  videos have generated millions of visits on video sharing
              Long-form digital assets (i.e., branded content)
                                                                                  and social media sites, creating a dialogue that had more to
                                           41%
                                                                                  do with the stories than the attributes of the cars. Moreover,
              30-second repurposed TV commercial                                  the videos have created a larger emotional investment in the
                                  28%                                             brand than a traditional commercial probably could.




              Heineken and 007

              Follow the consumer? Or use content to push the consumer in new directions? It’s an age-old
              dilemma in advertising. Heineken Senior Media Director Ron Amram says that his division of
              the 170-year-old beer manufacturer does a little bit of each.

              Amram says that he is always cognizant of the company’s             most recent installment intersects with the coming release of
              reputation as a producer of premium beer. It would not be           the next James Bond film, Skyfall. It features a handsome ev-
              true to the Heineken brand to push its advertising in wildly        eryman caught between the current Bond, Daniel Craig, and
              new directions too far afield from its established messaging.       sinister-looking villains. The segment ends with Bond skydiv-
              “Heineken is a global beer with a rich history, sold in 170 coun-   ing from a snow-covered trestle.
              tries. We refer to our target audience as a man of the world
              always looking to do new things.”                                   The ad differs from other Heineken ads in both length and
                                                                                  the type of content, and it amassed nearly 7 million views on
              Yet like many other companies, Heineken has had to find ways        Heineken YouTube channels. “Marketers are always trying to
              to reach consumers via social media. That has meant trying          push the envelope and push consumers into new places,” says
              new types of advertising, including long-form videos.               Amram. “I’m a little of both [pushing the envelope and following
                                                                                  the consumer]. It depends on the situation. If you don’t lead at
              Among its recent initiatives has been a multi-part series. The      some times, you don’t capture [consumers’] hearts and minds.”




8 | Going native
Honda Million Mile Joe and Monsters Calling Home


Honda owners are among the most loyal in the car industry.           Bender says that the biggest
They appreciate the Japanese automaker’s well-engineered,            obstacle was maintaining the
reasonably priced cars and are not shy about sharing their ad-       surprise. Had Joe learned           “We knew it was
miration online. “Weekly we get a lot of letters from our custom-    what was planned before-            going to be a challenge,
ers saying, ‘Hey, thank you so much for making a highly reliable     hand, his reactions might not
car,’ or people who have been in collisions, saying, the safety of   have been so poignant and
                                                                                                         keeping the surprise
your product helped save our lives, minimize injuries, things like   engaging. “Honda saw right          and keeping the secret.”
that,” says John Watts, senior manager of digital marketing for      off the bat the possible emo-
Honda USA. “Our customers really appreciate what we do, and          tional connection that could        —BRETT BENDER
we wanted to show them how we appreciate them.”                      be put together between             Senior Vice President and
                                                                     consumers and Honda with a          Group Account Director,
Several years ago, the close relationship became the basis of        video of this nature,” Bender       RPA
Honda USA’s Facebook and social media strategy. The com-             says. “Pulling it off was some-
pany built an initial Honda Loves You Back campaign on the           thing. We knew it was going
concept popularized more than a decade ago by the movie              to be a challenge, keeping the
Six Degrees of Separation: Everyone knows someone who                surprise and keeping the secret.”
directly or indirectly leads to someone famous. In Honda’s
case, Watts says the company created a Facebook appli-               Emboldened by the success of Million Mile Joe, Honda and RPA
cation in which anyone could find somebody who “loves a              took a similar approach this year with a very different story,
Honda or knows somebody” who does. This promotion led to             albeit one in which a pleasant surprise was also the basis for
others in which Honda rewarded its customers: free parking           connecting with viewers. Affectionately called Best Gig Ever
for Honda owners at Anaheim Ducks hockey games (at the               by some, the four-minute online video focuses on a day in the
team’s Honda Center arena), massages and food giveaways              life of the indie band Monsters Calling Home. The group had
at car washes. Honda videoed the reactions of the beneficia-         drawn Honda’s notice by recording a music video in their Hon-
ries and posted them.                                                das. Honda surprised the band by arranging an appearance on
                                                                     the nationally televised Jimmy Kimmel Show.
When the Honda Facebook page reached 1 million followers,
the company celebrated by posting Honda-related photos               This second video also went viral. It hit its goal for impres-
from its fans’ Facebook pages and upped its efforts to find          sions within five days, well ahead of schedule. The video had
unique stories of Honda affection. That led them to a Maine          received more than 1.3 million views on YouTube by October
Honda owner, Joe, who had just reached 1 million miles on his        2012. “We went well above what we had targeted ahead of
Accord sedan odometer.                                               time,” Bender says.


Honda and the ad agency, Los Angeles-based RPA, believed             Watts, a 25-year Honda veteran, says companies have had to
the story of Million Mile Joe would resonate loudly both in-         become more flexible about the types of advertising they use,
side and outside the Honda community. Yet RPA Senior Vice            and the steep growth of digital has presented new options.
President and Group Account Director Brett Bender says that
traditional short-form video or television commercial formats        But a mix is still important to maintain. Even as it develops
would not enable Honda to tell the full story.                       these longer online videos, Honda continues to produce
                                                                     shorter videos and other types of advertising. “I think that a
RPA writers suggested a plot in which Honda would throw a            four- to five-minute format doesn’t work well for everything.
surprise parade for Joe in his hometown and award him with           But in this case (Monsters Calling Home), if you’re building a
a new Accord. The more than three-minute piece, which cap-           story and you want to really engage people, a four-minute for-
tured Joe’s astonishment as floats, stilt-walkers, cheerleaders      mat worked very, very well,” Watts says. “Obviously, there are
and a marching band roll by, quickly went viral and made na-         other situations where we didn’t have five minutes of content
tional news. “We surprised him,” says Bender. “He thought that       to keep people engaged, so it’s kind of a case-by-case (basis).
he was coming to a press conference.”                                But content is definitely key.”




                                                                                                               Copyright © 2012 Forbes Insights | 9
Demand for Native Video
              Owned media channels and banner ads are the most popular ways of distributing online vid-
              eos. Half of senior marketing executives report using these tactics.


              Yet numbers can be deceiving; they do not reflect the
                                                                              Top media distribution tactics for brand
              demand for this type of product. The level of demand is
                                                                              videos
              clear in the high percentage of marketers indicating the
              importance of a native look and feel to online video.           Owned media channels (corporate website, YouTube channel,
              Indeed, marketers know they must meet consumers on their        Facebook brand channel)
              turf; that is, they must provide content in a way that will                                         51%

              gain and maintain their attention without feeling intrusive,    Video display banner ads
              inauthentic or one-way.                                                                             51%
                  A majority of marketing executives value the attributes
                                                                              PR outreach	
              of native video. To be sure, just one-third (32%) of senior
                                                                                                        34%
              marketing executives say they have either bought or are
              planning to buy native video advertising of brand videos.       Native advertising
                                                                                               23%
              But in qualitative interviews for this paper, respondents
              indicated a greater receptivity to the format.                  Pre-roll or in stream advertising
                                                                                             19%

                                                                              Viral video syndication
                                                                                       11%




              Have you bought native video advertising for distribution of your brand videos?




