Richard Teideman of London Creative tells us how online video is killing the television star and what brands can do today to be ready for tomorrow…
“Wow! Thank you so much. That was just incredible. My mind is now fried. We’re now going to zoom out, and what I want to do tonight… My name is Richard. I’m CEO of a company called London Creative. We’ve been going for 16 years, and we’ve seen the most incredible convergence of two industries. We started in television, and my background is with ITN. Then in 2001 we started to do digital work, and we’ve seen these two converge.
I have the most incredible job, because on a day-to-day basis I see an emerging industry. What I want to do is really tonight, rather than talk specifically about some technical stuff … we’ve had a lot of that, and I just believe in that. There’s so much there … but I just want to blow your minds a little bit, and I want to tell you that going forwards is going to be the most radical industrial revolution in the industry of television that you’ve ever seen.
Since the 1950’s we are just about – and I’m seeing it on my desk on a day-to-day basis – we’re just about to experience an incredible transformation in the way in which we consume television. We’ve seen some prototypes and some emerging trends of that tonight. But just over about six slides and about ten minutes, I’d just like you to hold my hand, and we’re just going to go together.
Then I’m going to pull it right back down to brass tacks to tell you, as people in business today, what this means to you, and what you can do, practically tomorrow, that would in fact empower you and help you. It’ll also give you something to talk about perhaps if you’re sharing it with your business colleagues.
So effectively, the first thing you need to know is something which I learned off some of the interns which I get into my company. We get lots of letters every single day, and it’s fascinating to talk to the teenagers, because they are really emerging. I’d like you to know that the 16-year- olds and the 17-year-olds that we get in have stopped using Facebook.
Another phrase which I hear an awful lot from 16-year-olds is, “Why would I want to watch cable TV?” Put your hands up here if you have satellite or cable. So that’s roughly about 80 percent of the room. Who has Sky here? So that’s roughly, what, about 70 percent of the room. Who has Virgin Media? So generally we’re looking at those two as being the two main providers.
Let me tell you something. That industry is already dying in the United States of America. We are going to see the decline of the cable and satellite industry, and that’s what I want to talk to you a little bit about. It’s television, but not as we know it. Let me read these to you. In the past month more than 200 billion videos have been viewed online, including full-length television shows. Those TV shows that you are currently watching of an evening, you can stream them online for free. Did you know that? You can get them whenever you want, wherever you want, and you don’t have to pay for it.
Secondly, 83 percent of viewers aged 18 to 29 say they watch some, most, or all of their shows online. As a company, I’m going to tell you this. And the lawyers in the room, you’ve got to close your ears now, because I’m going to tell you something that we used to do illegally. We’ve worked with the film industry since 1998, and what happened was piracy with films was so great that they would not release the preview copies of the films to us.
So we’d get a phone call like this. We’d get Paramount, and they’d ring us and they’d say, “Hello. We’ve got a film coming up. Could you promote it for us?” “Yes, of course we can. When is it coming out?” “Three week’s time.” “Fine. Can we have a copy of it?” “No, you can’t.” “Okay. So how are we going to promote this film if we don’t have a copy of it?” “That’s your problem,” and the phone goes down.
We would have to pirate the movies in order to get the assets to promote the movies in the first place. So we’d been doing this for a long time. Trust me, that model that we were using, and we were using it in … I remember quite clearly we were using it in 2004. We were downloading movies illegally to get the assets off them to make the adverts for the movies. People are doing this right now. Most of the teenagers right now are just not watching this stuff real-time. They’re pirating it. They’re downloading it, they’re using illegal sites to access this stuff.
Sony PlayStation, Microsoft Xbox, Samsung, pull shows directly from the Internet to your television screen. There’s a company called Aereo, A-E-R-E- O, in the United States that does it with no box at all. You can just watch this stuff direct from the Internet. Ninety-four percent of us enrich our experience with emails, text messages, social networks that we watch. In the U.S.A. the percentage of households with cable and satellite subscription is declining for the first time in the history of television. So brace yourself. We’re about to undergo a television revolution.
Now look at this. This is in fact the home page of a part of Google that you probably haven’t heard of, and it’s called Google Fiber. Now what Google are doing in the United States are they’ve developed something called Google Fiber. Now they have about $100 billion on the balance sheet, so they can play a little bit. They are laying down fiber optics in the United States, and they have already completely fibered up Kansas.
