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Developing Web Video for Profit

Written by Michael Phillips | Feb 24, 2011 6:00:00 AM

In a recent online study*, Elastic Path found that people are watching large amounts of video online and on an increasing variety of devices - no surprise there. But the study also finds that viewers are also starting to warm up to the idea of paying for online video. That's very good news. Creating and marketing online video can be a costly and time-consuming endeavor. It's time to make those videos earn.

YouTube is, as expected, far and away the leader in the online video space with 81 percent of respondents claiming to have used YouTube in the last 12 months. However, 34 percent used Netflix and 19 percent used iTunes/Apple TV - both paid services. Even more encouraging, 43 percent of total viewers in the survey actually paid to watch online video (excluding adult content).

The reasons given for paying for online video content include:

  • To gain access to videos that I want to watch when I want to watch them (56%)
  • It was cheaper than alternatives (cable/satellite TV, DVD, etc.) (32%)
  • I wanted to avoid watching advertisements (31%)
  • To gain access to exclusive content that is not available on other media like TV or DVD (23%)
  • The content/service was recommended by a friend, colleague, etc. (16%)


While the first two reasons likely apply to categories such as TV shows or movies, the last few reasons are particularly intriguing. Essentially, it shows that paid online video content is not the exclusive domain of the Hollywood producer community.

Also encouraging is that 35 percent of respondents have already paid or would consider paying for an online short film, while 34 percent said the same about instructional or how-to videos. The clear leader for paid content is, of course, full-length movies (75%) followed by TV show/show segments (39%). But if you consider the broad scope of short films and instructional videos, plenty of opportunity exists for Web professionals to actually charge for some online video content. Think of the example of Kindle Singles; Amazon's latest paid content offering featuring 5,000-30,000 word e-books priced anywhere from $0.99 to $3.99. Surely, many of those are of the instructional and short story variety. Might the same model work with video?

Leading the way in online video that respondents claim they will never pay for include non-professional or user-generated videos (84%) - a healthy reminder that every video a business produces should be of the absolute highest quality possible. Faring no better, 84 percent said they would never pay for online video of news or current events.

For those who have the resources, audience and creativity to create paid video content, things are looking good. Of course, this does not apply to most Web business owners. But consider this: 71 percent of the survey respondents say they would be willing to watch embedded advertisements if it meant they could watch premium content for free. The key phrase of course is "premium content." There is no reason a business cannot package video as premium content then freely embed advertising (at a premium, of course) in the video. On the other end, 56 percent of those surveyed said they would likely pay extra to watch video without ads - so, if your content is popular, your "premium content" channel is the one without advertising.

Below are a few more ways to use video to generate revenue:

Create landing pages for your videos
. You don't need to sell anything directly in the video, but create specific landing pages relevant to the videos' content. This way, you keep the viewer in the same frame of mind from the video to the website, and closer to the goal set forth - whether that's a sale, a sign-up or a download.

Consider a paid advertisement linked to your video. Sure, this will cost money in the short term. But if you have some really compelling content (perhaps an exclusive how-to) or just need to make a splash announcing your company and services, this is a good option. The market is crowded - getting your video widely seen is imperative to the end goal for which the video was produced.

Include a coupon or special promotion code in the video. Coupons and daily deals are all the rage right now. Take advantage of this. Have you made a video explaining your product's new features? Get a coupon code in the video so the viewer can act on his impulse. Also, this gives viewers a good reason to subscribe to your video feed.


*The study polled 1,005 U.S. adults over the age of 18 who had downloaded or watched online video at least once in the previous 12 months. More than half (53%) had watched or downloaded online video at least once per week. The most active online video viewers are 18 to 34 year olds, with 63 percent saying they watch weekly or more.