                                                             12%
                                             20%


                                                                                             	Yes	
                                                                        18%                  	 but we are planning to do so
                                                                                             No,
                                                                                             	 and we have no imminent plans to do so
                                                                                             No,
                                                                                             	 on’t know
                                                                                             D



                                             49%




10 | Going native
Using Irreverence to Connect: K-Swiss and Kenny Powers


Because there are fewer boundaries to heed in content and delivery, content marketing in the
form of native video can take chances that other types of advertising cannot. In some cases,
online video may offer unprecedented opportunities for companies to redefine their brands.

Take K-Swiss’s series of irreverent videos featuring the ficti-     gueur in each part of the series,
tious cable television character Kenny Powers. The washed-up        and Powers is not shy about
baseball player in the HBO comedy Eastbound  Down, played          insulting athletes who make           “If you do something
by the comic actor Danny McBride, earned a loyal following          cameo appearances: kickbox-           that’s exciting and
among younger men for his fast-talking, vulgar persona. The         ers, football players, wrestlers
character of Powers says what is on his mind, no matter how         and celebrity personal trainer
                                                                                                          relevant, you can far
politically incorrect.                                              Jillian Michaels. The content is      expand your media
                                                                    not for shrinking violets.            spend in terms of
K-Swiss has largely been known for its comfortable, well-built
tennis sneakers. In 2010, it was looking for a way to add flash     The videos shocked some but
                                                                                                          its impact.”
to its image and hook younger men, who compose a key de-            drew raves from others, includ-
                                                                                                        —MATT JARVIS
mographic in sneaker sales. The California-based company            ing critics of online video. The
                                                                                                        Partner and Chief
couldn’t spend as much on an ad campaign as larger competi-         series won three Golden Pencil
                                                                                                        Strategy Officer,
tors such as Adidas and Nike, so it needed to think differently     awards for excellence in ad-
                                                                                                        72andSunny
to generate new interest at a price it could afford. “We knew       vertising. As for K-Swiss, the
we wanted to connect with the 16- to 21-year old guy,” says         company’s president, David
Matt Jarvis, a partner and chief strategy officer for the K-Swiss   Nichols, told OnlineVideo.net
ad agency 72andSunny. “So we thought it was really important        in a June 2012 interview that he “would be the first to go on
that if K-Swiss didn’t have a brand personality or equity with      record to say” that the company “didn’t sell as many shoes
that audience, that we connected with the audience in a way         as we would have liked.” But Nichols added that, “We did get
that was more peer-to-peer and was speaking their language,         more people talking about us…we increased our search rank-
connecting in a way that was relevant to them.”                     ing, hits to our website and increased sales. We did this with
                                                                    effective media buys. We were able to reach people without
Sneaker companies typically align themselves with athletes to       having to pay for television time.”
build brand awareness. But in its research, 72andSunny found
that the type of consumer that K-Swiss was trying to reach          By changing the brand image, this type of attention can lead
spent more time on such content-sharing sites as Break.com          to more sustainable future growth. “For a long time in the mar-
and Funnyordie.com than watching sports. “For K-Swiss to            keting world, entertainment value was considered by many
kind of take a page out of the traditional marketing playbook, it   agencies and marketers as a nice to have,” Jarvis says. “In this
was almost guaranteed to fail from the outset because it would      era, its feast or famine. If you’re not relevant and if you’re not
just be spending less money against a plan that everyone was        making it worth somebody’s while, you can spend hundreds
using,” Jarvis says.                                                of millions of dollars and people can completely ignore you.
                                                                    But conversely, if you do something that’s really exciting and
The agency suggested that an edgy approach featuring Mc-            relevant, you can just absolutely far expand what your media
Bride as Powers would draw the sort of consumers it would           spend is in terms of its impact in the marketplace. Creativity
need to create buzz and increase sales. In a series of videos,      is a great amplifier.”
some clocking in at more than four minutes, Powers extols the
virtues of K-Swiss sneakers while taking over as the company’s      72andSunny Creative Director Matt Murphy said in the same On-
CEO (he renames the position in a vulgar way). In a separate        lineVideo.net article that firms have to be willing to take chances
installment, he holds a product presentation on stage in a way      but also know what the right format for them is. “Don’t follow
that mocks former Apple CEO Steve Jobs’s well-known ap-             trends,” Murphy said. “Figure out what the DNA of your brand
proach – complete with Jobsian turtleneck. Profanity is de ri-      is and what’s right and true about your company.”




                                                                                                                Copyright © 2012 Forbes Insights | 11
Indie Meets Social Media: The Beauty Inside


              At the other end of the content spectrum from Kenny Powers is Intel’s romantic series The
              Beauty Inside. The 40-minute film, which was released earlier in 2012 in six installments, mar-
              ries independent filmmaking, social media and advertising. Intel Co-Marketing Manager Billie
              Goldman calls the genre “social film.”


                                               The title is a reference to Intel    The Beauty Inside generated more than 66 million views by
                                               parts, which are never seen          October 2012, along with approximately 8,400 Twitter follow-
      “We think that we’ve                     but, in Intel’s estimation, serve    ers and 95,000 Facebook fans.
      found a new form of                      as the “brains” and “heart” of
                                               many computers. However,             “To me the engagement was all the people who were interact-
 entertainment,” Goldman                       mention of the Intel and Toshi-      ing on Facebook, the hundreds and hundreds and hundreds
  says. “It all comes down                     ba brands occurs only briefly        of comments you saw,” says Goldman. “Each post that Alex
    to the concept and the                     at the beginning and end of          would make, the comments that would go back and forth. To
                                               each segment.                        me that’s what I’m looking for. It showed how engaged the
   talent that’s involved in                                                        audience was.”
               the concept.”                    The Beauty Inside uses an in-
                                                dependent film director, D.J.       The Beauty Inside was Intel/Toshiba’s second foray into social
                 —BILLIE GOLDMAN                Caruso, whose previous credits      film. The companies released a program called “Inside Experi-
              Co-Marketing Manager,             include the feature film Distur-    ence” in 2011. The 11-day campaign followed a young woman’s
                                     Intel      bia. The project is an ongoing      attempts to escape from the room in which she’d been impris-
                                                film where the audience can         oned. Her only connection to the outside world is a Toshiba
                                                participate, even potentially       laptop through which she contacts friends and family via social
                                                playing the main role. Topher       media. The series drew roughly 50 million views.
              Grace, best known for his role in the Spider-Man films, narrates
              the series as the mind and heart of Alex, an antiques restorer        Emboldened by the success of “Inside Experience,” Goldman
              looking for love. The unexpected trick is that Alex wakes up          wanted “to create a campaign that was as long as you could
              each morning as a different person: a pudgy slacker one day,          possibly make it and still keep the audience.” She says that
              an older man the next and so on—different genders, ages and           old-style formats limited by time and the type of content that
              ethnicities. In each installment, Alex is played by a different un-   brands can show will no longer grab viewers. To engage con-
              known individual—each of whom was cast via online auditions.          sumes, they will have to continue to think more creatively. “We
              The idea is that, while Alex may change on the outside, he            think that we’ve found a new form of entertainment,” Goldman
              remains the same underneath. Viewers who “like” a particular          says. “It all comes down to the concept and the talent that’s
              installment could then learn about the next episodes or sign          involved in the concept.”
              up to audition to play Alex in future installments. Members of
              the audience could also comment on the plot or “talk” directly
              to Alex on the campaign’s Facebook wall.




