how to make money on the web
TRANSCRIPT
How to make money on the web
Italian Doc Screenings, November 2012
How to make money on the web
Maybe....
If I knew for sure, would I still be here?....
Objective
Provide tools or at least a framework of reference to use the web to our
advantage
Plant some seeds for a more general discussion
...while avoiding being boring
If you want to leave now:
Great potential but not a sure thing
Not just a producer but a marketer
Inspiration but also perspiration
Two main effects of new technologies:
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•Lowering of production and distribution costs
•“Dis-intermediation”
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Capacity Cost
CP
UH
ard
Dis
k
Kb/$ (Log)
More capacity...less cost
...beyond imagina9on
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IBM 360 - 1964
RAM: 64-512 K
IPhone 4 - 2010RAM: 16-32 G
$5,000,000 530 Euro
This trend is par9cularly visible in the audiovisual industry
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and in music
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Example: Bloody Omaha
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http://www.youtube.com/watch?v=WRS9cpOMYv0
Besides lower costs, dis-‐intermedia9on is the other key effect of new digital tecnologies
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Reader Distributor Publisher Author
Listener MusicLabelDistributor Author
Viewer Broadcaster Producer Author
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Given your background, we focus therefore on filmed entertainment
One Reason
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To make moneyto be on the web
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2) Promote your work
to be on the webTwo Reasons
1) To make money
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Promote yourself and then make money through “traditional media”
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Three Reasons to be on the web
2) to promote yourself1) to make money
3) to familiarize with the tools and understand the dynamics
Who am I quo9ng?18
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http://www.youtube.com/watch?v=7WJXHY2OXGE&list=LPruYjC5ZD-Do&index=5&feature=plcp
Once upon a 9me...you had to convince channel commissioners and buyers to choose your 9tle. Now you can go directly to the
viewers...20
...but viewers are merciless:
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“If you want uncondi9onal praise...ask your mother”
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Online audience can be as bad as that of live entertainment
http://www.youtube.com/watch?v=RdR6MN2jKYs
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To make Money
Pay per viewDownload
Advertising
Affiliate Programs
e-Commerce (es. Licensing)
TV sales
Crowdsourcing
Sponsor
Co-Pro
The User Pays (for your film)Investor Pays(for your viewers)
Now Possibly in the future
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Pay Model: Several Platforms available
...but not so much in Europe/Italy
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For video, most platforms use “Aggregators”
PlatformAggregatorProducer
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What does an “Aggregator” do
Encode for different platforms
Chapter breaking
Tagging
Quality Control processing
Marketing (?)
Contract Management
Reporting
(can be long and painful e.g. with I
Tunes)
They act as “filter” for the main platforms (editorial quality, technical process)
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The middle man!
...is back?
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How the money goes - “traditional”
PlatformAggregatorProducer
$9,9930%
70%
70%30%
$2,99
$7.0
$2,1$4,9$500-2500
Encoding/Processing/Marketing
Example
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Indieflix is both an aggregator and a plarform
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How the money goes - “New”
PlatformAggregatorProducer
$9,9930%
70%
100%
$2,99
$7.0$7,0
$1,295One time fee
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Free Donations are another option
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The Yes Men who fix the world2009 documentary film about the culture jamming exploits of The Yes Men. The movie has been sued by United States Chamber of CommerceIt documents the following projects:■ US Chamber of Commerce and climate change■ Dow Chemical and Bhopal■ ExxonMobil Vivoleum■ Halliburton Survivaball■ HUD and post-Katrina public housing■ New York Times hopeful future edition
$26,000 collected through VODO. 700,000 views. $5000 od DVD sales in two months
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Others are following the “donation” model
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It is possible to get awy from platforms and “do it your way”
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1. Make it easy and obvious. People come to your site because they want to watch your film, so help them do that2. Include a Preview. Dynamo lets you add a preview video to the player, so viewers can watch your trailer before paying. 3. Sell it! In order to take advantage of online distribution, you need to take it just as seriously as you do any other distribution.4. Online Sales Require Online Buzz. Find your audience online and engage them! 5. Build a Facebook App! A custom Facebook app lets you promote your film to all of your followers and fans, 6. Publish Everywhere. Dynamo Player is great for selling your film on your own site, but it’s also great for selling your film elsewhere. 7. Relationships Beat Affiliates. Reaching out to your fans directly and asking them to spread the word is far more likely to engage dedicated evangelists. 8. Sales happen on weekends. Every Friday night our sales numbers get a bump that continues until Monday morning. 9. Bonus Material. Dynamo lets you include all of the video extras you would normally put on a DVD. 10. Pricing Is Key. The best sales results for feature films have been $1.99 to $4.99, with a major drop in sales above and below those prices. 99¢ is great for short films, but at 99¢ your masterpiece feature may appear to be nearly worthless. Meanwhile anything over $4.99 has a hard time competing with the sea of Hollywood blockbusters available for rent at much lower prices.
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To be considered (seriously)
70% of something... or 100% of nothing?
