Online video ads more effective than TV ads

A recent study by Millward Brown points to some surprising results: online video ads are more effective for brand awareness and recall than TV ads. Reasons include a less cluttered ad space and more attentive users.

ClickZ reports, "The study compared reactions of viewers to 30-second ads shown during network shows viewed on television, DVR and online. While TV and DVR viewing resulted in 54 percent brand awareness among the ad watchers, the survey found online viewing led to 82 percent brand awareness.

Ads placed online drove even higher brand recall: 18 and 19 percent for TV and DVR viewing, respectively, versus 77 percent for online viewing. In addition, while around 70 percent of TV and DVR ad viewers linked the correct brand to a commercial, 93 percent did so if they watched the ads online."

Mark Loughney, vice president, sales strategy & research, ABC commented, "The results of the Millward Brown CTV1 Study provide independent confirmation of our own research that we have been sharing with our advertisers on ABC.com. Sole sponsorship of programs in the "leanforward" online environment provides an opportunity for our partners to connect with passionate fans of ABC shows in a uniquely engaging environment."

The coming onslaught of video sites

Last week alone several projects were announced that point to a massive increase in niche video sites.

A company called The Next New Network announced plans to launch 100 sites. "Next New Networks plans to blend elements of old and new media into a type of hybrid entertainment that is different from traditional television and user-generated sites like YouTube. Its various Web properties will revolve around professionally produced videos of three to eight minutes, which it plans to pitch to sponsors as safe and predictable places to advertise online."

MTV announced plans to build thousands of new sites. "It aims to build Web sites related to every personality and aspect of its shows, hoping to catch viewers wherever they happen to be on the Internet and on mobile phones."

Hearst is launching 12 new video sites to support its magazines. "The video content will include behind-the-scenes footage from cover shoots, red carpet video, product reviews, recipes, hair-and-makeup "how tos," user-generated video, and more. Opportunities exist to run interstitial and pre-roll video ads near the player."

The William Morris talent agency announced it will be building a site for each of its stars, of which there are around 3000. "The super-agency is teaming up with an Internet video-streaming company to actually create TV-quality programs for consumers to watch on computers, cell phones and other gadgets like iPods."

As more and more sites are created around video assets there will be a huge increase in inventory and thus a decrease in ad rates.  As Cory at Lost Remote points out this will "ultimately lead to consolidation and the creation of vast video ad networks. Long-form advertorial and advertainment video will become the norm, but many online video projects will be abandoned because of low return."

2007 is shaping up to be an exciting year for online video and online advertisement.

Lack of online video inventory

Ad Age reports that while demand from marketeers is high there is a sever lack of online video content. The article sites four reasons holding online advertising back, "fragmented audiences, limited inventory, a lack of video created specifically for the web and a still-evolving ad-buying model."

Online video advertising accounted for just 5% of the $20 billion dollar interactive media market in 2007.  That $775 million does not include brands going direct to consumers with offerings like Anheuser-Busch's Bud.tv.

Daily news developments point to companies addressing the fragmented audiences issue, like today's announcement between Viacom and Joost. Ad buying models will surely settle themselves.  The tough part is finding content created specifically for online viewing.

Newspapers beat TV stations for online video revenue

A new report from Borrell Associates indicates that local newspapers are beating local TV stations for online video advertising revenue. The report shows that in 2006 newspapers sold approximately $81 million in local online video commercials in comparison to $32 million sold by TV broadcasters.

Lost Remote comments, "Portals (and other pure plays), network/cable sites, newspapers and even video blogs are beating local TV sites in video innovation and revenue generation. How important is video? Borrell goes on to predict that video advertising will skyrocket to make up one-third of all local online advertising in 2012, just below paid search."

From the report: "The most exciting thing I’ve seen in the numbers is the consumer demand for advertising, which pales in comparison to consumer demand for local news. In the end, the local media company that wins is one that can deliver a wealth of interactive content — especially video — around consumer verticals like real estate, health, automotive and other high-priced items that require lots of prior research."

Long form local video will find its audience as more people look online for deeper information than a 30 second ad or a 15 second pre-roll. No matter what the media outlet is, local is going to be the new black.

Bud.tv and Identity 2.0

Bud.tv launched this Monday only to get hit with immediate feedback as to the egregious registration requirements. While there have been other comments as to why Bud.tv is or isn't the next great thing in advertising, the registration issue cuts deep into an ongoing discussion about the web and Identity 2.0.

For a entertaining overview of Identity 2.0 issues, watch Dick Hardt's, CEO of Sxip Identity, 2005 OSCON keynote address.  I know its old but its still a great starting point.

Sxip's is working with the OpenID group which is a "a free framework for user-centric digital identity; and Whobar for web developers, which streamlines the user registration and login process with Identity 2.0 technologies, such as InfoCard, i-Names, and OpenID."

OpenID and projects like it seek to provide a "user-centric identity where by each website trusts the user, and the user is free to choose any identity agent that provides the appropriate technical functionality. Thus the user is in the middle of a data transaction. This does not mean the user has to approve every tr ansaction, but that the data always flows through the user's identity agent."

Identity management and verification could have prevented Bud.tv from having to invent its own authentication process and allowed them instead to focus on its real goal of providing original content to its target audience.  That's going to be hard enough.

Online video ads annoying?

Does it feel like we are back to the debate over the death of the 30 second spot? With the Google/YouTube hype on online video, advertisers are trying harder to squeeze in a :15 pre-roll.

