Commentary

Online Video Advertising, Successful and Perplexing

by P.J. Bednarski , Staff Writer, July 22, 2013

There is cottage industry seemingly devoted to explaining why online video ads are more effective than just about everything, and another cottage industry that will patiently explain why they are notoriously ineffective. If you reside between those two cottages, you can easily see through both houses a little bit.

One cheery piece of new research from Rocket Fuel, a programmatic buy firm, says ad agency professionals are having their doubts about the effectiveness of TV advertising. Rocket Fuel’s survey shows 80% of them are spending more money on digital this year. And 7 in 10 believe consumers are avoiding TV commercials more than they did five years ago, presumably, at least in part because of DVRs. They don’t think TV commercials are “working as hard” as they used to.

And yet, what to make of such stats? This was a survey of digital advertising agencies executives who might have been truthful in their answers, but biased in their experience.

I do think their answers are more telling when they discuss online video advertising, about: 60% “recognize there are serious barriers to shifting money from TV” to online.

“Chief among those barriers? Building reach (58%) and prior budget commitments (56%). Other challenges cited by those who agree that there are serious barriers to shifting TV funds into digital video include: agency coordination (31%); converting video assets to online ads (30%); and brand safety (23%).”

You know, little stuff.

Undeniably, online video advertising is exploding. It now makes up 60% of all Web traffic and a lot of people believe that has a lot of room to grow. Online ads are easy to watch, usually enjoyable—in any event, usually not torture—and yet, it seems ads are shot out to so many places that rather than being enthused by the coverage, advertisers are bound to feel a little out of control.

The lack of agreement about how to measure online effectiveness, or the fair cost of advertising is at least in part because of publishers, marketers and advertisers still aren’t sure about how to present commercials in a way that will maximize viewership. The basic conundrum is how many times in a short period of time I’ll endure 15 seconds of advertising for a minute’s worth of content. One extraordinary thing about online advertising is that it is perpetually asking consumers what they think of it—“Is this ad relevant to you?”—or telling you how much longer you have to endure it. Online begs a viewer to watch, but sort of implies they know they’re bugging you. I don’t know if that’s stupid or smart.

pj@mediapost.com

advertising, marketing/branding/advertising

3 comments about "Online Video Advertising, Successful and Perplexing".

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Doug Garnett from Protonik, LLC, July 22, 2013 at 2:27 p.m.
I always hate research based on "advertising agency opinions say...". They're easily maniuplated to say whatever the agency wants. But we need to move past our own blinders. And, honestly I thought this pretty naive: "Online ads are easy to watch, usually enjoyable—in any event, usually not torture—and yet,.." What we need to come to grips with is that while 30 seconds is quite manageable in broadcast/cable, a 15 second pre-rolll seems like a frickin' eternity. Ironically, my sense is that the "lean forward" nature of the web adds a barrier to ad success online. Namely, I'm on a mission online - and I resent a 15 second pre-roll that gets in the way. (In my own case, I skip ANY online video with a pre-roll unless it's extraordinarily important to me.) Interesting points to keep discussing...
Reply

pj bednarski from Media business freelancer, July 22, 2013 at 2:43 p.m.

You find a lot of video--that you want to see--that doesn't have pre-roll? Let me shake your hand!
What I was trying to write, above, was that I agree with you. That's the problem. I have to spend 15 seconds watching a commercial before I earn the ability to watch a one minute video. The difference is that I spend that 15 seconds. You don't. But truly what doesn't have pre-roll?

Rick Monihan from None, July 22, 2013 at 3:42 p.m.

Would you pay to not see an ad? Say - $.05 per ad you could avoid?

Otherwise, how can you justify the delivery of a video of any kind if there is no method of covering the costs?

I, like many other users in the digital space, will close a video if we don't feel the content is worth sitting through a pre-roll. On the other hand, I appreciate getting something for 15-30 seconds of my time rather than having to pay for it.

Nobody has come up with a reasonable alternative to the pre-roll, and I can't honestly say I see anything remotely reasonable on the horizon. On the other hand, there may be options which allow users to purchase back their time from video providers in order to avoid wasting it watching a pre-roll. $.05 to save 15 seconds is $12 per hour or about $25,000 a year. If you make more than $25,000 a year, then saving that 15 seconds may be worth paying for....