How to Make Money on the Web

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Slides from workshop at the Italian Doc Screenings. PDF format. Video have been replaced by You Tube links

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How to Make Money on the Web

  1. 1. How to make money on the webItalian Doc Screenings, November 2012
  2. 2. How to make money on the web Maybe....If I knew for sure, would I still be here?....
  3. 3. Who I amportante@rai.it
  4. 4. ObjectiveProvide 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
  5. 5. If you want to leave now:Great potential but not a sure thingNot just a producer but a marketer Inspiration but also perspiration
  6. 6. Two  main  effects  of  new  technologies:•Lowering of production and distribution costs•“Dis-intermediation” 6
  7. 7. More capacity...less cost Capacity Cost CPUHard Disk Kb/$ (Log) 7
  8. 8. ...beyond  imagina9on  IBM 360 - 1964 IPhone 4 - 2010RAM: 64-512 K RAM: 16-32 G $5,000,000 530 Euro 8
  9. 9. This  trend  is  par9cularly  visible  in   the  audiovisual  industry 9
  10. 10. and  in  music 10
  11. 11. Example:  Bloody  Omahahttp://www.youtube.com/watch?v=WRS9cpOMYv0 11
  12. 12. Besides  lower  costs,  dis-­‐intermedia9on  is  the   other  key  effect  of  new  digital  tecnologiesViewer Broadcaster Producer AuthorReader Distributor Publisher Author MusicListener Distributor Author Label 12
  13. 13. Given your background, we focustherefore on filmed entertainment 13
  14. 14. One  Reason to  be  on  the  web To make money 14
  15. 15. Two  Reasons to  be  on  the  web 1) To make money 2) Promote your work 15
  16. 16. Promote yourself andthen make moneythrough “traditionalmedia” 16
  17. 17. Three Reasons  to  be  on  the  web 1) to make money 2) to promote yourself 3) to familiarize with the tools and understand the dynamics 17
  18. 18. Who  am  I  quo9ng? 18
  19. 19. http://www.youtube.com/watch?v=7WJXHY2OXGE&list=LPruYjC5ZD-Do&index=5&feature=plcp 19
  20. 20. 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
  21. 21. ...but  viewers  are  merciless:“If  you  want  uncondi9onal   praise...ask  your  mother” 21
  22. 22. Online audience can be as bad as that of live entertainmenthttp://www.youtube.com/watch?v=RdR6MN2jKYs 22
  23. 23. To make Money Now Possibly in the futurePay per view TV sales The User PaysDownload (for your film) CrowdsourcingAdvertising Investor Pays (for your viewers) SponsorAffiliatePrograms Co-Proe-Commerce(es. Licensing) 23
  24. 24. Pay Model: Several Platforms available...but not so much in Europe/Italy 24
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  27. 27. For video, most platforms use “Aggregators”Producer Aggregator Platform 27
  28. 28. What does an “Aggregator” doEncode for different platformsChapter breakingTagging (can be long andQuality Control processing painful e.g. with IMarketing (?) Tunes)Contract ManagementReporting They act as “filter” for the main platforms (editorial quality, technical process) 28
  29. 29. The middle man! ...is back? 29
  30. 30. How the money goes - “traditional” Example $500-2500 Encoding/Processing/Marketing $4,9 $2,1 $2,99 30% 70% $7.0 30% $9,99 70%Producer Aggregator Platform 30
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  33. 33. Indieflix is both an aggregator and a plarform 33
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  37. 37. How the money goes - “New” $1,295 One time fee $2,99 $7,0 100% $7.0 30% $9,99 70%Producer Aggregator Platform 37
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  40. 40. Free Donations are another option 40
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  43. 43. The Yes Men who fix the world 2009 documentary film about the culture jamming exploits of The Yes Men. The movie has been sued by United States Chamber of Commerce It 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 43
  44. 44. Others are following the “donation” model 44
  45. 45. It is possible to get awy from platforms and “do it your way” 45
