Effective but tired video ad formats and the contenders poised to replace them

The online video explosion shows no signs of slowing. In February, more than 10 billion videos were viewed online in the U.S. alone, and 72. 8 per cent of the Internet audience viewed an online video, according to Comscore.

Unsurprisingly, companies are doing everything that they can to reach this audience.

Research groups such as eMarketer are predicting that online video spending will shortly be in the billions, and by 2011, almost 10 per cent of all online advertising money will be dedicated to video advertising.

With this much money being spent, you would think that the creativity and variety of ads would be flourishing.

However, many online and viral ad campaigns appear to be off the mark.

Futhermore, the majority of today’s video advertising is fairly rudimentary and comes in a number of often-criticized formats that piggy-back on existing advertising:

Pre-roll/mid-roll/post-roll These are the 30- or 15-second video spots that run before (pre-roll), during (mid-roll) or after (post-roll) the online video. This is very similar to traditional television advertising.

Video overlays This type of advertising usually displays along the bottom of a video as it plays. It’s in a shaded box and the video can still be watched when the ad is displaying. This is one advertising format that YouTube employs, and you’ll think it looks familiar if you watch news shows on TV — it’s like the station identification along the bottom of the screen.

Google’s Video Units This format takes Google’s popular AdSense advertising format and applies it to video.

Right now these methods are actually effective, much the way that banner ads were effective in the early days of the Internet.

And since they are working at the moment, advertisers aren’t jumping to spend money on new video formats.

But like with banner advertising, effectiveness will decline over time as users begin to be annoyed that they are being held captive by advertisers before they can watch the video they really want to see (this is what sparked the creation of TiVo, after all). New advertising models that align with the medium will be necessary.

Here are three that could work.

1) Lead generation for video

In the B2B video market (which is still a small chunk of online video overall, but growing), data-collection would allow advertisers to generate revenue with online video. Imagine that in order for someone to be able to watch a video, they have to enter their email address.

Maybe they first get to watch 20 seconds of the video to see if it’s worth giving up their email to watch the rest.

The user likes what he sees, so he comes back another time in the future to watch another video — and this time, he gives up his job title to watch. Overtime, the advertiser will be able to collect a large amount of data on each user — as well as tracking their video viewing habits. This is lead generation for video.

2) Interactive pre-rolls requiring user input on branding effectiveness

More interactive pre-, mid- and post-roll advertising would allow advertisers to use existing creative and get immediate information on branding effectiveness.

Each 15- and 30-second ad would incorporate an interactive component, allowing users to get rid of the ads more quickly if they correctly interact with the video.

Imagine a BMW commercial that shows a small, unobtrusive window over the commercial asking “Why is BMW the best car on the planet?” with an a, b, c or d option for the user to pick to answer the question.

If the user selects “d: Sheer driving pleasure,” which is BMW’s current brand position, they are told they are right, the branding lesson is complete, and the advertisement stops early.

3) Clickable videos that integrate ads with content

Clickable videos that promote products and services are already being tested by Revision3 and VideoClix.

This model is really cool because it uses the Internet’s ability to be interactive, and isn’t based on any pre-existing TV advertising model.

Imagine watching an episode of Sex in the City and being able to click on any purse, shoe, dress or earring, as well as restaurants and bars in the background, in order to find out information about them — including purchasing information.

The video advertising formats of today may be slightly boring and look an awful lot like advertising stolen from other mediums, but not for long. Creative new video formats are already starting to emerge and will be the winners in the future.

Melissa Chang is the founder of Pure Incubation, an Internet incubator based in the Boston area. Her blog is at www.16thletter.com.

Comment: [email protected]

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