12 | Going native
The Advantage of
Alignment
Because a viewing experience organically          Most valuable attributes of online video
and unobtrusively intertwined with a site’s       Delivery among brand-safe content
content is the hallmark of content marketing                                                     65%

                                                  Alignment with premium site content
in general and native video in particular, it’s                                             60%

understandable that marketing executives          Delivery as choice-based

want their brands “intertwined” with content                                               57%

                                                  Custom integration within site look and feel
they want the brand to be associated with.                                           51%

Thus, alignment with premium site content         Ability to drive sharing
                                                                                  46%
is seen by marketing executives as among
the most valuable attributes of online video,
at 60%. Likewise, marketing executives also
point to video delivery among brand-safe
content as adding significant value to their
brand, at 65%.




                                                                                                 Copyright © 2012 Forbes Insights | 13
Matching the Right Content to the Brand: JetBlue


              Five years ago, JetBlue developed a campaign tied to the opening of The Simpsons
              movie, portraying itself as the official airline of Springfield, the fictional hometown of the
              cartoon family.

                                      But JetBlue’s Marty St. George             perfect to highlight their brand. The lesson we took from that
                                      says the initiative didn’t gener-          was: if we’re going to do tie-ins like this, they’ve got to really
    “Content has to get at            ate as much buzz as the com-               fit into what we do.”
what the brand is about. If           pany had hoped; the content
                                      didn’t tie closely enough to               In June 2012, JetBlue created “Get Away With It,” a game
 we’re going to do tie-ins,           JetBlue’s business. St. George,            show-themed campaign highlighting the company’s Getaways
   they’ve got to really fit          who held a less senior market-             vacation packages. The show ran in roughly 15-minute install-
        into what we do.”             ing position at the company                ments live-streamed over five days. Contestants answered
                                      then, saw the more successful              travel-related questions via Skype, while viewers could learn
        —MARTY ST. GEORGE             approach in another movie-                 how to become a contestant on the JetBlue website, which
            SVP, Marketing and        related campaign by 7Eleven,               also linked directly to the shows. “If you made it through 12
          Commercial Strategy,        which remade several stores                minutes of that video, you learned an awful lot about JetBlue
                         JetBlue      into the Kwik-E-Mart conve-                Getaways and about JetBlue,” says St. George. “The good
                                      nience store featured in the               thing is that the shows are actually hilarious. So you not only
                                      cartoon series. “We had a nice             learned those things, but you actually had a good time, too.”
                                      one-day story, but the cam-
        paign didn’t really get at what we do the way the 7Eleven                Most recently, the company has been running an Election Pro-
        campaign did,” St. George says. “Content has to get at what              tection campaign in which it promises to give free internation-
        the brand is about.”                                                     al, round-trip tickets to about 1,000 customers who voted for
                                                                                 the losing presidential candidate. The initiative connects airline
              JetBlue learned from the experience and continued to look for      travel with the fall’s most significant current event, and calls at-
              inventive ways to market itself. Since its launch in 2001, the     tention to JetBlue’s international business, an area it’s focusing
              company’s unique style and identity have enabled it to stand       on and looking to grow. JetBlue’s agency, Boston-based Mul-
              out in a crowded marketplace—and to compensate for market-         len, found an obvious link between the two: the mock threat
              ing budgets that St. George estimates to be as much as six to      to leave the country if a candidate loses.
              10 times smaller than those of competitors.
                                                                                 “They came back with one of those core insights of how air
              The airline was an early proponent of digital advertising and      travel and presidential elections tie to each other,” St. George
              now focuses more than half its marketing budget in this area.      says. “That was perfect for us. Historically, we didn’t fly any
              Some of its more successful, recent campaigns have linked pro-     international services as a company; we’re now flying to 21
              motions and deals to current events in clever, unexpected ways.    different international destinations from New York. It’s one of
                                                                                 the things that we could get across. The second thing is [that]
              “When I saw 7Eleven do that I said, ‘You know what? These          it shows that brand personality that we’re always trying to get
              guys did it right. We did it wrong,’” St. George says. “Official   across to our customers. This fit it perfectly because it was one
              airline of Springfield is cool, but it doesn’t really get at the   of those things where the minute you hear it, you’re like, ‘Oh
              core of what we do. It’s not like the Simpsons are flying around   my God, that’s so brilliant!’”
              all the time. What 7Eleven did, highlighting Kwik-E-Mart, was




14 | Going native
Conclusion: The Future
of the Market
As marketers’ understanding of what engages consumers online—and what leaves them
cold—evolves, some marketers are opting for online video approaches that are less a ret-
rofitting of television ads and more story-based, relevant and easily accessible content that
is a destination, not interruptive. Indeed, advertisers are clearly thinking about online video
distribution very differently from television. More than half (57%) found that delivering their
videos as choice-based, rather than interruptive, was one of the most valuable attributes of
online video.

Advertisers already appear to recognize the power and               Half of survey respondents who don’t yet use native
potential reach of this type of approach to digital video;     video said that they didn’t know if they would consider
23% of executives said that native video has become a top      native advertising in the future. As awareness of its ben-
media distribution tactic. As well, more than half of adver-   efits increases and more brands find success with native ad
tisers (61%) validated the importance of a native look and     options, the uncertainty will diminish.
feel for their ads rather than a standard ad placement. This        The disconnect between those currently using native
suggests that demand for native advertising in the near        ads and those who value its very advantages suggests that,
future will rise significantly. There’s clearly ample room     once awareness of native advertising increases, so too will
for such growth.                                               the number of brands that deploy it.




                                                                                                     Copyright © 2012 Forbes Insights | 15
Methodology
              The Forbes Insights/Sharethrough survey tapped 136 marketing executives. Forty-six respon-
              dents came from companies with revenues between $500 million and $1 billion, and the rest
              from companies with revenues of $1 billion-plus. Fifty-nine survey respondents had titles of
              director and up. Roughly half described their business outlook in positive terms, and about
              two in three said that their media budgets were at least $1 million. The vast majority (99%)
              are located in the United States.




                    Acknowledgments

                    Forbes Insights would like to thank the following individuals for contributing their thoughts to this report:


                    Marty St. George, SVP, Marketing and Commercial Strategy, JetBlue; Ron Amram, Senior Media Director, Heineken USA;
                    John Watts, Senior Manager of Digital Marketing, Honda USA; Brett Bender, Senior Vice President and Group Account
                    Director, RPA; Billie Goldman, Co-Marketing Manager, Intel; Matt Jarvis, Partner and Chief Strategy Officer, 72andSunny.




