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How the Hulu Redesign Will Bring in More Ad Dollars

September 4, 2012
By Greg Franzese

Hulu might not rank among the top 10 online video sites, but as an ad property, it consistently out-delivers its competitors, running an average of 46.4 ads, totaling 521 million minutes, in July, according to the latest comScore numbers.

As an innovator in the ad space, Hulu has introduced bold but effective features, letting users swap irrelevant ads for ones they prefer and charging advertisers only when their ads are viewed to completion. As a result, Hulu sees higher engagement rates -- 100 percent after it changed its ad charging system, 96 percent before this program -- and thus is able to charge more than its competitors.
 
When Hulu recently debuted its redesign, it made visuals more eye-popping and the site easier to navigate with personalized discovery tools. But MediaPost says the makeover will also lure in more ad dollars.
Better discovery will increasingly make the difference in landing more online video ad dollars. Why? Because online video is only getting bigger and more confusing. By 2016 there will be more than 1.2 million minutes of video flowing through the Web every second, Cisco has said.
 
We've long talked about the problem of content discovery. Nimrod Hoofien, vice president of engineering at Ooyala, said current video discovery tools lack nuance. “Most recommendation engines just suggest the obvious. People really want fresh content they won’t discover on their own," he told VideoMind earlier this year. “A good recommendation system will show you stuff you may like that you wouldn’t find otherwise.”
 
There's also the problem of wading through this flood of content. So much video is available online — 72 hours of content is uploaded to YouTube every minute alone — that it's now a daunting task to find something to watch without a better discovery process. Ultimately, smarter recommendation engines mean engaged viewers spending more time on the site and watching more content — and ads. 
 
Posted in Monetization
Tags online video, online video monetization, hulu
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