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RAd (Responsible Advertising) - An innovative donate-per-view digital video advertising model

Periodic Reporting for period 1 - RAd (RAd (Responsible Advertising) - An innovative donate-per-view digital video advertising model)

Reporting period: 2015-06-01 to 2015-10-31

The so called “legacy media” publishers such as broadcast TV and newspapers (hereinafter referred to simply as media) face incredible challenges while transitioning into the “new media” and the digital space. Traditionally, advertisement has always played a key role in balancing out the financial scale for media but with the transition to digital and the dispersal of advertising revenue to non-editorial and social media giants such as Google, Facebook and Youtube, risk of long-term advertisement revenue losses increases dramatically.
Digital video advertisement (DVA) is experiencing exponential growth with a €1.4Billion market value predicted for the UK alone in 2017. RAd (responsible advertisement) is an innovative DVA product that combines advertisement with Corporate Social Responsibility. Rad connects media publishers and advertisers, with non-profit organizations and end-users in a win-win “donate-per-view” interaction model where end-users support non-profits through their ad viewership.
The goal of this action is to assess the feasibility of RAD by combining market analysis and strategy development, with a field pilot ran together with Norwegian broadcaster TV2 to test and refine the proposed business model. The project will run for 5 months and result in a feasibility report that will include all the results and raw data collected throughout the project, the main conclusions extrapolated from this data, and the an updated RAD business plan.
During this feasibility study we successfully executed on all the 3 tasks proposed:
• Task 1: Analyse the EU Digital Video Advertisement Market
• Task 2: Run a Rad pilot and collect data
• Task 3: Evaluate results, write the feasibility report and business plan
We conducted a thorough market research focused on the Norwegian and UK markets and ran a first Rad pilot in a live setting with TV2 (media publisher), Orkla’s Vitaminbjorner (brand) and Sykehusklovenene (non-profit) with very promising results.
These 2 activities combined, allowed us to gather extremely valuable knowledge and update our business model and go-to-market strategy, while strengthening our relationships with all the entities involved in the pilot.
The RAd pilot showed a highly promising 30% video completion rate, and the growing interest in the product translated into the signing of letters of intent between RAd and its pilot partners.
Our business model was also updated together with the corresponding financial projections and potential impact until 2020.
As we ran this feasibility study, we grew more and more confident that RAd has the potential to become the reference for this new model of advertisement, setting the stage for further innovation in this space and becoming a world-wide-known brand and standard for “responsible advertisement” or “socially conscious advertisement”.

In a nutshell, during this feasibility study we were able to:
• Gain a deeper understanding of the European Publishers, Media Agencies and Non-profits by running a thorough analysis of these in Norwegian and the UK (boundary markets in the top 10 list).
• Confirm the promising efficiency of the RAd “donate-per-view” format showing a 30% video completion rate as per our pilot results.
• Based on the market analysis and pilot results, update our business model and go-to-market strategy.
• Secure interest of continuity from all the players involved in the pilot as well as additional players in the form of signed letters of intent.
• Make an informed decision to continue the project and to secure the necessary resources to do so in the form of further investment from ourselves and an application to SME Instrument Phase II.

According to our latest projections, we expect that in 2020 we will be able to:
• Bring over 20 Million Euros into the non-profit sector in the UK and Nordic markets and contribute with resources that will touch and improve the lives of a lot of people through non-profit activity.
• Capture 178 Million Euros of digital video advertising purchases towards Media Publishers and contribute to the financial stability of the media publishing industry. Not only important for the survival of all its associated jobs, but also for society in general, revamping the media's financial independence and ability to carry out its functions as a watchdog of democracy.
• Establish a business operation with a revenue of 5.35 Million euros.
• Create 25 new direct jobs within our organisation.

We strengthened our belief that Rad has the potential to impact the way we think advertisement altogether, reinforcing the EU’s role as an innovative region and though leader on cross-nation and cross-industry innovative thinking.