Blog | Advertisers
November 13, 2015

VOD - Monetizing Content From The C3 Window To D4

Renee Ingenito, Executive Director

In a time not too long ago, monetizing content was easier. Linear content was broadcast, ratings were taken, commercials were aired, and money was made. In just a few years, monetizing content has become increasingly complex. Time-shifted viewing, video on demand (VOD), DVRs and online streaming have changed the way content is consumed. In fact, 53% of all viewers - and 61% of millennials - watch time-shifted programming.[1] The last stat is of particular interest considering that millennials are a generation more likely to cut cords or never have one in the first place. This makes VOD even more important to capturing, and keeping, this demographic.

On demand advertising models have undergone some of the most drastic changes as part of this shift. Instead of simple ratings on linear broadcasts, we have many windows and potentials for monetization. Let’s break down and define the windows and the opportunities that exist for each:

1. C3  For the first three days after content is aired live, it is pitched to VOD servers with its original ad load and Nielsen watermarks. This allows on demand views in the first three days to still be counted in the original impressions. Considering 40% of VOD viewing occurs in the C3 window, this added viewership has resulted in a significant lift to originally aired programs in recent months.[2] For example, Fox’s premier of Scream Queens, targeted at millennials, received a 53% lift in the first three days on demand.[3]

2. C7 – Similar to C3, C7 is a combination of average commercial linear broadcast and the first seven days of time-shifted viewing. According to Ad Age, C7 measurement is gaining ground with 11 new shows earning up to a one-half point rating increase or more at the beginning of the 2015-2016 season. Fox’s “Empire” even touted a 1.5 point increase in the C7 window.[4]

3. D4/Dynamic Ad Insertion (DAI) – After the C3 or C7 window, assets are prepared for D4 and DAI.

Sixty percent of VOD viewing occurs in this window. Therefore, a lot of opportunity exists during this time to increase ad impressions. Until recently, this critical window was not optimized by advertisers, as C3 ad loads were stripped out and a static ad placed in the ad breaks across the VOD asset. This ad usually remained for its life of the VOD asset, clearly limiting advertisers’ ability to capture potential viewers or target advertising to specific audiences.

Recent advances in technology and support from providers have opened doors to ad insertion after D4. Now, ad breaks can be rapidly inserted and ads changed out in VOD assets. Research has shown that this approach is extremely effective. Eighty percent of impressions are now viewed in mid-roll and the DAI ads contributed to a 22% increase in relevance and 37% lift in intent to recommend. These statistics are not lost on content providers who are accelerating usage of this new advertising venue. By October 2015 more than 7.7 billion DAI ads had been delivered, compared to 6.3 billion ads throughout all of 2014. Given that total DAI ads were only 1.1 billion in 2013, this trend only seems to be growing exponentially. [5]

4. C3 DAI – This is one of the newest methods of on demand monetization that enables ad breaks to be marked in the C3 window. This feature gives viewers the option to fast forward through content – but not ads – so they can come back and finish viewing a program later. It also enables local spots and promos to be switched out in the C3 window. In addition, C3 DAI facilitates the insertion of a second Nielsen watermark, which allows Nielsen differentiation of DVR versus VOD spots.

As you can see, more options and technologies exist to facilitate advertising on demand than ever before. With the growth of monetization opportunities along the entire lifecycle of a piece of content, managing the process and technology can be complicated. However, if executed with experienced partners, these technologies offer a fertile ground for advertisers, choices for viewers and more ways for content providers to extend the value of their programming. 


[1] Source: Time Shifting: February 2015, Hub Entertainment Research

[2] Sources: Rentrak Custom Report, June 2015