16 | Going native
About
Forbes Insights
Forbes Insights is the strategic
research practice of Forbes Media,
publisher of Forbes magazine
and Forbes.com. Taking advantage
of a proprietary database of
senior-level executives in the
Forbes community, Forbes Insights’
research covers a wide range of
vital business issues, including:
talent management; marketing;
financial benchmarking; risk
and regulation; small/midsize
business; and more.


Bruce Rogers
Chief Insights Officer


Brenna Sniderman
Senior Director


Christiaan Rizy
Director


Kasia Moreno
Editorial Director


James Peter Rubin
Report Author


Harold Velarde
designer




           60 Fifth Avenue, New York, NY 10011 | 212.366.8890 | www.forbes.com/forbesinsights

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Forbes insights sharethrough goingnative

  • 1. Going Native: How Marketers Are Reinventing the S Online Video Advertising Experience in association with:
  • 2. Contents Summary................................................................................................................2 Foreword................................................................................................................3 Going Native........................................................................................................ 4 The Changing Face of Distribution ..............................................................5 The Power of Video..........................................................................................7 Heineken and 007..............................................................................................8 Honda Million Mile Joe and Monsters Calling Home............................. 9 Demand for Native Video..............................................................................10 Using Irreverence to Connect: K-Swiss and Kenny Powers............... 11 Indie Meets Social Media: The Beauty Inside......................................... 12 The Advantage of Alignment....................................................................... 13 Matching the Right Content to the Brand: JetBlue..............................14 Conclusion: The Future of the Market....................................................... 15 Methodology.......................................................................................................16
  • 3. Summary Marketers are broadly expanding the types of online video content they are creating and are interested in syndicating their content in ways that get beyond industry-standard formats. “Native advertising” has emerged as the convergence between original brand video content and dramatically new approaches to distribution that ensure an ad matches the look and feel of a website and does not interrupt the viewing experience in the manner of a television com- mercial. While the term “native” ads has not fully caught on with marketing executives, the core elements of native ad types are favored by them, which suggests this market will grow as awareness increases. 2 | Going native
  • 4. Foreword Online advertising is in the midst of both a creative renais- choice-based interaction and content-driven experiences. sance and a severe attention deficit. Although creating these native content experiences Online video typifies this digital paradox; there has been requires a more thoughtful and customized execution an explosion of original brand content that has redefined the strategy (as compared with interruptive display ads), many ways brands express themselves, as well as how they enter- of the largest platforms have been first on board to adopt tain and connect with their audiences. However, at the same native advertising. This is a testament to the value of time, interruptive distribution tactics are showing skip rates this new medium. For example, the major platforms on climbing at alarming rates, and traditional display ads are the web—Facebook, YouTube, Twitter, Tumblr and continuing to show paltry engagement metrics. WordPress—have universally adopted native advertising These signs indicate that we are at the beginning of formats, and premium editorial publishers are prepping for a new era of online advertising with brand content at its an industry-wide native ad overhaul. core. In a world where consumers are now in full control The future of digital marketing is going to be native. of their media, interruption and poor visual integration are Advertising experiences like banners, boxes, buttons and no longer viable branding tactics. Instead, it has become pop-ups are permanently giving way to ad experiences that imperative that branded content remains consistent with are native to a publisher’s site. At the same time the creativ- the user experience and visual design of a publisher’s site. ity is evolving alongside the native medium. Together they In response to this fundamental shift in media, a new wave are producing a new, direct way for brands to connect and of “native” advertising models that fit with today’s social, entertain audiences across the web. With approximately $11 connected web experience is emerging. billion a year being spent on display ads, there is no better Native advertising is defined as ad strategies that allow time for change than now. brands to promote their content into the endemic experience of a site in an integrated, non-interruptive way. The core By Dan Greenberg, attributes of native advertising are strong visual integration, CEO and co-founder, Sharethrough Copyright © 2012 Forbes Insights | 3
  • 5. Going Native Over the past decade, content marketing, specifically in Importance of brand video syndication the form of online video, has become a fundamental tool features for connecting with consumers. It has enabled companies to reach and engage audiences where they are spending Look and feel: native versus standard increasing amounts of time. 61% Native video, a more recent phenomenon in this Embedded within organic site versus in ad banners field that meshes in appearance—if not substance—with 60% the overall feel of a publisher’s website, is achieving even Choice-based versus interruptive greater viewer engagement. Companies are deploying it as 53% they seek more effective ways to forge stronger ties to con- sumers. Defined broadly, native ad units are visually well Standalone versus before, during or after other content integrated (ads match a website’s look and feel), choice- 52% based and content-driven (providing a content experience Enables video sharing versus doesn’t enable video sharing for audiences, rather than just a standard commercial). The 48% terms “native video” and the wider umbrella of “native Publisher sites: premium content versus not premium content advertising” are still referred to by different names, and 47% even interchangeably. This suggests that marketers have not settled on precise definitions of this trend. When it comes to native advertising, however, two principles are clear: 1. The content itself is the main event, no longer a side- show that interferes with other programming. Through humor, pathos or meaningful insights, the content aims to create a more entertaining, engaging viewing expe- rience. The end goal is that this improved experience ref lects favorably on the brand and leads to stron- ger long-term bonds with consumers—which in turn may lead to larger, more enduring financial benefits. Online video formats have enabled companies to push beyond traditional advertising boundaries for length and the nature of material they cover. Such flexibility has enabled them to tell stories with the sort of fullness that could not have been done through other formats. 2. Content distribution has changed. There is no simple formula or paint-by-numbers approach to publishing content—as with, say, a banner ad. Rather, there is new flexibility for presentation. What are the right propor- tions for the video? Where should a company place a video on a company’s web page and what visual ele- ments of the site should the ad mimic? Companies can determine more analytically which format will create the best viewing experience. At the same time, brands can be more precise about which websites will ensure the widest viewership among the right audience. 4 | Going native
