IAB Europe Interact 2017 – Interview with Rhys Noelke, Senior Vice President Strategy, RTL Group: The News Rules of Engagement
As the last minute preparations for Interact are put in place we are delighted to bring you some perspectives on the key topics. We interviewed Rhys Noelke, VP Strategy, RTL Group on what might the News Rules of Engagement. Continue reading…
Q:‘The new rules of engagement‘ is the theme for Interact this year. How do you interpret the theme and how important do you think it is for the industry this year?
Rhys Noelke: For RTL Group, the rules of engagement have changed significantly. For us, ‘TV’ does not mean television anymore. We have redefined the term, as we are moving towards a ‘total video’ eco-system. This means we need to embrace all kinds of different types of video content and platforms. We want to drive the industry forward, by engaging with all audiences, platform and content partners, as we have done by investing into multi-platform networks on YouTube.
As online video publishers, we are all sitting in the same ‘digital boat’. I expect some more storms out there in the video world, and I absolutely believe that our industry can only move forward if we tackle these storms together – whether they are about regulation, consumer protection or building more trust in the digital advertising business. I am very excited to have the opportunity to debate this and drive it forward with an industry body such as IAB Europe.
Q: What do the new rules mean in terms of an improved consumer value proposition which can drive engagement? How do you see this working across channels?
Rhys Noelke: We need to focus on our consumer proposition, as the industry needs to respect that consumers expect value from publishers and content providers. The consumer doesn’t care about the underlying economics or how we deliver it, whether it’s an ad-funded or pay business model. Consumers want to understand clearly WHAT they can expect and HOW they can get it, in order to accept the rules of engagement. I really don’t think users will oppose smart advertising, if the proposition is clearly explained and they can choose whether they pay directly or indirectly – for instance by giving consent to data usage.
That’s why I think total video also means total consideration of the viewer’s needs.
Q: Is a different proposition and strategy needed for a younger demographic?
Rhys Noelke: Sure – at RTL Group we have invested in globally leading multi-platform networks like BroadbandTV, StyleHaul and Divimove, catering specifically for younger audiences. We think the fundamentals of these networks – content aggregation – are very close to the broadcasting model, which we have shaped across Europe. And they are growing at a significant rate. With our platforms, we generate 26 billion video views a month on YouTube, with nearly 90,000 creators. This is the ultimate fragmentation of channels: young audiences love to engage with their favourite talent directly. This offer has its own rules, its own language and is quite different to an 8pm prime-time show.
Q: Thinking about the transition from traditional media engagement to digital engagement what are the opportunities for the advertiser and what are their expectations?
Rhys Noelke: In a way, advertiser’s today are spoilt for choice as there are so many ad opportunities and platforms out there. But as rich as the choice is, the outcome and return on investment are not that clear. Digital advertising has some bridges to cross to clarify its accountability across screens, formats and platforms.
It is a big challenge to bring this together in a converged world, but this is what we need to achieve as an industry to keep advertisers’ confidence.
The sheer amount of offers will increase. Today nearly all traditional advertising offers are transforming to digital. Just think about digital ‘Out of Home’ or ‘Below-the-Line’ marketing. TV distribution nowadays is fully digitised, but we are still lacking the ability to extract the data and measure it on a comparable basis.
Q: What’s your take on the current discussions on transparency and brand safety?
Rhys Noelke: I think there is still a lot of work to do. The digital industry and associated intermediaries have been accused on the one hand of not being transparent. But on the other hand, advertisers have high expectations for competitive pricing, viewability or frequency. Relevant context and quality content are holding up strong, so we need to explain the benefits to advertisers and make them understand that our serious investment in content cannot be refinanced in the range of cent CPMs. Just to be clear: all advertising on our TV channels is brand safe. I am 100 per cent aligned with what NBC Universal’s Linda Yaccarino said at the Upfronts 2017: with our channels ‘you never have to worry about your ads showing up next to something objectionable.’
Against the background of the ongoing digitisation, we need a strong European perspective to counter the digital giants from the US. In the end, the trade-off between globalisation and more regional approaches demands new rules of engagement.
As an industry, we can build more confidence, for example with standards illustrated in the ‘Coalition for Better Ads’ or other initiatives at IAB. We can prove value.
Q: Lastly what do you need to develop in your organisation in order to implement an effective digital strategy?
Rhys Noelke: Firstly, the overall goal is to protect our core business and to act as an innovator at the same time. No doubt, this is a cultural challenge. When we launched RTL Plus, one of the first commercial TV channels in Germany, more or less out of a garage in Luxembourg, its success was not that certain, but it was driven by a strong pioneering spirit.
You obviously need a leap of faith to build new things which don’t seem feasible at first. For us, it’s clear that we want to be strong as a European TV network, but at the same time, we need to move heavily into online video content and also media technology. It’s very similar to the launch of commercial television in Europe in the 1980s.
Secondly, future monetisation strategies require thinking outside of the box. When we acquired SpotX some years ago, programmatic advertising was seen as threat to traditional sales. We took that risk, and see the benefits and the know-how transfer in our organisation today. We have continued on this path by investing in more ad-tech driven businesses like Smartclip, Videoamp and Clypd.
Thirdly, it’s about people and skills. Today we already have hundreds of digital native managers, software engineers and data-scientists in our Group.
All of these elements are key to delivering a future-proof strategy.
Rhys Noelke, Senior Vice President Strategy, RTL Group
Rhys Noelke is Senior Vice President Strategy at RTL Group’s Corporate Center in Luxembourg. RTL Group is the leading European entertainment network with 60 TV channels, 31 radio stations, the worldwide production company FremantleMedia as well as digital businesses across the Group and in US.