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Live Performances at set times...???
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Good Representation for documentaries
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Typical Revenue Share split from platforms
♣ iTunes 70/30 with 70% going to the filmmaker and 30% going to iTunes. ♣ Hulu 50% of the advertising revenue goes to the filmmaker.♣ Amazon VOD pays the filmmaker 50% of what they collect.♣ Netflix purchases a licence for your film for 1 or 2 years and they can play your film as many times as they like during that period of time. Licensing fees vary on a film by film basis.♣ VODO 75% of sponsorships raised (donations) go to the film maker and 50% of profits from merchandisingt
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There are several Advertising funded platforms
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A new Job for the Producer
DesigningWriting
FormattingProducingPromoting
Selling
...for online and “mobile” audiences
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Producing for the web1. Thirty seconds on TV translates to eight seconds of Web video. That means you have to be succinct—short beyond short. Make every second count.
2. Producers often don’t understand the impact of file size and compression algorithms. Shooting busy backgrounds, pans and zooms increase your file size. By the time your video is shared, reposted and bounced around a few times, you’re footage will lose resolution.
3. Web videos play on the tiny screen. What is fine on a television is too busy for Web video. Use simple shots. Zooming around and special effects will make your viewer queasy and confused.
Source: Merriam Associates
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Producing for the web4. The computer mouse is dramatically faster than the TV remote. You have to grab attention fast.5. People are watching your video inches from their faces, not from across the room. Shoot close up and create a close feel.6. Quality content doesn’t mean slick production—it means engaging and rewarding content. Slick production can sometimes come across as inauthentic, especially if you offer more glitz than content. 7. One idea per video. Get to the punch line fast. If you have three ideas, do three videos. Three focused sixty-second videos are better than one three-minute video.
Source: Merriam Associates
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Producing for the web
8. TV is all give and no take. Web video should be part of the conversation. Allow comments. Let people share your content. Web video is social.9. Web video is non-linear—viewers can meander wherever they want, whenever they want. Produce video that doesn’t try to fence people in.10. People accept, even expect low quality video on the Web. They will not tolerate poor audio. With high quality earphones on their heads, people will click away from poor sound.
Source: Merriam Associates
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The project is told on a variety of platforms including a TV documentary, a web documentary, a book, an iPhone app, and an exhibition in Paris.
Viewers of the web documentary are asked to sign in through Twitter, Facebook, or asked to make an account on the film’s site in order experience the story.
The storyline mimics a road trip, as you are encouraged to take detours and learn more about the background, news, and other additional information about prisons in America.
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Online Marketing and Promotion
It’s keyNo need to say more!
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Web Site vs 3rd Party Platform (Es. You Tube)
Why not both?
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As in retail the secret is:Location Location Location
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Location Location Location
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There are several possible platforms, but You Tube is
dominant
To become Partner
04/26/11 8
Own Rights Willingness to monetize
Steady flow of videos
Comply with the rules
Grow subscriber base
Increasing views
ADV Formats are not invasiveText/
Image OverlayOverlay + Banner InStream Video
Spondored Video
Image Video
In-stream (Pre-roll) (short-form)
Format (YouTube)• 15 sec video pre-roll
• No skipping
• User sees max 1 pre-roll every 7 minutes
• 300x60 companion
Metrics• Impressions, clicks
• Mid-points, completes
*Not available to advertisers who buy through the AdWords auction
InVideo Overlay
Format• 480x70 overlay + 300x250 companion
• When overlay is clicked it can:• Spawn a video within player• Click off-site
• On YouTube, video will run as post-roll, if ad not clicked*
Metrics• Impressions, clicks
Pricing• 5 - 10 depending on segmentation
300x250
Format• 300x250
• Rich media*
Metrics• Impressions, clicks
Other advertising you may see on the watch page
Promoted videos• Interleaved with text ads
Click To Buy• Buy the original music and video at the click of your mouse
Call To Action• Advertisers can run a Call To Action on their own Promoted Video
Only appear if no ads are sold
directly
Text ads• AdWords text ads contextually targeted
Interest Based Advertising: Categories Available
Pet Lovers Fitness Buffs Mothers
Auto Buyers Beauty & Personal Care Home Buyers
Auto Enthusiasts Green Consumers Job Seekers
Basketball Fans Food & Drinks Brides-To-Be
Parenting Mobile Users University Students
Sports Fans Financial Information Seekers Outdoor Enthusiasts
Golfers Credit Cards Interest Fishermen & Hunters
Motor Sports Enthusiasts Mortgage interest Shopaholics
Racquet Sports Enthusiasts Insurance interest Luxury Goods Consumers
Football Fans Loan Interest Arts & Culture
Winter Sports Enthusiasts Technology Consumers Celebrity
Cricket DIYers Comedy Fans
Rugby News Readers Photo/Video Buffs
Water Sports Political Interest Video Gamers
Entertainment Buffs Travel Enthusiasts Web Developers
Movie Goers Small Business Owners Household Decision Makers
Music Lovers B2B Business Decision Makers
Classical Music Lover IT Decision Makers Extreme Sports EnthusiastsTV Fans
Revenue Equation
Revenue = CPM X Video Views
•Higher prices on own portal (?)•No Rev. Sharing
“much higher” on You Tube
...no cannibalization so each Euro/$ is incremental
• from 5x to 20x
Video usage concentrates on first 10 days but the “tail” is very long
How do you get paid?
