YuMe: Brands Missing the Boat on Web Video Users

Brands are missing out on reaching a significant segment of the population—one that increasingly prefers to watch video on the Web rather than on TV. But they could easily reach this audience by shifting a small portion of their TV budget to online video—and actually spend more efficiently in the process.

At least those are two of the key takeaways from a pair of research reports commissioned by the online video ad network YuMe. The first, conducted by Frank N. Magid Associates, found that 49 percent of respondents now claim that Web video is part of their daily routine.

Perhaps more pertinent for marketers, YuMe argues, is the finding that 70 percent of the heaviest online video viewers say they have increased their consumption over the past year, and more than a third of those folks (35 percent) claim that Web video has cut into their TV viewing.

“TV is still a great medium, but there is this segment that is watching less and less,” said Molly Gallatin, YuMe’s vp of marketing.

Naturally, YuMe, which manages a network of 600 partners—including sites like MSNBC.com—believes it can help brands reach these elusive viewers. According to the second report, which uses Nielsen TV/Internet Data Fusion, YuMe examined what would happen if an unnamed packaged-goods brand, which spent $4.5 million on TV in January 2011, shifted 5, 10 and 15 percent of its budget to YuMe’s network.

In each scenario, YuMe found that the brand’s reach expanded while its overall CPM declined. For example, under the 10 percent budget shift scenario, the CPG brand could have picked up 1.7 million more women 18–54, via YuMe’s network, at no additional cost.

Of course, the obvious question is, isn’t this research a bit self-serving? Not so, according to Gallatin. “We are hopeful that we can help everyone in the video space,” she said. “It’s a scary thing for marketers to shift away from what they’ve been doing for 25 years [by buying TV]. But we want to shine a spotlight on this. Brands need to start doing some reallocation, or they are going to miss out on this segment.”