• by Eric Franchi , March 25, 2008

Two of the largest growth areas in online advertising have been, and are projected to be, behavioral targeting (BT) and video. BT is a must-include for virtually every digital campaign and is projected to grow to a $4.8 billion market by 2012 (eMarketer stat). Online video is generally accepted to be the medium in which the biggest global advertisers will be shifting much of their future overall ad spend -- sooner rather than later, assuming ad formats keep pace.

Naturally, combining the proven performance of BT with the as-yet-unlocked potential of online video, seems like a match made in heaven. In fact, a full panel was devoted to this very topic at the recent OMMA Behavioral Conference, where I had the opportunity to moderate the discussion. It was interesting to see how feverishly everyone is working on bringing a solution to market, but at the same time, all agreed that a truly scalable BT solution for video is still likely one to three years away.

Why is this? There are three key reasons; let's start with technology. BT works so well in a display environment, due to its ability to utilize browser cookie data. Cookies enable publishers and ad networks to anonymously track user behavior and serve highly relevant ads based on the data stored. Cookie data may be utilized to deliver video as it does now for display, but not in every player format (formats being Flash, Windows Media and Real Player to name a few). A quick survey of top publishers reveals that each uses a different player solution. And there lies issue number one: no standardization of formats.

Now, compound technology limitations with issue number two: scale in content. A large percentage of online video content is user-generated, making it difficult for brand-conscious advertisers to fully embrace due to the lack of controls. That leaves us with professional content, which is either owned by a few large entities (namely the broadcast networks), or too niche or small to be a viable inventory source. This closely ties into the technology issue, because with such limited scale, developers don't have a compelling reason to bother designing a new player solution.

The final issue is creative. To maximize the power of BT, a variety of creative must be available to support the various audience segments. GM, for example, would need potentially dozens of creative to support targeting by model, where the user is in the buying cycle, location, etc. Thankfully, this is one issue that is actually being addressed, with companies developing creative tools for advertisers and their agencies exactly along those lines.

We know the issues, and thankfully, the answers on how to resolve them are self-evident: standardization of formats combined with a workable distribution model for quality inventory will quickly allow video to flourish. This will benefit all involved and allow not only for BT to scale, but also all types of targeting and ad unit formats. So, the only question remaining is: Will it really take one to three years?