YouTubeSales
AdSenseSales
Monthly Payment
Sponsoring Opportunities
A success: Simon’s Cat
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You Tube as “launch pad”
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An Integrated System
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You Tube links back to the web site, website embeds videos streamed on YouTube
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Simon also published books...
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...and licensed products
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Facebook is a key tool for promotion
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...but fans can also be a source of revenues
“Organic Grow” 2% mese
Click Rate 50%Each view monetized by YT @1,5 Euro/CPM
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1 update/day
1 update/week
Economics Fan Base Facebook
0
20.000
40.000
60.000
80.000
100.000
120.000
140.000
160.000
1 2 3 4 5 6 7 8 9 10 11 12 13
1 update/day
1 update/week
, Cum
ulat
ive
Rev
enue
s E
uro
Months
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Thumbnail!!!(if you go and check it...it’s not what it seems)
Google Confidential 97
Google’s AdSense Referral Partner Program
Google can help you enhance your value proposition to your bloggers through Google AdSense– Google AdSense is a quick and easy way for
website publishers/ bloggers of all sizes to display contextually relevant, unobtrusive ads on their blogs and earn money.
– Every time one of your bloggers qualifies as a completed referral, Google will pay you a bounty.
Google AdSense at Work
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Adsense Reaches millions of users as they read content online
Google scans a page, interprets its content and
serves relevant ads
Recipe for Roasted Garlic Pasta Sauce
Relevant ads Targeted in real-time
Google Content Network
Hundreds of thousands of worldwide content partners*Google Advertising Network = Google properties + syndicated search + Google content network Sources: comScore Media Metrix (August 2007); Google internal analysis
GoogleAdvertising Network*
GoogleContent Network
• Reaches 548 million worldwide Internet users, more than any other property or network
• Tens of thousands of advertising auctions occur every second to select and serve relevant ads
• Hundreds of thousands of worldwide advertisers and publishers
Google Content Network
Google Confidential 100
Become an AdSense Referral Partner in 3 easy steps
• Fill out an online form - it takes just a couple of minutes
– http://services.google.com/inquiry/referral_apply
• Google will provide you with a special AdSense link for your site
• When your bloggers click on the Google AdSense link, sign up for AdSense and qualify as a completed referral, you earn $20
• Visit www.google.com/referral
• Terms and conditions at http://www.google.com/referral/terms.html
• Referral Program FAQs at http://www.google.com/referral/faq.html
• E-mail Jessie Ghai at [email protected]
For more information
Pay for completed action(s)
User clicks on ad
User completes action
Set cost-per-action (CPA) value for a specific action
on your site
Pay Per Action
Publisher chooses your PPA ad and
places it on his siteAd shows on publisher’s
site
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A preliminary “back of the envelope” calculation
Ricavo Medio Nettoper Pagina Vista
da 3 a 15 (Euro/1000 pagine)
1,00010,000
100,0001,000,000
5 Euro50 Euro
500 Euro5,000 Euro
Pagine Ricavi
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Then Now
So who is your market?
A few buyers in Cannes
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Today IPAD, IPhone are a channel of increasing importance
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Huge installed base and sales growth
760 Million Devices in 2016
760 Million Devices in 2012
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The two platforms have different approaches
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The “Business Model” is pretty standard
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• Distribution: Native apps are distributed through app stores and markets controlled by the owners of the platforms. HTML5 is distributed through the rules of the open web: the link economy.
• Monetization: Native apps come with one-click purchase options built into mobile platforms. HTML5 apps will tend to be monetized more through advertising, because payments will be less user-friendly.
• Platform power and network effects: Developers have to conform with Apple's rules. Apple's market share, meanwhile, creates network effects and lock-in. If and when developers can build excellent iPhone and iPad functionality on the web using HTML5, developers can cut Apple out of the loop. This will reduce the network effects of Apple's platform.
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Example of interactive e book
https://www.youtube.com/watch?v=LV-RvzXGH2Y
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But huge number of apps in the stores
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Difficult to stand out in the crowd
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Users are again the key to success
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Affiliate Programs
6% del ricavo
6-8%
5 Euro/Abbonato
fino al 15% Ricavi dipendono dal
valore della vendita o ARPU
del cliente procurato
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Earn through affiliate programs
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Licensing&Merchandising
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Also other services : es. Zazzle
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You decide how much to charge for your work (royalty)
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...but the user always has the final word: to buy or not to buy
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Basically we sell “traffic”
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“Eyeballs”
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In entertainment success is highly unpredictable and not easily
reproducible
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Now it’s your turn!
Good Luck!
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Thanks!