Online video is valuable, and anything with value in a consumer-driven capitalist state can be sold for a profit. According to BI Intelligence, digital video ad revenue reached almost $5 billion in 2016, up from $2.8 billion in 2013. It probably makes sense to monetize your video content as another source of revenue to literally make your videos work for you. But how? There are a number of good options, but the best option for you is dependent on a number of factors, like the nature of the content you produce and the size of the audience it generates. Making the most informed decision often involves dissecting each option and can be time-consuming, so we went ahead and did it for you below.
What was your favorite ad as a child? I know my least favorite: the annoying, ever-present Zoobooks commercial. Regardless, video advertising has been around since the dawn of time. And by this, I mean the dawn of when executives realized they could capitalize on television programming with the first ever TV ad, which promoted a local baseball game. The airtime was purchased for just $4 in 1941. Since then, it has remained one of the most popular ways that brands and services advertise and that visual programming earns revenue—which is definitely worth more than $4 in 2017.
With video advertising, your video content is free and available to a virtually unlimited number of users. If the content is good, free, and accessible, it is likely that you will attract a larger audience—and the more you exhibit an ability to attract an audience, the more businesses will be willing to pay to access this audience. Revenue is generated by selling pre, mid, or post-roll ads, using one of many ad-choice models (such as the VAST and VPAID models offered by Primcast). Ads can be tailored to target audiences by location, interests, etc., which consequently converts more viewers into valuable customers and boosts your advertising value.
Of course, this means that you must demonstrate that you have a large enough audience to target as well as the means to produce video content at a rate that retains viewership, so this option is best left to bigger broadcasters. If you cannot attract a sufficient number of people, it does little in the way of seeing a return on production spending (and just means that you just haven’t met the right one yet). But if you meet the criteria, video advertisements before, during, or after your video content are a very sustainable source of revenue that can work long-term.
Ah yes, pay-per-view. If you’re a sad millennial like me (or older), you may remember the days before Netflix when there was no option but to add $10 to your cable bill if you wanted to see a premium movie on demand. You may even remember Blockbuster. Got chills down your spine yet? This is still a model that works and works well—online, that is. It is used by many platforms, big and small, from those motivational business webinars to Google Play. With pay-per-view, your video content is a standalone product that viewers pay a one-time fee to access. This is done with tools such as a paywall. In general, aim to broadcast your content on a platform that has a monetization option like a paywall built in.
The good? Success in your capitalistic ventures—even if your audience is modest in size, you can still generate a large amount of revenue because pay-per-view content generally brings more income with a smaller audience than other options, making it perfect for small to medium sized broadcasters. This is especially true if your video content fits a particular niche and has a target audience that is willing to pay a premium price on premium content. There are also fewer limits on maximum revenue, so all in all: more money.
The bad? Because this is a one-and-done situation, viewers are only engaged short-term and there isn’t much incentive to commit to your brand (like so many guys I know). You may also have to spend time, money, and effort on attracting viewers since your content isn’t accessible to everyone, so not everyone may know its value. And because viewers are paying valuable dollars for your content, they also need to have access to 24/7 support in case of any issues with playback—but not to worry, as Primcast offers some of the best around-the-clock customer service there is.
The next step up from a pay-per-view is creating a subscription-based service for your video content. The concept is providing valuable content long-term in exchange for a long(ish)-term return on investment. There are many different ways to go about this. You can charge for content as a bundle, as bigger streaming companies like Fox Soccer do, or as a membership where you charge monthly or annually for as low or as much as you like. It is recommended to start low as you build a viewer base. If you charge as little as $1 per month and get, say, 60 new subscribers a month on average, in your first 6 months you are up to $360 in subscription revenue per month.
Unlike with pay-per-view, however, monetization with a subscription service creates brand loyalty because it creates repeat customers. In fact, many people already subscribe to visual content in one way or the other. Think cable and Netflix. It’s convenient for your audience because they know what they want and what they’re getting and they can pay for it all at once. This also generates greater overall revenue for content creators and is a steady form of income. But in order for a subscription service to be a viable option, you must put out video content consistently that people actually want to watch.