Now, if you have Internet into your home, you probably, if you’re paying a little bit, are getting about maybe 30 meg, something like that, 40 meg. Kansas has 1000. So Stuart over there who’s come, he’s very kindly filming it for us tonight for my company, he was in Japan. He was telling me a story where the download speed is so fast in Japan, he uploaded some photos to the Internet, and he pressed the button and he didn’t think it had happened. So he pressed again, and he pressed again, and then it told him it was full. It turned out he’d uploaded them 30 times, because it’s so fast you don’t even notice that it’s uploading.
Now this is what Kansas is already experiencing. Well, let me tell you something. Google are going to create something across the United States, and they’re going to do it over here as well, and they have a connection that is 100 times faster than today’s average broadband speeds. Instant downloads, crystal clear high definition TV, endless possibilities. And do you know what they’re going to do? They’re going to give it away for free, and that’s going to cause a massive problem to some of the infrastructure owners over here, because Google can afford to give it away for free.
Those of you who are in business for a long time will know that if you own the infrastructure, then effectively you own the content. Let me tell you, in this revolution that I’m telling you about it is the content providers who are going to win. So if you’re in the publishing industry, and I saw there is somebody in the publishing industry here tonight on the guest list, you are in a great place. Because effectively every company will become a broadcaster, if you’re not already there. We’re hearing about it tonight, ways in which you can become a broadcaster.
Film is the new currency of communication. Some of you may have come from companies who have gone through a social media journey over the past six to seven years, and you discovered you can get your fingers burned. Because the trouble is, your customers could come back and say nasty things about you on the Internet through social media. It’s good for us as consumers, but it’s not so great for oil companies, for example, who are regarded as dirty industries.
Film is a great way of controlling that, because you’re controlling the message. You’re keeping the social media genie in the bottle. That’s why I believe in what these companies are doing, because there is something wonderful and something rich about social video, about this method of communication. Now, Steve Jobs, the late Steve Jobs said, “I would like to create an integrated television setup that is easy to use. It will have the simplest user interface you could imagine, and I finally cracked it.”
Steve Jobs, probably one of the greatest visionaries of our time in the technology industry, saw this coming. He believed that the television was going to become the interface through which you’re going to buy, you’re going to sell. You can have anything you want to consume, at any time you want, wherever it is that you want. It’s not just coming, it’s already here. So we’re going to see a difference.
Now, I love this from Motley Fool. They did this. They effectively put gravestones up as far as some of the industries are concerned. They said the brokerage industry died between the years of 1801 and 1997. Today those of you who trade stocks and shares, you don’t really need a broker. You can just go to IG Index, you can go to Capital Spreads. You can do it online. You can do it direct.
The wonderful about the Internet is that it puts people who are buying things directly in touch with people who are selling things. It’s wonderful. So if you’re a middleman, you’ve got problems if you’re in the brokerage industry. The book industry as we traditionally knew it died, according to Motley Fool, in 2003. The newspaper industry, it is dead. I had a media buyer contact me today, and he said, “You can use all these different media, but I wouldn’t bother using the newspaper industry. It’s history. It’s too expensive and it’s too difficult to do.”
Let me tell you something, there is change. I didn’t say that. He said it. All right, so you can’t blame for that. I have to believe in press. But there is a place there. Someone said it died in 2005. The travel planning industry, if you’re a travel agent, well when was the last time you booked a holiday through a travel agent? I booked my Christmas holiday. I just booked it direct on the Internet. So we’re seeing the death of this. I love what Stuart’s done here: he’s put a Zimmer frame next to television. It’s going to die. It’s on its last legs. It’s going to change, and I’m going to show you what that looks like.
What are we doing? I’m seeing this on a regular basis. This is something called real-time bidding. This is really one of the greatest revolutions in advertising that you will experience over the next five to ten years. You can Google this. You can look it up and you can read about it. What does it mean? Well, effectively what’s happening is if you’re a television advertiser, historically what you would do is you would go to a specialist, they would then go to the TV station. You would buy the adverts in advance. Then they’d go on the television, and then effectively you’d find out how you’d done.
It doesn’t work like that anymore. On the Internet, if I go onto sky.com, for example, the adverts that I get served to me have not been bought in advance. They are in an auction. So in the 0.1 seconds that it takes you to load that website, the whole of the industry has bid for that space, and the highest bidder has won that advert that you see. This is what’s going to happen to television advertising, and it’s already begun, because Sky TV have just changed their television advertising platform to real-time bidding.
So what does that look like for you and I? Well, what it means is that on a Saturday night we’ve got our pizza, we’re watching X Factor or The Voice or whatever it is we’re watching. Then the adverts that you see will not be pre- bought. They will be served to you in an auction in about 0.01 of a second, and everybody is bidding for that spot.
