The Case for Online Videos

By Gordon Chu | Tuesday, June 23, 2009

Last Thanksgiving, my sisters and I decided to indoctrinate my mother with the holiest of holy – an email address. This was her first (but certainly not her last) and really her first introduction to what she fondly referred to as, “the www thing.”

Today, she went from the stone age of non-Internet, to having a Facebook account and selling knick-knacks from around the house on eBay. Today, my inbox is flooded with recipes of her favorite foods, news articles of my old hometown, pictures of kittens in bowls, and, of course, her love for viral online videos (she cannot get enough of how Mentos and Diet Coke react).

While I do not have the patience to scour all through Youtube, I am deeply fascinated by the behavior of online videos and avid viewers, such as my mom. She encompasses why Youtube exists (despite still operating at a loss) and why online videos is the media channel of the future.

China has more than adopted the way of online videos. Online is more than merely an option to consume media, it is where all eyes and brands are focused – where media begins, and where media ends. It is engrained in the culture of China’s youth and is as regular of an activity as getting a Starbuck’s coffee or checking your email.

Several weeks ago, we had talked about the sheer size of China’s Internet market to the tune of 298M users (and growing). What we did not make mention is just how much of that Internet use was consumed by video watching. In fact, online videos is the 3rd most utilized activity (behind instant messaging and online music) and eclipses even the viewership of television for certain demographics. To put things in perspective – Youku, China’s leading video sharing site, has more than 50% market share of online videos. Throw in Tudou, 56.com, Tencent QQ, all of a sudden, the whole world of online videos just got that much bigger.

Brands have most definitely taken notice of this whole online phenomenon. Online marketing campaigns are not just an ancillary business to television’s bread and butter – but are an absolute staple to any successful marketing penetration in China. Beyond the sheer volume of viewers, there are other beneficial advantages to why brands are migrating online.