• by Mark Moore , September 8, 2008

Neighborhood businesses face special challenges as they promote their products and services to their local communities. Local newspapers are fast disappearing as consumers go online for information and entertainment. Internet video consumption is exploding, but local businesses often lack the IT expertise to effectively target their audiences online through search optimization, and there is limited inventory for online video ads.

Self-Serve Tools Make TV Advertising More Affordable for Small Businesses

Historically, local advertisers that have been able to afford video advertising have favored cable and satellite television to target their audiences geographically and demographically. However, the budget and resources required to produce and place TV ads makes them prohibitive for many small businesses. The prospect of hiring an agency or professional video consultant and dedicating the time to develop content are beyond what most local businesses can handle. And, to effectively create brand awareness, a local advertiser needs repeated exposure for its product or service.

Emerging tools for Internet video ad creation are leveling the playing the field for these local advertisers. Small businesses owners can now quickly and easily create professional quality Internet video ads of flexible length using any mix of photos, video clips, advertising copy, narration, and music. These video ads can be deployed for TV and online advertising alike.

Other barriers to TV advertising are falling as well. For instance, Google TV ads enable businesses of any size to book TV advertising online, without agency mark-up, and compete against other advertisers for available inventory on a given network in a given local area. Advertisers pay based on performance (number of impressions). In this way, local businesses can reach their local audiences without committing to sizable advertising budgets. Once they've examined the impressions received and the results of promotional offers, it's easy for the local advertisers to modify their video content or targeting strategy.

Geographically Targeted Online Video Ads: Still in Development, but Directories See An Opportunity

Forward thinking local businesses are realizing the benefit of reaching consumers with a compelling video message when and where they are searching for a product or service. According to a June 2008 Cisco forecast, "in 2012, Internet video traffic alone will be 400 times the traffic carried by the U.S. Internet backbone in 2000. Representative of this trend, Internet video has jumped from 12% of the global consumer Internet traffic in 2006 to 22% in 2007." These statistics make a compelling argument for any advertiser, large or small, to employ Internet video as part of its marketing mix.

Online directories currently offer the best opportunity to properly target a local audience. According to a June 2008 study from The Kelsey Group, there is "growing interest among Yellow Pages publishers in adding video to their local sales bundles." According to The Kelsey Group, nearly 17% of consumers surveyed that saw a local online video ad made a purchase.

Younger consumers are accustomed to viewing video content is short, sharable, and optimized for the social networking environment. Reaching a local audience on social networks and video sharing sites can be tricky, however. Social networking communities are not necessarily composed of consumers from the same geographical area, and consumers on social networking sites often consider advertising to be intrusive and automatically tune out any overt promotions.

Similarly, video sharing sites such as YouTube are not oriented around geographical location. Nevertheless, these online communities are too important for any advertiser to ignore. According to comScore estimates, Americans watched 11.5 billion online videos in March 2008, including 4.3 billion views of YouTube videos. Consumers that actively share online content rely heavily on recommendations from within their social networks, particularly from opinion leaders.

Local advertisers that can create online video advertising that communicates their value propositions in an engaging, useful manner may have much to gain if these influencers either post, advocate, or share their content with friends and family. We believe that video sharing sites will build out advertising programs that will be attractive to local advertisers.

Integrated Marketing Isn't Just For Major Marketers

In the past, local advertisers could not consider launching the kinds of integrated marketing campaigns often deployed by large advertisers, due to budget and resource constraints. With the advent of cost-effective, easy-to-use self-serve Internet video creation, small businesses can now leverage existing content for use in a variety of media.

For instance, radio ad copy can be repurposed for online video, accompanied by photography created for brochures and display ads. Because Internet video ads are so much easier and faster to create than traditional videos, they lend themselves to customization and optimization for the specific channel. For instance, a local advertiser can include more interactive features in the online version of an ad, such as clickthroughs to a Web site or coupon download, while the TV version might include longer video footage that will benefit from the impact of a larger screen.

As consumers begin downloading full-length video content to their mobile Internet devices and TV content becomes more interactive, the lines between TV and Internet content will begin to blur. According to the Cisco forecast, "Internet video to the PC screen will soon be exceeded by a second wave arising from the delivery of Internet video to the TV screen." A 2008 study conducted by Ipsos MediaCT indicated that "at least three in four digital video consumers say they would find it 'reasonable' for advertising to be included in the free digital distribution of full-length TV shows and movies." This constitutes a strong argument for creating professional quality Internet video content that is flexible enough to be adapted for a variety of different platforms and levels of interactivity.

Streamlining online video creation also enables local advertisers to employ sophisticated iterative marketing techniques, changing the content of a video ad in response to customer behavior. Instead of waiting days or weeks to evaluate the effectiveness of a marketing campaign, local advertisers can begin measuring results immediately and change content in real time to reflect special promotions or seasonality.

Newly Accessible and Affordable, Video Advertising is an Essential Tool in the Local Business Toolbox

The self-serve model for video advertising puts small businesses in control while delivering more efficient and effective use of every marketing dollar. Now, any local businesses, regardless of size, can create awareness and generate interest by creating and distributing compelling rich media that engages audiences while communicating its value proposition.