Now, have you noticed, some of you might have noticed that Sky have been placing some adverts saying, “Would you like to plug in your set-top box?” Have you seen Sky saying that? They want you to plug in your set-top box. Why? Because Sky has become a data company. What it wants to do is it wants to find out what you’re watching in real time so it can feed those stats to its advertising platform, so that when you watch an ad break it will serve you perfectly in that particular [??] time. We’re doing this as a company right now. This is not something that is in the future. This is right now. We’re doing it right now.
So what this looks like is, through real-time bidding on various video ad exchanges we bid for a target audience, and also you can do it geographically. So you could just say we want to get people in the Midlands, or we want to get people in Brighton, for example. Are you with me? Is everyone with me on this? Through our platform what we do is we make sure that all of the inventory is aggregated, and then everybody is bidding. Everybody’s in this huge, great auction for advertising.
Can you see now why press is looking a little bit jaded? The days when a month ago you’d write to your local newspaper and asked to place an ad is not quite the same as your ad being placed in 0.01 of a second. On your mobile phone you’re going to see exactly the same thing. So here we’ve got some wonderful examples, and I love what vzaar are doing in terms of the whole way in which video is served to you.
So wait for 5G, which is coming. You’re going to be able to watch, and maybe you’ve watched now, but just here on your mobile phone, or maybe you’ve watched one just here, or an advert looks like this. Or maybe you’ve even seen a whole mobile brand channel, whereby you’re seeing a whole ad that’s blocking out your screen. It’s now, it’s relevant to you, and also it means that you can respond straightaway.
This is effectively the way it works. There used to be a thing that said I know my advertising is working, but I only know which 50 percent of it is working. Real-time bidding has put that to bed. You know now in real time exactly what is working and what is not working. So we have all of the campaign data, we have the interactions, we have the conversions. They go all into your client CRM data. We track the path to conversion. We track who it’s targeting, the frequency. We attributed who’s had this experience online.
So maybe you love gardening, and maybe you’re looking, for example, petunias to buy online. You search petunias, and you find a couple of garden centers. Then you go off and you watch something else, and you keep on getting served ads about petunias. Have you had that experience? You’ve been retargeted.
They’ve tracked you, they know what they’re searching for, and now they’re tracking you. They’re chasing you. That’s called attribution modelling. They attribute you to petunias and then they chase you, one time, two times, three times. Ten times gets a little bit too much for me. I don’t know about you. This is effectively what’s happening, so prepare yourself.
Two more slides. What does this look like for us today? Well, effectively you’re already seeing this. Here’s some ads for Beats by Dr. Dre. Here’s a film promotion here, for example. It’s TV online. That’s exactly what it is. That’s why these companies are just exploding right now. But here is … and you won’t be able to see this … but here is literally a snapshot of my desk last week.
We’re doing an advert for Qatar and Western Australia at the moment, and this is what it looks like. So you’re looking at my audience is ABC, I’m going into London. I’m booking video. It’s an ad unit. I’m going to have 200,000 impressions. My click-through rate is 2 percent. I’m going to get about 4000 clicks. I’m going to get about 1200 Facebook likes. My conversion rate is 2 percent. From that I’ve worked out for my client statistics. So I’m going to get 83 inquiries.
Did you ever wonder how many inquiries you’re going to get for your advertising campaign? We can tell you. We have the statistics for this. How long is it going to run for? About six weeks. Can we turn it off? Yes, we can. Can we turn it on? Yes, we can. The currency is in pounds, and the gross cost per view is going to me ten pence each time somebody views that thing. That’s what this looks like. This is the way that video online, television, is being planned today.
So what can you do? Well, for example, if you’re not using video right now to promote your business, begin, if you haven’t done before. We’ve got some guys here just coming out with incredible learns and perspectives on the ways in which you can do this. Secondly, explore the way mobile and video advertising works, and discover some of the basic ways in which you can use these things to leave a response. I come from the old fashioned place where I believe the only reason to advertise is to sell more than if you hadn’t have advertised in the first place. It just seems logical to me.
Flash, if you’re into your programming languages, we’re now viewing as a dead language. So Flash cannot be seen on iPad, for example. It’s just gone. We’re something called HTML5 now, which is a rich media format which is really quite new in most people’s terms. These guys have been using it forever. Make sure you have a state of the art smartphone or two in the office. Did you know that the bestselling phone in the world is not the Apple iPhone. It’s in fact this. It’s the Samsung Galaxy. This is the bestselling phone in the world. I’m predicting that Android will take over Apple sooner or later. It’s already got a bigger worldwide footprint than Apple have.
So there you go. I hope you’ve enjoyed it, and I thank you so much for the hosting tonight.”