With Katie Couric, 'Community' and Simon Cowell, Yahoo Hopes for Hits
Maybe former "American Idol" judge Simon Cowell can do for Yahoo what he did for Fox over a decade ago. At its NewFronts presentation on April 27, Yahoo will pitch advertisers on his reality competition show about electronic dance music D.J.s , according to media buyers familiar with Yahoo's plans.
"Simon Cowell has a proven success rate, so I think there's definitely potential there if they get the right idea," one agency executive said. "So much is serendipity. Who knows what's a hit until we see the quality of the product?"
But the definition of a video "hit" is changing fast. Advertisers have seen Yahoo produce successful series, such as the short-form comedy "Burning Love," but that was before Netflix's "House of Cards" raised expectations for how big an online show can be. Now media buyers are looking for similarly high-profile programs that will merit moving their budgets from TV to online.
"We're pushing the industry to take swings that are a little bigger, and we think that what [Yahoo has] done so far is good," said DigitasLBi Senior VP-Media John Tuchtenhagen. "But we're challenging them to take much bigger swings with content to drive a much bigger audience."
"Yahoo is going to get their fair share" of growing video ad budgets, mostly because of its audience size, said DigitasLBi Senior VP-Media John Tuchtenhagen. Unique U.S. visitors to Yahoo's video service Screen totaled 23.8 million in February, up 22% from the year prior, ComScore said.
But Yahoo's video programming isn't yet seen as a must-buy for marketers. "They should be, but they're just not," said Gian LaVecchia, managing partner-digital content marketing at MEC North America.
Part of the problem is that media buyers are struggling to discern Yahoo's video strategy given the breadth of its content. Yahoo has original shows like "Community" and "Sin City Saints"; Katie Couric's interviews with politicians, business leaders and celebrities, which have combined for more than 100 million views since June, per Ms. Savitt; live daily concerts produced with Live Nation; and shorter videos syndicated from companies such as the NFL, BuzzFeed, ABC News and Condé Nast. There just aren't any obvious tentpoles to compel a brand to throw its wallet at Yahoo.
Yahoo's deal for the "Saturday Night Live" clip archive received a lot of attention two years ago as one of CEO Marissa Mayer's first content deals, but the enthusiasm appears to have faded even internally. "I'm not entirely sure why, but it's not something they generally bring up or push," said Vizeum's digital activation director, Tara Sadlak.
This year is about expanding the video plan described at last year's NewFronts, Yahoo CMO Kathy Savitt said in an interview with Ad Age. Yahoo plans to broaden the programming on its Yahoo Live channel, which has surpassed 101 million views since debuting last July, according to the company (it declined to disclose monthly views). It will grow beyond music to also include live news and live entertainment, Ms. Savitt said. And its 13 digital magazines are turning from text-heavy sites into video centers. "These are all properties that are doing seven figures [in views] an episode that we're going to expand into major channels," she said.
Since Ms. Couric began doing interviews full-time for Yahoo in June 2014, quarterly video streams of her content have grown from to 36 million in the first three months of the year from 4 million, the company said.
But it's Yahoo's long-form original series -- "Community" and "Sin City Saints" premiered last month and a third, "Other Space," debuts TuesdayApril 14 -- that could have the biggest impact.
A hit show could help Yahoo bait advertisers into broader buys, as TV networks are able to do, Mr. Tuchtenhagen said. "Let's say Yahoo literally had 'House of Cards' or 'Game of Thrones,'" he said. "Every buyer would say they have to be in this."
Yahoo is starting to come close, though. Last summer's decision to pick up "Community" after NBC cancelled the sitcom "was a brilliant acquisition," Mr. LaVecchia said. While its audience was modest for TV, the show's name recognition and built-in audience spurred Honda to sign on as the season-long presenting sponsor and Verizon to buy ads against episodes.
Other brands have bought into Yahoo strategy. Kellogg's and Citi have sponsored Yahoo Live, and earlier this month Kia premiered a six-episode branded series there on Yahoo Screen. Yahoo's acquisition of video-ad exchange BrightRoll has also given it even more eyeballs to offer advertisers and made Yahoo "a suitable replacement for some TV dollars," Ms. Sadlak said.
The timing of Mr. Cowell's upcoming series may serve as one test for how successful Yahoo's originals strategy has been in winning over advertisers. The show isn't slated to premiere until next year -- but one agency exec said it could debut earlier if a brand "is dying to have it.