Steve Sos.
With analysts projecting advertising to grow in 2025 after a bumpy year in 2024, Vevo is aiming to take a piece of the ad dollar pie, positioning itself as a brand-safe, premium option for those focusing on mid to upper funnel marketing tactics.
The music video network now has a monthly active reach of just shy of 12 million Australians and rounded out 2024 with its fifth consecutive year of growth in the region.
Now, as it kicks off 2025 after finishing with record revenues in both November and December, Vevo APAC MD Steve Sos said advertisers are looking to the company to achieve brand awareness and quick reach based on scale.
“If you think about the notion that revenue follows eyeballs and look through the lens of the content pillars where money has always flowed – news, scripted and reality shows and sports - music has historically been that fourth pillar but for many years it was really niche,” he said.
“The barriers to entry, even for music as a category, used to be that you had to set up channels if it was subscription TV, or on free to air, music tended to get relegated to midnight or weekend mornings.
“That's all been democratised now and all those barriers to entry have gone, so it means what used to be really niche audiences are now mass audiences and music is rightfully taking its place alongside those other three pillars.”
Part of those “mass audiences” are not only helping to drive the 25 billion views globally the platform’s content draws each month – and in the last 12 months in Australia, music videos from the 2000s and 2010s were viewed 450 million times and 1.1 billion times respectively – but also interest from advertisers.
Sos said that alongside contextual products and first impression takeovers, some of the biggest numbers advertisers reap in terms of ROI are associated with sponsorships of new release content.
“We have brands that will come in and go ‘I want to own the new track from a particular artist’, and they tend to then also own the catalogue; when an artist releases a new video, we see a lift in the whole catalogue,” he told AdNews.
Run as a joint venture by Universal Music Group and Sony Music Entertainment and operating in over 50 countries, the local team of Vevo - comprising of around a dozen people - not only counts YouTube as its biggest distribution partner, but also has eight channels on Samsung TV Plus, along with another four on Foxtel that were launched last year.
As an online-first platform, it may be expected that Vevo would try to draw eyeballs away from other locations on the internet, but the music video network’s sight are squarely set on the TV and streaming arena.
“We know linear television is challenged in terms of delivering younger audiences these days; for Vevo, nearly two thirds of our local audience is 18 to 44,” Sos said.
“As licensing windows expire, you're going to see content owners take that content back and the knock-on effect then becomes ‘what does that mean for subscriber levels on that platform?’. My view is we tend to be content loyal rather than platform loyal, so if something moves from platform A to B, I might cancel A and pick up B, or if I've already seen that show, I'm not going to pick up A or B.
“When I contrast that to ourselves and the fact that we've got this constant flow of content coming from our label owners and the fact that we've not been impacted by issues like writers strikes, it puts us in a really good place.”
At last year’s Upfronts event, the network unveiled how its library of nearly one million music videos makes up less than 1% of the content on YouTube, but reaches 57% of that platform’s viewers every month, along with advertisers getting 5% to 12% incremental reach when buying ads on Vevo in combination with YouTube.
Sos said that despite a lot of new entrants in the streaming market – Amazon, Max and Disney among them – those platforms are challenged for scale.
“We aggregate a bigger audience than all of the ad-supported BVOD market combined and we're a single ad impression in that YouTube environment,” he told AdNews.
“We don't do any mid-rolls and we don't do any post-rolls, so there's a really good trade-off between a small piece of commercial content - 6, 15 or 30 second pre-rolls - and a three-to-four-minute music video.
“Given we're really competitive on price, we tend to be at the low end of BVOD pricing, but more expensive than your traditional YouTube Select. We would argue our content is every bit as premium and valuable as an episode of Home & Away, Masterchef or any other tentpole programming.”
Sos said another reason why Vevo has seen continued growth in market is down to the cultural relevancy of music videos.
“There's a lot of brands looking to tap into cultural moments, but cultural moments tend to sit predominantly in two categories: music and sport,” he said.
“There’s some breakout hits in scripted drama - like Stranger Things or Squid Game - but the consistency of cultural moments belongs to those other two categories.
“This time last year around Taylor Swift, the amount of brands that looked to tap into her fandom and re-badge products or launch product lines serves as a really good moment to reflect on how powerful the context is. There's something to be said for the credibility via association that comes from brands running ads alongside the biggest and most recognisable stars on the planet.”
Looking ahead to what’s on the horizon this year, Sos said not only will the local team continue growing, but that there’s product innovation in the pipeline too.
“A big focus this year is on even more research and going deeper on validation points,” he said.
“Some of that will be through a collaborative approach with the Video Futures Collective and some of the other partners involved there, but also some bespoke research that we look to commission outside of that around attention-based metrics and validating the value of a single ad impression versus being in a pod.”
Vevo is also eyeing further expansion in the APAC region, having only launched into Southeast Asia 15 months ago.
“For markets that are very price driven, it's about picking the right brands and expanding the client base. We're operating in probably seven or eight markets there, but the two big growth areas for us are Japan and India over the next 12 months.
“It's always been a very mobile driven market - they sort of skipped desktop, went straight to mobile - but CTV is fairly nascent and growing. There's some distribution partners in certain markets where the economics make sense to expand distribution in those parts of the world.
“More broadly, we've done a lot of work on contextual, making sure that should the cookie ever deprecate, we're really well placed. Contextual sits really well with where we sit in the funnel and some of those key metrics, so we'll look to launch some more products in that space in the year ahead.”
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