  • 6. The changing face of distribution Sixty-one percent of senior marketing executives value more publishers we bring on board, the more advertisers the look and feel of native videos, which mimic site invest in native. It ends up being a self-fulfilling prophecy design and interaction, over that of standard video, where because it will work so well that they’ll notice it and see its the video player stands out as a separate advertising fea- value just by being Internet users.” ture. Interviewees from major companies and ad agencies Marty St. George, senior vice president, marketing echoed this opinion, pointing out that consumers are more and commercial strategy, JetBlue, says that he foresees inclined to view content that does not point them directly increased usage of this more creative way of advertising. toward a transaction, but rather catches their interest in “Look at what a successful program looks like for display an organic way. Indeed, 60% of executives also pointed advertising,” says St. George, whose company has cre- to the importance of organically ated video game shows, as well embedding a video into a site’s as a more recent campaign tied to content, rather than delivering it the current presidential election in traditional ad banners that do not connect to the page in a rel- “We’ve gone beyond (see sidebar, page 14). “If I have a display ad that has a 2% click- evant or meaningful way. This the thought of interactive through rate, that’s a really good leads consumers to think more display ad. I’ll spin that in a dif- favorably about the brand that is digital into creating ferent direction, which is if I had providing the content. The shift to native video dis- our own digital a display ad that has 98% of peo- ple that ignore it, that’s sort of tribution dovetails with creative content wholesale.” sitting there inert. I don’t think strategies that focus on custom that’s success at all. When we digital assets. In the past, online —MARTY ST. GEORGE get digital video involved, we video strategies centered largely SVP, Marketing and get significantly higher engage- on the distribution of commercials Commercial Strategy, ment. We’ve gone beyond the originally made for television, ret- JetBlue thought of interactive digital into rofitted for distribution online. creating our own digital content The end result was something that wholesale.” didn’t fit the medium. Survey respondents and inter- Sharethrough CEO Dan Greenberg says that native viewees noted that marketing strategies now increasingly advertising addresses viewing preferences that are increas- use long-form and custom 15- to 30-second content made ingly based on the quality of the content and ease of access. specifically for the web, instead of repurposed commercials. He believes that as brands, agencies and, most of all, the “If I see an ad that promises to be funny or interest- publishers of websites become more aware of its attributes, ing, or promises to teach me something, on like BuzzFeed usage will increase markedly. Indeed, click-through rates or the Atlantic, and I click it, and they’re just trying to sell on banner ads have been harder to come by, while skip me on car insurance, I’m going to turn around and never rates on pre-roll ads that precede online videos have been click it again,” says Greenberg. “That’s an important facet on the rise. of this market that is [prompting] brands to invest in con- “When you see a banner ad in the New York Times, tent for the first time ever. That’s where this whole thing you don’t think twice about it,” says Greenberg. “But if starts. It stems from making content so good that people you saw a news feed video that had a quick play video that will not only want to watch it, but even want to share it. expanded, that was native to the page, seeing it during day- Most brands are thinking about production and engage- to-day usage is going to change people’s perception. The ment as opposed to interruption.” Copyright © 2012 Forbes Insights | 5
  • 7. In other words, marketers Heightening awareness may boost usage. are placing a higher priority Content marketing such as native video has more in “Consumption on distributing their videos common with short films, documentaries or the creative, has changed, and in ways that do not interrupt occasionally irreverent work on YouTube than with tradi- the user experience. This may tional commercials or the banner ads that are predominant advertisers will have account for the low use of pre- in digital advertising. It is more nuanced, focused less on to continue to follow roll video distribution tactics, product messaging than on creating an experience that [consumers]. Quality in which advertisements are viewers want to repeat and share via social media. It calls to delivered online in a format the consumer to be engaged, rather than “marketed to” as has become more similar to television commer- a captive, passive audience. important now.” cials. In addition, companies Native video is meant to function as destination enter- are looking for ways to differ- tainment, as marketers become increasingly reluctant to —RON AMRAm entiate their advertising from “interrupt” the consumer experience. Its appeal for market- Senior Media Director, the avalanche of material that ers lies primarily in its emphasis on compelling storytelling Heineken USA exists online. But the progres- and providing an opportunity to go more in-depth into a sion from television-like ads message. A native ad’s length may extend over several min- to those designed specifically utes or run in installments released over regular intervals. It for an online experience is may sadden, amuse, shamelessly tug on heartstrings or even also a response to new consumer viewing habits. Television feature a star performer in a signature role. Interestingly ads are increasingly ignored by consumers even when they’re enough, particularly successful examples of content mar- shown on television, as intended. Nearly three in five con- keting also generate their own coverage. sumers surveyed by Forbes Insights recently said they use For example, Intel’s six-part Beauty Inside series this their DVR to skip ads. summer sought to engage consumers with the possi- “For me, this is the continuing evolution of advertis- ble romance of an unlikely couple. A series of Honda ads ers trying to connect to consumers,” says Ron Amram, offered surprise outcomes for dedicated owners of Honda senior media director for Heineken USA. “Consumption cars. An episode in a Heineken campaign, timed to the has changed, and advertisers will have to continue to follow opening of the latest James Bond movie, includes a cameo [consumers]. Quality has become more important now.” by the present Bond, Daniel Craig. All this suggests a potential for significant and rapid Such videos are also typically easy to access via corpo- growth for native video. At the same time, however, a lack rate websites as well as other sites that are likely to reach of awareness or understanding of the medium and its bene- target audiences. They do not require viewers to click on fits among senior executives may be hampering this growth. banners or barrage them with a hard sell. The product men- Indeed, half of the senior marketing executives who said tion may be minimal or occur subtly in the context of the that their organizations had no imminent plans to use native story. In short, the goal may be a conversation or at least video couldn’t predict if this would change in the future. holding a consumer’s interest in a format that feels less arti- This may reflect the newness of the medium or a lack of ficial and more natural. understanding of its benefits for consumer engagement. 6 | Going native
  • 8. The Power of Video To say that online video has become a staple of the market- Yet marketers also appear er’s toolbox would be a significant understatement. More to view branded video as than half (54%) of senior marketing executives say that they a way to create a stronger, “It’s almost an osmosis use online video, while 23% are planning to use it, nearly more positive imprint in con- effect of native ads. If you 70% of them within the next year. sumers’ minds that may help Companies see online video as an effective way to marketers achieve larger, see it a few times, it will spur higher degrees of brand awareness, retention and long-term goals. “It’s almost feel as if it’s everywhere, loyalty. Seven in 10 respondents (68%) to the Forbes/ an osmosis effect of native and it will hit your brain.” Sharethrough survey said that a top objective was to ads,” says Sharethrough’s enhance brand awareness. Fifty-five percent of respon- Greenberg. “If you see it a —DAN GREENBERG dents said branding was a goal of online video advertising, few times, it will feel as if it’s CEO and co-founder, while 43% pointed to bolstering customer retention and everywhere, and it will hit Sharethrough loyalty as a leading objective. your brain and register with These marketers view paid brand video as a particularly you, as opposed to a banner effective way to achieve these goals. Three in four respon- ad, where the impression is dents (75%) aim for a measurable brand lift (i.e., an increase just a throwaway. “ in awareness and purchasing intent) as a result of their paid Custom digital assets are the most popular type of brand video syndication efforts. More than half of execu- assets for digital video advertising. Senior marketing tives (54%) seek a measurable gain in reach and frequency. executives interviewed said they valued the flexibility And one-third pointed to more active measures of engage- afforded by custom content. Three in five executives sur- ment, including sharing and buzz. Getting consumers to veyed use custom digital assets in their video advertising; talk and share more about a brand, more often and more two in five (41%) use long-form digital assets (branded proactively, are the name of the video game. content). In a sign that executives by and large recognize Top objectives of current online video users Top media objectives considered while measuring paid brand video syndication Awareness 68% Brand lift (awareness, purchase intent, etc.) 75% Branding 55% Reach and frequency 54% Customer retention and loyalty 43% Sharing (i.e., earned media generation) loyalty 33% Brand affinity/advocacy 30% Building buzz 33% Customer acquisition 26% Direct response goal 27% Copyright © 2012 Forbes Insights | 7