Media Post published a newsletter today that was short and to the point:

"In 2005, a Dynamic Logic MarketNorms report certified that streaming video delivered nearly three times higher brand awareness and message association, and more than 100% higher purchase intent and online ad awareness than non-rich media ads. Small wonder that eMarketer said the category would grow to 71% last year, to $225 million.

However, when polled late in 2006 by Forrester Research, more than 80% of Web video viewers in the study called in-stream ads -- placements that appear before or after clips -- "annoying," and 75% claimed to ignore them.

What's going on here? Ian Schafer, CEO and founder of Deep Focus, writes that consumers don't like online video ads because they are "interruptive... often completely untargeted and irrelevant." He suggests making online video ads shorter, more relevant and less frequent."

Where and when do pre or post-roll videos make sense? Step back and remember the experience. Users are forced to watch the 15 second ad. Interruptive? You bet. With today's media shifting, trying to force an audience to do anything seems out of touch. It doesn't make sense to bombard users with your beloved 15 second spot.  Keep it capped, short, relevant, and entertaining. Alternatively, give users a choice to watch on their terms.

What metrics are we missing? No one debates the increase in brand awareness and other brand metrics. It is in the acquisition or direct response metrics that things get fuzzy. Online video ads are typically more expensive and lack expected click or sales metrics. Instead, advertisers lean on the companion ad.

We are all still working on the best way to integrate video online. Product placement, sponsorships, rich media, and opt-in options are growing alternatives to the "annoying" :15 pre-roll.

The evolution of UGOV

It looks like MarketingVOX actually got the full report from Screen Digest on user-generated online video (UGOV.) 

From the post: "The user-generated online video market (UGOV) exploded in 2006 and by the end of the year user-generated videos accounted for 47 percent of the total online videos streamed in the U.S.

By 2010, more than half (55 percent) of all the video content consumed online in the U.S. will be user generated, accounting for 44 billion video streams; however, user-generated videos will account for just 15 percent of total revenues, according to Screen Digest."

Report author, Arash Amel, suggested that smaller sites will need to diversify to combat the dominant existing UGVO brands like Youtube and MySpace.

Amel says, "Emerging alternative offerings include online editing, revenue sharing with content producers and hybrid services which offer both premium and user-generated content."

The Desperation of Viral Campaigns

Scott Donaton's article on Advertising Age brings up a point that we all know: most viral campaigns suck. The fundamental reason they suck: "They are not the end result of an actual idea or strategy but are born of a desperate desire to do something, anything, in the new-media space."

Scott looks at the Folger's Tolerate Mornings: "This is Folgers' attempt to appear cool and ironic by offering slow risers such appealing goodies as a wake-up call on their mobile phone from "Lucy," billed as a "sexy way to rise and shine (for the fellas)," or a "boss tracker," in case you want to catch a few z's at your desk. The fact that it's meant to be tongue-in-cheek makes it somehow sadder, like a dad trying to act cool in front of his teenage daughter's friends."

Viral campaigns are so hard to create for brands because the viral aspect relies on the content being edgy, irreverent, graphic and funny.  Those are hard to manage for most brands. The best viral videos have, in most cases, not come from the brands themselves, but rather from the consumers, like the Diet Coke/Mentos videos. Therefore one strategy is to be watchful for consumer content and then have a plan to capitalize on that conversation.

Scott's take away: "Doing something just to do something still leads to nothing."

How to handle citizen marketers

Guy Kawasaki interviews Jackie Huba and Ben McConnell, authors of the new book "Citizen Marketers" and the blog "Church of the Consumer."

Guy asks the pair how companies should handle events like the Diet Coke-Mentos video.

Answer: There are three different ways to respond to amateur grassroots efforts like that:

1. Say nothing and let the citizen marketers have their time in the spotlight. It’s a safe and conservative approach.

2. Use your company website or blog to point to the citizen marketers in the spirit of “what people are saying about us.” This opens the door to ceding control, and that’s a good step. Just remember that citizen marketers don’t follow instructions. This approach requires company spokespeople to have a sense of humor. That wasn’t the case with the Coke, whose spokesperson was quoted in the Wall Street Journal as scolding people for not drinking their precious beverage!

3. Quickly build a program around what’s happening. It can be beneficial but also tricky because it can taint the grassroots nature of what’s happening. Keep it simple. The “firecracker” nature of something like Diet Coke and Mentos has a short half-life. Better to openly solicit ideas from the people or community involved and keep it simple. Follow the lead of the community. And keep the company lawyers locked in a cage.

Branded Entertainment: $7.5B by 2010

Will Waugh at the ANA reveals some data about branded entertainment from a recent ANA publication, "Best Practices in Branded Entertainment: Case Studies and Accountability," by Richard C. Sutton with Barbara Zack. The big data points are, according to PQ Media, branded entertainment will a 7.5 billion dollar industry by 2010.

Will also points to an excerpt from the book listing the ten best practices of branded entertainment:

1. Is it brand relevant and brand positive?
2. Does it build brand awareness?
3. Does it break through advertising clutter?
4. How long is the integration on-screen? Is it long enough for viewers to notice?
5. Is it organic?
6. Can the integration build buzz?
7. Is there a demonstration of your product or service in the program? Or, can the program highlight key brand attributes?
8. Will the program generate positive publicity and media coverage?
9. How does the program relate to the rest of your brand marketing? If it’s an event, does it have a beginning, middle, and end?
10. The prize is ROI. What’s the return on investment? What results do you plan to measure – and how will you do it?

As viewers turn from TVs to the internet for more of their entertainment, brand sponsored content is going to be more and more important for reaching your target audience.