Yesterday, Ariel Dos Santos (@agds) tweeted the following video:
It’s an “ad” for TNT which is a new TV channel in Belgium. I wrote “ad” because we don’t experience it like an ad. It’s entertainment. Not only that, but it’s entertainment that’s finding it’s way around the globe via word of mouth and sharing. You can see how it’s grown here:
A couple of things about this content that are truly awesome. First, look at how incredibly fast this video has spread. Yesterday when I saw it for the first time, there were 4M+ views of it. 24 hours later, it’s up to 11M+ and counting. Since it was posted for the first time three days ago on Facebook, it has generated 11M+ views. Second, it is awesome to see how the content attained truly global reach. In three days.
Obviously, TNT spent a considerable amount on creative and production. I have no idea how much but I’d guess it’s in the $1M USD ballpark: fees for the agency, actors, town, crew, editing, etc. I also have no idea if they’re running any advertising (paid media) to promote the video as well or if what we’re seeing in the #s is 100% organic. Assuming they are not, then the media cost to drive the distribution of and engagement with the content is $0.00.
Looking at this, we wondered what the “media value” of a viral video of this sort actually is. Using some of the data generated by the Meteor platform every second of every day, we know there is roughly a 3X increase in engagement and conversion rates among users that receive content from a friend or other trusted source. We’ll call that the “Earned Multiplier”. Now if you assume as we do that there is no paid promotion going on of the video ad itself, then the arithmetic required to estimate the value of this viral video over time is pretty straightforward. I’ve built a simple model complete with major assumptions to show how we convert viral video views into media value that enables apples-to-apples comparison with alternative forms of “paid for” media distribution (aka “Video Ads”). As you can see from this model, when the content gets discovered and sharing ensues at scale, the impact and ROI that results is phenomenal.
A few points on the above model. Since it’s 3 days and counting into the life of this video online, we do not have enough data to project what the spread of the content will look like going forward. I took a conservative view and said it would continue at it’s current rate of 7M per 24 hours for a few more days and then tail off. You can play with the model yourself by changing the assumptions in yellow so have at it.
Here’s a chart of showing the relationship between the costs (100% fixed and upfront) and the media value which is a function of sharing and essentially free. Another way of saying this is that there are significant fixed costs upfront and virtually no variable costs.
Cost of Production = HIGH
Cost of Distribution = LOW
In short, if you accept the validity of the assumptions I’ve built into the model then it appears the media value being generated by this viral video will exceed the production costs (total cost) sometime today and will continue to grow going forward.
This is a prototypical example of how social entertainment can be used to activate networks of consumers at massive scale. There is a clear and demonstrable ROI. The “art” in all of this is creating content that is entertaining AND easy to share.