  • 9. the weakness of a television-to-digital video approach, human-interest stories related to travel. The videos do just 28% still repurpose television commercials online. not tout Expedia’s services to help people find airfares and Thus, long-form branded content has surpassed repur- accommodations; in fact, the company is mentioned only posed TV assets on the web, a testament to the maturation briefly in each video. The videos could function indepen- of the online video marketplace. dently of the company’s website—and do. Implicit is the For example, Expedia’s Find Your Understanding understanding that travel transforms lives and that Expedia series amounts to a video blog of quirky, often touching can help you get where you want to go. Similarly, as mentioned earlier, Honda uses its Honda Loves You Back videos to underscore the sometimes extraordinary bonds car owners have with their cars. In Types of video assets used for digital video one, the company features a Honda owner who has driven advertising his Accord sedan a million miles. In another, a young musi- Custom digital assets (15 or 30 seconds in length) cal group living on a tight budget receives an unexpected 61% prize for recording their music video in their Hondas. The videos have generated millions of visits on video sharing Long-form digital assets (i.e., branded content) and social media sites, creating a dialogue that had more to 41% do with the stories than the attributes of the cars. Moreover, 30-second repurposed TV commercial the videos have created a larger emotional investment in the 28% brand than a traditional commercial probably could. Heineken and 007 Follow the consumer? Or use content to push the consumer in new directions? It’s an age-old dilemma in advertising. Heineken Senior Media Director Ron Amram says that his division of the 170-year-old beer manufacturer does a little bit of each. Amram says that he is always cognizant of the company’s most recent installment intersects with the coming release of reputation as a producer of premium beer. It would not be the next James Bond film, Skyfall. It features a handsome ev- true to the Heineken brand to push its advertising in wildly eryman caught between the current Bond, Daniel Craig, and new directions too far afield from its established messaging. sinister-looking villains. The segment ends with Bond skydiv- “Heineken is a global beer with a rich history, sold in 170 coun- ing from a snow-covered trestle. tries. We refer to our target audience as a man of the world always looking to do new things.” The ad differs from other Heineken ads in both length and the type of content, and it amassed nearly 7 million views on Yet like many other companies, Heineken has had to find ways Heineken YouTube channels. “Marketers are always trying to to reach consumers via social media. That has meant trying push the envelope and push consumers into new places,” says new types of advertising, including long-form videos. Amram. “I’m a little of both [pushing the envelope and following the consumer]. It depends on the situation. If you don’t lead at Among its recent initiatives has been a multi-part series. The some times, you don’t capture [consumers’] hearts and minds.” 8 | Going native
  • 10. Honda Million Mile Joe and Monsters Calling Home Honda owners are among the most loyal in the car industry. Bender says that the biggest They appreciate the Japanese automaker’s well-engineered, obstacle was maintaining the reasonably priced cars and are not shy about sharing their ad- surprise. Had Joe learned “We knew it was miration online. “Weekly we get a lot of letters from our custom- what was planned before- going to be a challenge, ers saying, ‘Hey, thank you so much for making a highly reliable hand, his reactions might not car,’ or people who have been in collisions, saying, the safety of have been so poignant and keeping the surprise your product helped save our lives, minimize injuries, things like engaging. “Honda saw right and keeping the secret.” that,” says John Watts, senior manager of digital marketing for off the bat the possible emo- Honda USA. “Our customers really appreciate what we do, and tional connection that could —BRETT BENDER we wanted to show them how we appreciate them.” be put together between Senior Vice President and consumers and Honda with a Group Account Director, Several years ago, the close relationship became the basis of video of this nature,” Bender RPA Honda USA’s Facebook and social media strategy. The com- says. “Pulling it off was some- pany built an initial Honda Loves You Back campaign on the thing. We knew it was going concept popularized more than a decade ago by the movie to be a challenge, keeping the Six Degrees of Separation: Everyone knows someone who surprise and keeping the secret.” directly or indirectly leads to someone famous. In Honda’s case, Watts says the company created a Facebook appli- Emboldened by the success of Million Mile Joe, Honda and RPA cation in which anyone could find somebody who “loves a took a similar approach this year with a very different story, Honda or knows somebody” who does. This promotion led to albeit one in which a pleasant surprise was also the basis for others in which Honda rewarded its customers: free parking connecting with viewers. Affectionately called Best Gig Ever for Honda owners at Anaheim Ducks hockey games (at the by some, the four-minute online video focuses on a day in the team’s Honda Center arena), massages and food giveaways life of the indie band Monsters Calling Home. The group had at car washes. Honda videoed the reactions of the beneficia- drawn Honda’s notice by recording a music video in their Hon- ries and posted them. das. Honda surprised the band by arranging an appearance on the nationally televised Jimmy Kimmel Show. When the Honda Facebook page reached 1 million followers, the company celebrated by posting Honda-related photos This second video also went viral. It hit its goal for impres- from its fans’ Facebook pages and upped its efforts to find sions within five days, well ahead of schedule. The video had unique stories of Honda affection. That led them to a Maine received more than 1.3 million views on YouTube by October Honda owner, Joe, who had just reached 1 million miles on his 2012. “We went well above what we had targeted ahead of Accord sedan odometer. time,” Bender says. Honda and the ad agency, Los Angeles-based RPA, believed Watts, a 25-year Honda veteran, says companies have had to the story of Million Mile Joe would resonate loudly both in- become more flexible about the types of advertising they use, side and outside the Honda community. Yet RPA Senior Vice and the steep growth of digital has presented new options. President and Group Account Director Brett Bender says that traditional short-form video or television commercial formats But a mix is still important to maintain. Even as it develops would not enable Honda to tell the full story. these longer online videos, Honda continues to produce shorter videos and other types of advertising. “I think that a RPA writers suggested a plot in which Honda would throw a four- to five-minute format doesn’t work well for everything. surprise parade for Joe in his hometown and award him with But in this case (Monsters Calling Home), if you’re building a a new Accord. The more than three-minute piece, which cap- story and you want to really engage people, a four-minute for- tured Joe’s astonishment as floats, stilt-walkers, cheerleaders mat worked very, very well,” Watts says. “Obviously, there are and a marching band roll by, quickly went viral and made na- other situations where we didn’t have five minutes of content tional news. “We surprised him,” says Bender. “He thought that to keep people engaged, so it’s kind of a case-by-case (basis). he was coming to a press conference.” But content is definitely key.” Copyright © 2012 Forbes Insights | 9