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  58. 58. 1. Make it easy and obvious. People come to your site because they want to watchyour film, so help them do that2. Include a Preview. Dynamo lets you add a preview video to the player, soviewers can watch your trailer before paying.3. Sell it! In order to take advantage of online distribution, you need to take it just asseriously 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 allof your followers and fans,6. Publish Everywhere. Dynamo Player is great for selling your film on your ownsite, but it’s also great for selling your film elsewhere.7. Relationships Beat Affiliates. Reaching out to your fans directly and askingthem 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 bumpthat continues until Monday morning.9. Bonus Material. Dynamo lets you include all of the video extras you wouldnormally 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. Meanwhileanything over $4.99 has a hard time competing with the sea of Hollywoodblockbusters available for rent at much lower prices. 58
  59. 59. To be considered (seriously)70% of something... or 100% of nothing? 59
  60. 60. Live Performances at set times...??? 60
  61. 61. Good Representation for documentaries 61
  62. 62. Typical Revenue Share split from platforms♣ iTunes 70/30 with 70% going to the filmmakerand 30% going to iTunes.♣ Hulu 50% of the advertising revenue goes to thefilmmaker.♣ Amazon VOD pays the filmmaker 50% of whatthey collect.♣ Netflix purchases a licence for your film for 1 or2 years and they can play your film as many timesas they like during that period of time. Licensingfees vary on a film by film basis.♣ VODO 75% of sponsorships raised (donations)go to the film maker and 50% of profits frommerchandisingt 62
  63. 63. There are several Advertising funded platforms 63
  64. 64. A new Job for the Producer Designing Writing Formatting Producing Promoting Selling...for online and “mobile” audiences 64
  65. 65. Producing for the web1.    Thirty seconds on TV translates to eight seconds ofWeb video. That means you have to be succinct—shortbeyond short. Make every second count.2.    Producers often don’t understand the impact of filesize and compression algorithms. Shooting busybackgrounds, pans and zooms increase your file size. Bythe time your video is shared, reposted and bouncedaround a few times, you’re footage will lose resolution.3.    Web videos play on the tiny screen. What is fine on atelevision is too busy for Web video. Use simple shots.Zooming around and special effects will make your viewerqueasy and confused.Source: Merriam Associates 65
  66. 66. Producing for the web 4.   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 66
  67. 67. 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 67
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  70. 70. The project is told on a variety of platformsincluding a TV documentary, a web documentary, abook, an iPhone app, and an exhibition in Paris.Viewers of the web documentary are asked to signin through Twitter, Facebook, or asked to make anaccount on the film’s site in order experience thestory.The storyline mimics a road trip, as you areencouraged to take detours and learn more aboutthe background, news, and other additionalinformation about prisons in America. 70
  71. 71. Online Marketing and Promotion It’s keyNo need to say more! 71
  72. 72. Web Site vs 3rd Party Platform (Es. You Tube) Why not both? 72
  73. 73. As in retail the secret is:Location Location Location 73
  74. 74. Location Location Location 74
  75. 75. There are several possibleplatforms, but You Tube is dominant 75
  76. 76. To become Partner Own Rights Willingness to monetize Steady flow of videos Grow subscriber base Comply with the rules Increasing views04/26/11 8
  77. 77. ADV Formats are not invasive Text/ Overlay + Spondored Image Overlay Banner InStream Video Video Image Video
  78. 78. In-stream (Pre-roll) (short-form) Format (YouTube) Metrics • 15 sec video pre-roll • Impressions, clicks • No skipping • Mid-points, completes • User sees max 1 pre-roll every 7 minutes • 300x60 companion*Not available to advertisers who buy through the AdWords auction
  79. 79. InVideo Overlay Format Metrics • 480x70 overlay + 300x250 companion • Impressions, clicks • When overlay is clicked it can: • Spawn a video within player Pricing • Click off-site • 5 - 10 depending on segmentation • On YouTube, video will run as post-roll, if ad not clicked*
  80. 80. 300x250 Format Metrics • 300x250 • Impressions, clicks • Rich media*
