Hulu revamps ad pricing model

Online television network Hulu will charge advertisers only when a video stream is fully delivered, said Jason Kilar, Hulu’s CEO, during his keynote at the Ad Age Digital Conference in New York City.

“For all ads Hulu sells,” Kilar said, “we’ll bill only when the ad is completed.”

Kilar also emphasized Hulu’s baked-in tools for marketers looking to advertise on the fast-growing network, which had 2 million paying Hulu Plus subscribers as well as $420 million in revenue, growth of 60% from this time last year.

Unlike television set-to-boxes, which look at demographic data on a household-by-household basis, Hulu is able to assess viewing history of an individual over numerous shows. This enables more granular knowledge about specific viewers. For example, Kilar said, “We can look at the shows you’ve logged in and know with 90% precision your gender.”

Hulu also found that asking people whether ads are relevant or not to a specific viewer can add precision to targeting. When someone gives a negative answer, Hulu suppresses the ad. Hulu also lets viewers select what type of ads they prefer viewing.

Finally, Kilar spoke about a recent Hulu tool: Ad Swap, which lets viewers change streaming commercials. “The [brand] being watched before doesn’t get charged,” Kilar said. “The other [brand] gets charged. It’s a big win for everyone.”

Hulu’s advertising tools arrive just after analysts began to question whether the company could incent television networks to make content more available.

Hulu’s news follows AOL’s announcement that it would guarantee audience delivery for video advertising campaigns.

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