  • 11. Demand for Native Video Owned media channels and banner ads are the most popular ways of distributing online vid- eos. Half of senior marketing executives report using these tactics. Yet numbers can be deceiving; they do not reflect the Top media distribution tactics for brand demand for this type of product. The level of demand is videos clear in the high percentage of marketers indicating the importance of a native look and feel to online video. Owned media channels (corporate website, YouTube channel, Indeed, marketers know they must meet consumers on their Facebook brand channel) turf; that is, they must provide content in a way that will 51% gain and maintain their attention without feeling intrusive, Video display banner ads inauthentic or one-way. 51% A majority of marketing executives value the attributes PR outreach of native video. To be sure, just one-third (32%) of senior 34% marketing executives say they have either bought or are planning to buy native video advertising of brand videos. Native advertising 23% But in qualitative interviews for this paper, respondents indicated a greater receptivity to the format. Pre-roll or in stream advertising 19% Viral video syndication 11% Have you bought native video advertising for distribution of your brand videos? 12% 20% Yes 18% but we are planning to do so No, and we have no imminent plans to do so No, on’t know D 49% 10 | Going native
  • 12. Using Irreverence to Connect: K-Swiss and Kenny Powers Because there are fewer boundaries to heed in content and delivery, content marketing in the form of native video can take chances that other types of advertising cannot. In some cases, online video may offer unprecedented opportunities for companies to redefine their brands. Take K-Swiss’s series of irreverent videos featuring the ficti- gueur in each part of the series, tious cable television character Kenny Powers. The washed-up and Powers is not shy about baseball player in the HBO comedy Eastbound Down, played insulting athletes who make “If you do something by the comic actor Danny McBride, earned a loyal following cameo appearances: kickbox- that’s exciting and among younger men for his fast-talking, vulgar persona. The ers, football players, wrestlers character of Powers says what is on his mind, no matter how and celebrity personal trainer relevant, you can far politically incorrect. Jillian Michaels. The content is expand your media not for shrinking violets. spend in terms of K-Swiss has largely been known for its comfortable, well-built tennis sneakers. In 2010, it was looking for a way to add flash The videos shocked some but its impact.” to its image and hook younger men, who compose a key de- drew raves from others, includ- —MATT JARVIS mographic in sneaker sales. The California-based company ing critics of online video. The Partner and Chief couldn’t spend as much on an ad campaign as larger competi- series won three Golden Pencil Strategy Officer, tors such as Adidas and Nike, so it needed to think differently awards for excellence in ad- 72andSunny to generate new interest at a price it could afford. “We knew vertising. As for K-Swiss, the we wanted to connect with the 16- to 21-year old guy,” says company’s president, David Matt Jarvis, a partner and chief strategy officer for the K-Swiss Nichols, told OnlineVideo.net ad agency 72andSunny. “So we thought it was really important in a June 2012 interview that he “would be the first to go on that if K-Swiss didn’t have a brand personality or equity with record to say” that the company “didn’t sell as many shoes that audience, that we connected with the audience in a way as we would have liked.” But Nichols added that, “We did get that was more peer-to-peer and was speaking their language, more people talking about us…we increased our search rank- connecting in a way that was relevant to them.” ing, hits to our website and increased sales. We did this with effective media buys. We were able to reach people without Sneaker companies typically align themselves with athletes to having to pay for television time.” build brand awareness. But in its research, 72andSunny found that the type of consumer that K-Swiss was trying to reach By changing the brand image, this type of attention can lead spent more time on such content-sharing sites as Break.com to more sustainable future growth. “For a long time in the mar- and Funnyordie.com than watching sports. “For K-Swiss to keting world, entertainment value was considered by many kind of take a page out of the traditional marketing playbook, it agencies and marketers as a nice to have,” Jarvis says. “In this was almost guaranteed to fail from the outset because it would era, its feast or famine. If you’re not relevant and if you’re not just be spending less money against a plan that everyone was making it worth somebody’s while, you can spend hundreds using,” Jarvis says. of millions of dollars and people can completely ignore you. But conversely, if you do something that’s really exciting and The agency suggested that an edgy approach featuring Mc- relevant, you can just absolutely far expand what your media Bride as Powers would draw the sort of consumers it would spend is in terms of its impact in the marketplace. Creativity need to create buzz and increase sales. In a series of videos, is a great amplifier.” some clocking in at more than four minutes, Powers extols the virtues of K-Swiss sneakers while taking over as the company’s 72andSunny Creative Director Matt Murphy said in the same On- CEO (he renames the position in a vulgar way). In a separate lineVideo.net article that firms have to be willing to take chances installment, he holds a product presentation on stage in a way but also know what the right format for them is. “Don’t follow that mocks former Apple CEO Steve Jobs’s well-known ap- trends,” Murphy said. “Figure out what the DNA of your brand proach – complete with Jobsian turtleneck. Profanity is de ri- is and what’s right and true about your company.” Copyright © 2012 Forbes Insights | 11
  • 13. Indie Meets Social Media: The Beauty Inside At the other end of the content spectrum from Kenny Powers is Intel’s romantic series The Beauty Inside. The 40-minute film, which was released earlier in 2012 in six installments, mar- ries independent filmmaking, social media and advertising. Intel Co-Marketing Manager Billie Goldman calls the genre “social film.” The title is a reference to Intel The Beauty Inside generated more than 66 million views by parts, which are never seen October 2012, along with approximately 8,400 Twitter follow- “We think that we’ve but, in Intel’s estimation, serve ers and 95,000 Facebook fans. found a new form of as the “brains” and “heart” of many computers. However, “To me the engagement was all the people who were interact- entertainment,” Goldman mention of the Intel and Toshi- ing on Facebook, the hundreds and hundreds and hundreds says. “It all comes down ba brands occurs only briefly of comments you saw,” says Goldman. “Each post that Alex to the concept and the at the beginning and end of would make, the comments that would go back and forth. To each segment. me that’s what I’m looking for. It showed how engaged the talent that’s involved in audience was.” the concept.” The Beauty Inside uses an in- dependent film director, D.J. The Beauty Inside was Intel/Toshiba’s second foray into social —BILLIE GOLDMAN Caruso, whose previous credits film. The companies released a program called “Inside Experi- Co-Marketing Manager, include the feature film Distur- ence” in 2011. The 11-day campaign followed a young woman’s Intel bia. The project is an ongoing attempts to escape from the room in which she’d been impris- film where the audience can oned. Her only connection to the outside world is a Toshiba participate, even potentially laptop through which she contacts friends and family via social playing the main role. Topher media. The series drew roughly 50 million views. Grace, best known for his role in the Spider-Man films, narrates the series as the mind and heart of Alex, an antiques restorer Emboldened by the success of “Inside Experience,” Goldman looking for love. The unexpected trick is that Alex wakes up wanted “to create a campaign that was as long as you could each morning as a different person: a pudgy slacker one day, possibly make it and still keep the audience.” She says that an older man the next and so on—different genders, ages and old-style formats limited by time and the type of content that ethnicities. In each installment, Alex is played by a different un- brands can show will no longer grab viewers. To engage con- known individual—each of whom was cast via online auditions. sumes, they will have to continue to think more creatively. “We The idea is that, while Alex may change on the outside, he think that we’ve found a new form of entertainment,” Goldman remains the same underneath. Viewers who “like” a particular says. “It all comes down to the concept and the talent that’s installment could then learn about the next episodes or sign involved in the concept.” up to audition to play Alex in future installments. Members of the audience could also comment on the plot or “talk” directly to Alex on the campaign’s Facebook wall. 12 | Going native