  81. 81. Other advertising you may see on the watch pagePromoted videos • Interleaved with text adsCall To Action • Advertisers can run a Call To Action on their own Promoted Video Only appear if no ads are soldClick To Buy directly • Buy the original music and video at the click of your mouseText ads • AdWords text ads contextually targeted
  82. 82. 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 Enthusiasts TV Fans
  83. 83. Revenue Equation Revenue = CPM X Video Views •Higher prices on “much higher” on You Tube own portal (?) •No Rev. Sharing • from 5x to 20x...no cannibalization so each Euro/$ is incremental
  84. 84. Video usage concentrates on first 10 days but the “tail” is very long
  85. 85. How do you get paid? YouTube AdSense Monthly Sales Sales Payment
  86. 86. Sponsoring Opportunities
  87. 87. A success: Simon’s Cat
  88. 88. You Tube as “launch pad” 88
  89. 89. An Integrated System 89
  90. 90. You Tube links back to the web site, website embeds videos streamed on YouTube 90
  91. 91. Simon also published books... 91
  92. 92. ...and licensed products 92
  93. 93. Facebook is a key tool for promotion 93
  94. 94. ...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 94
  95. 95. Economics Fan Base Facebook 160.000  140.000  1 update/day 120.000 Revenues Euro 100.000 , Cumulative 80.000  60.000  40.000  1 update/week 20.000  0  1  2  3  4  5  6  7  8  9  10  11  12  13  Months 1 update/week 1 update/day 95
  96. 96. Thumbnail!!!(if you go and check it...it’s not what it seems) 96
  97. 97. Google’s AdSense Referral Partner ProgramGoogle can help you enhance yourvalue proposition to your bloggersthrough 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 WorkGoogle Confidential 97
  98. 98. Adsense Reaches millions of users as they read content online Google scans a page, interprets its content and serves relevant ads Relevant ads Targeted in real-time Recipe for Roasted Garlic Pasta Sauce 98
  99. 99. Google Content Network Google Content Network Google Advertising 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 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
  100. 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 $20For more information • 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 Jessie.g@google.com Google Confidential 100
  101. 101. Pay Per ActionSet cost-per-action (CPA) Publisher chooses Ad shows on publisher’svalue for a specific action your PPA ad and site on your site places it on his site User clicks on User completes Pay for completed ad action action(s)
  102. 102. A preliminary “back of the envelope” calculation Ricavo Medio Netto da 3 a 15 per Pagina Vista (Euro/1000 pagine) Pagine Ricavi 1,000 5 Euro 10,000 50 Euro 100,000 500 Euro1,000,000 5,000 Euro 102
  103. 103. So who is your market? Then NowA few buyers in Cannes 103
  104. 104. Today IPAD, IPhone are a channel of increasing importance 104
  105. 105. Huge installed base and sales growth 760 MillionDevices in 2012 760 MillionDevices in 2016 105
  106. 106. The two platforms have different approaches 106
  107. 107. The “Business Model” is pretty standard 107
  108. 108. • 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 Apples rules. Apples 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 Apples platform. 108
  109. 109. Example of interactive e book https://www.youtube.com/watch?v=LV-RvzXGH2Y 109
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  112. 112. But huge number of apps in the stores 112
  113. 113. Difficult to stand out in the crowd 113
  114. 114. Users are again the key to success 114
  115. 115. Affiliate Programs 6% del ricavo Ricavi fino al 15% dipendono dal valore della 6-8% vendita o ARPU del cliente 5 Euro/Abbonato procurato 115
  116. 116. Earn through affiliate programs 116
  117. 117. Licensing&Merchandising 117
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  119. 119. Also other services : es. Zazzle 119
  120. 120. You decide how much to charge for your work (royalty) 120
  121. 121. ...but the user always has the final word: to buy or not to buy 121
  122. 122. Basically we sell “traffic” 122
  123. 123. “Eyeballs” 123
  124. 124. In entertainment success is highly unpredictable and not easily reproducible 124
  125. 125. Now it’s your turn! Good Luck! 125
  126. 126. Thanks! 126

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