With more and more corporations advertising on the Internet, and growing numbers of users using filters to ignore pop-ups, or surfing past banners, online video advertising is becoming increasingly popular. Internet video advertising uses streaming video content, which is just like a short television commercial, to attract customers and sell products, and advertisers who can afford it love it because it is so adaptable.

Online video advertising pieces can incorporate everything an advertiser might want, including flash animation, static images, text columns and interactive games, and it isn’t even tied to a specific banner-shaped box.

Types of Video Ads

While online video advertising can take many forms, there are three general types. Here is a brief overview of each of them:

• In-Page Banner Ads are in-page advertisements that deliver high-quality video. Usually found at the top of web pages, and are the same shape as a traditional static-image or animated banner. They are available either with host-initiated or user-initiated start-up. (Host-initiated ads start instantly when a page is viewed, whereas user-initiated ads must be selected or invoked by the user.)

• Expandable Ads include higher-quality video streaming for advertising purposes, and are completely user-controlled, in that each viewer can open, close, or minimize such ads. Like in-page banners, their start up can be either host-initiated or user-initiated.

• Floating Ads can also be initiated by either the host or the user, and are excellent at promoting brand recognition, because they appear to float, sometimes even moving around, over the website being viewed.

Common Features of Video Ads

Layered over the three types of internet video advertising are common features which all three types of ads sometimes include.

• Flash Components consist of computer generated animation, some of which looks extremely realistic. It can be as simple as a floating “click for more” message, or as complicated as an entire site. Flash ads are used a lot in the entertainment industry, especially for movie sites.

• Progressive Downloading is an alternative to usual streaming video. Instead of the video playing as soon as a page is loaded, or as soon as a user clicks on a start button, the video is downloaded to the user’s hard drive and begins to play after a significant part of the download has already completed.

• Multi-Video and Road-Block ads combine more than one video into a single online video advertising campaign. The individual video content can be the same in each ad-block or different, and they can be next to each other, or at opposite parts of a web page.

• Placement is not so much a feature as an important component of any internet video advertising campaign. Basically, the options are pre-roll, where advertising content comes before any other content, mid-roll, where general content is interrupted by video streaming for advertising, or post-roll, where the advertising comes after the content. Generally, pre-roll placement is the most effective, and mid-roll is the least effective, because just as in any other medium, users best remember the first and last things they encounter.

In addition, video ads can be marketed via AOL Instant Messenger, and within email messages.

Cost and Effectiveness

Unlike older forms of internet advertising, online video advertising prices are not based on click-through rates. Instead, advertisers have two charges – one is for creative – the actual content of the ads, and the other is for bandwidth, which involves the amount of traffic used and generated by an advertising campaign. Generally, however, you can expect that video advertising is at least 5 – 6 times more expensive than traditional online advertising.

The effectiveness of online video advertising is also more difficult to track, however, consider that Apple’s iTunes sold a million videos in it’s first day of operation, and that a recent study showed that 39% of US households had some form of broadband connectivity, and that in March, 2006, 42% of them used streaming video, usually during primetime hours.

While other reports state that internet video advertising only accounts for a small percentage of all online advertising revenue, that percentage is continuing to increase, and companies like Continental Airlines, which already operate on the web, claim a view-through rate of as much as 67%.

Things to Keep in Mind

While online video advertising would seem to be the best option in online advertising, there are some factors it is important to keep in mind:

• Cost. For a small business, a well-produced video advertising campaign may be prohibitively expensive.

• Content. Many larger companies assume that the same content they use for television commercials will play well on the internet. Unfortunately, this is not always the case. Fortunately, it is possible to make internet video advertising campaigns that keep similar tones to their television counterparts, while still tailoring their content for an internet audience.

• Customer Interaction. While roughly two thirds of all customers use the internet, and while they watched an average of 85 minutes of streaming video last fall, video advertising is still not as interactive as a more traditional rich media campaign that includes a survey or game.

While internet video advertising has not yet become the default source of online revenue, trends indicate that if used wisely, and watched carefully, it can be lucrative. Zachary Rodgers of Yahoo Solutions even said, in an article written in January, 2005, that the market was “near the tipping point.” Because online video advertising is “sticky” – attracting viewers – it is likely to become even more effective as time goes on.