  • 14. The Advantage of Alignment Because a viewing experience organically Most valuable attributes of online video and unobtrusively intertwined with a site’s Delivery among brand-safe content content is the hallmark of content marketing 65% Alignment with premium site content in general and native video in particular, it’s 60% understandable that marketing executives Delivery as choice-based want their brands “intertwined” with content 57% Custom integration within site look and feel they want the brand to be associated with. 51% Thus, alignment with premium site content Ability to drive sharing 46% is seen by marketing executives as among the most valuable attributes of online video, at 60%. Likewise, marketing executives also point to video delivery among brand-safe content as adding significant value to their brand, at 65%. Copyright © 2012 Forbes Insights | 13
  • 15. Matching the Right Content to the Brand: JetBlue Five years ago, JetBlue developed a campaign tied to the opening of The Simpsons movie, portraying itself as the official airline of Springfield, the fictional hometown of the cartoon family. But JetBlue’s Marty St. George perfect to highlight their brand. The lesson we took from that says the initiative didn’t gener- was: if we’re going to do tie-ins like this, they’ve got to really “Content has to get at ate as much buzz as the com- fit into what we do.” what the brand is about. If pany had hoped; the content didn’t tie closely enough to In June 2012, JetBlue created “Get Away With It,” a game we’re going to do tie-ins, JetBlue’s business. St. George, show-themed campaign highlighting the company’s Getaways they’ve got to really fit who held a less senior market- vacation packages. The show ran in roughly 15-minute install- into what we do.” ing position at the company ments live-streamed over five days. Contestants answered then, saw the more successful travel-related questions via Skype, while viewers could learn —MARTY ST. GEORGE approach in another movie- how to become a contestant on the JetBlue website, which SVP, Marketing and related campaign by 7Eleven, also linked directly to the shows. “If you made it through 12 Commercial Strategy, which remade several stores minutes of that video, you learned an awful lot about JetBlue JetBlue into the Kwik-E-Mart conve- Getaways and about JetBlue,” says St. George. “The good nience store featured in the thing is that the shows are actually hilarious. So you not only cartoon series. “We had a nice learned those things, but you actually had a good time, too.” one-day story, but the cam- paign didn’t really get at what we do the way the 7Eleven Most recently, the company has been running an Election Pro- campaign did,” St. George says. “Content has to get at what tection campaign in which it promises to give free internation- the brand is about.” al, round-trip tickets to about 1,000 customers who voted for the losing presidential candidate. The initiative connects airline JetBlue learned from the experience and continued to look for travel with the fall’s most significant current event, and calls at- inventive ways to market itself. Since its launch in 2001, the tention to JetBlue’s international business, an area it’s focusing company’s unique style and identity have enabled it to stand on and looking to grow. JetBlue’s agency, Boston-based Mul- out in a crowded marketplace—and to compensate for market- len, found an obvious link between the two: the mock threat ing budgets that St. George estimates to be as much as six to to leave the country if a candidate loses. 10 times smaller than those of competitors. “They came back with one of those core insights of how air The airline was an early proponent of digital advertising and travel and presidential elections tie to each other,” St. George now focuses more than half its marketing budget in this area. says. “That was perfect for us. Historically, we didn’t fly any Some of its more successful, recent campaigns have linked pro- international services as a company; we’re now flying to 21 motions and deals to current events in clever, unexpected ways. different international destinations from New York. It’s one of the things that we could get across. The second thing is [that] “When I saw 7Eleven do that I said, ‘You know what? These it shows that brand personality that we’re always trying to get guys did it right. We did it wrong,’” St. George says. “Official across to our customers. This fit it perfectly because it was one airline of Springfield is cool, but it doesn’t really get at the of those things where the minute you hear it, you’re like, ‘Oh core of what we do. It’s not like the Simpsons are flying around my God, that’s so brilliant!’” all the time. What 7Eleven did, highlighting Kwik-E-Mart, was 14 | Going native
  • 16. Conclusion: The Future of the Market As marketers’ understanding of what engages consumers online—and what leaves them cold—evolves, some marketers are opting for online video approaches that are less a ret- rofitting of television ads and more story-based, relevant and easily accessible content that is a destination, not interruptive. Indeed, advertisers are clearly thinking about online video distribution very differently from television. More than half (57%) found that delivering their videos as choice-based, rather than interruptive, was one of the most valuable attributes of online video. Advertisers already appear to recognize the power and Half of survey respondents who don’t yet use native potential reach of this type of approach to digital video; video said that they didn’t know if they would consider 23% of executives said that native video has become a top native advertising in the future. As awareness of its ben- media distribution tactic. As well, more than half of adver- efits increases and more brands find success with native ad tisers (61%) validated the importance of a native look and options, the uncertainty will diminish. feel for their ads rather than a standard ad placement. This The disconnect between those currently using native suggests that demand for native advertising in the near ads and those who value its very advantages suggests that, future will rise significantly. There’s clearly ample room once awareness of native advertising increases, so too will for such growth. the number of brands that deploy it. Copyright © 2012 Forbes Insights | 15
  • 17. Methodology The Forbes Insights/Sharethrough survey tapped 136 marketing executives. Forty-six respon- dents came from companies with revenues between $500 million and $1 billion, and the rest from companies with revenues of $1 billion-plus. Fifty-nine survey respondents had titles of director and up. Roughly half described their business outlook in positive terms, and about two in three said that their media budgets were at least $1 million. The vast majority (99%) are located in the United States. Acknowledgments Forbes Insights would like to thank the following individuals for contributing their thoughts to this report: Marty St. George, SVP, Marketing and Commercial Strategy, JetBlue; Ron Amram, Senior Media Director, Heineken USA; John Watts, Senior Manager of Digital Marketing, Honda USA; Brett Bender, Senior Vice President and Group Account Director, RPA; Billie Goldman, Co-Marketing Manager, Intel; Matt Jarvis, Partner and Chief Strategy Officer, 72andSunny. 16 | Going native
  • 18. About Forbes Insights Forbes Insights is the strategic research practice of Forbes Media, publisher of Forbes magazine and Forbes.com. Taking advantage of a proprietary database of senior-level executives in the Forbes community, Forbes Insights’ research covers a wide range of vital business issues, including: talent management; marketing; financial benchmarking; risk and regulation; small/midsize business; and more. Bruce Rogers Chief Insights Officer Brenna Sniderman Senior Director Christiaan Rizy Director Kasia Moreno Editorial Director James Peter Rubin Report Author Harold Velarde designer 60 Fifth Avenue, New York, NY 10011 | 212.366.8890 | www.forbes.com/forbesinsights