A few years ago, newspaper publishers were struggling with their video strategies. I witnessed firsthand the amount of effort that went into creating videos and training staff to shoot videos, but perhaps the most challenging thing was selling videos. It wasn’t that the video wasn’t great or the staff didn’t know how to sell media. The biggest issue was the inventory wasn’t meaningful; there just wasn’t enough audience to sell at local newspaper websites.
Fast forward to 2023, video viewing has exploded during the COVID lockdown due to streaming on connected TV or CTV. But how does that help newspaper publishers, and how is it different than the old video strategy?
CTV represents an enormous opportunity for newspaper publishers struggling with declining print revenue and stagnant digital revenue. As audiences shift to streaming television viewing, ad budgets are following. According to Comscore’s 2023 State of Streaming report, 238 million CTV viewers were in the U.S. in May 2023. Time spent streaming CTV has skyrocketed, with consumers streaming 11 billion hours in May 2023, up two billion from May 2022.
This seismic shift in viewing habits has advertisers rapidly allocating more budgets to CTV. Statista predicts CTV U.S. ad spending will hit $25 billion in 2023, up 22% from 2022 levels, and is expected to reach $40 billion by 2027. The challenge for local papers is producing compelling enough video content and ads to grab a piece of the growing CTV advertising pie. Fortunately, new technologies are emerging to make this achievable for even the smallest publisher.
For local newspaper publishers, CTV represents a significant opportunity if they can clear some key hurdles. As CTV becomes mainstream, local ad buyers will want to reach these audiences. Currently, broadcasters and MVPDs control the most premium ad inventory and first-party data. That landscape is starting to shift with the rise of free ad-supported streaming television (FAST).
FAST channels provide a cable-like viewing experience through free, linear streaming networks. For example, Pluto TV, Tubi, Amazon's Freevee and the Roku Channel are among the top FAST platforms. FAST offers publishers a way to get their advertisers’ video ads in front of CTV audiences and share in ad revenue. As consumers gravitate to free options, local papers have an opportunity to earn a piece of CTV ad spending.
Just as national advertisers pay a premium for high-quality print ads, local advertisers will pay more for professionally produced video spots optimized for the living room viewing experience. Publishers can even package digital display ads from their website with CTV spots for integrated campaigns.
But herein lies the problem. High-end TV spots are expensive and time-consuming to produce at scale, especially for local newspapers with limited resources. That’s where exciting new technologies like AI video creation come into play.
Companies like Waymark, inVideo and Pictory.ai offer solutions that automatically generate 15- to 30-second video ads from simple text, logos, images, stock and original advertiser footage. This allows publishers to cost-effectively create high-quality CTV spot ads tailored to each local advertiser. And with dynamic ad insertion (DAI), these personalized ads can be stitched into live streams on the fly.
These AI-generated video ads will continue to improve rapidly.
Local newspapers and, to a lesser extent, local broadcasters have struggled with generating meaningful video revenue as they had been limited by the amount of owned and operated inventory, i.e., audience and ad impressions they could generate. Today, publishers can take their advertisers into the world of FAST ad placement. They can use media buying platforms optimized for local buyers, like newcomer Ribeye Media or Vibe, which provide simplified buying on Pluto.TV, Tubi, Samsung TV Plus and other FAST inventory. Geographic targeting allows placing ads on CTV and OTT inventory at the DMA, city and ZIP code level on specific programming genres.
The CTV advertising boom offers a lifeline to local newspapers adapting to print declines. New streaming distribution channels, AI-powered video creation tools and simplified media buying solutions allow publishers to sell CTV ad inventory using advanced targeting techniques. As consumer attention shifts to streaming, savvy publishers are shifting strategies to embrace CTV advertising.
CTV advertising represents the future, but publishers still face some challenges in execution. Here are some best practices local papers should keep in mind:
Use CTV revenue to fund your journalism. CTV ad rates are the highest in the media industry, with premium content selling for $60 CPMs or higher. Don’t get caught up in selling a $500 print ad at 100% margin vs. a $20,000 CTV campaign at 50% margin.
No O&O limitations
In the old business model, a publisher’s constraints were their circulation or digital audience. In the new economy, a publisher is limited by the number of advertisers they work with and the amount of their omnichannel ad spend they can manage. The majority may not want your print or website traffic; take their money and sell them what will move their business forward. Make sure your sales compensation structure reinforces this.
Don’t be limited by your geography.
Selling CTV advertising is not limited to just selling your geography. If you have a local advertiser who wants to extend their geographic reach, let them target the state or the country. Manage that spend.
Understand and own the process.
In the early days, many publishers threw CTV requests to third-party service providers to manage the account and ad placements. CTV is now too big financially and strategically. Bring those processes in-house and dedicate resources. It’s too vital to your long-term success. You are also giving up a significant margin doing this.
Build an internal workflow
Create a streamlined process for identifying advertiser needs, utilizing AI creation tools and trafficking ads to streaming channels.
Start small, test and optimize
You don’t need millions of impressions out of the gate. Pilot CTV campaigns with a few advertisers, measure results and improve.
Many local ad buyers may be unfamiliar with streaming and CTV. Provide thought leadership on the benefits and guide them through the process.
Monitor industry trends
CTV ad tech is evolving rapidly. Stay current on new targeting techniques, measurement models, video formats, etc.
The time is now for local newspaper publishers to wade into connected TV advertising. Consider starting simply by producing a few high-impact spots for key advertisers. As you build expertise, layer in more advanced tactics. With the right strategy, CTV can provide a bridge to the future for legacy media brands adapting to the digital world. If done correctly, CTV is way more important and less disappointing than digital display ever was.
Guy Tasaka is a seasoned media professional with a 35-year track record of leading change in the industry. He has collaborated with renowned organizations such as Macworld Magazine, Ziff-Davis and The New York Times, where he honed his expertise in research, strategy, marketing and product management. As the former chief digital officer at Calkins Media, Guy was acknowledged as the Local Media Association's Innovator of the Year for his work in advancing OTT and digital video platforms for local news organizations. He is also the founder and managing partner of Tasaka Digital, specializing in helping media and technology companies navigate business transformations using his extensive experience and forward-thinking approach. Guy can be reached at email@example.com.
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