A New Look at Online Video Advertising

Online marketers know full well that video is a hot commodity these days, fueled by higher data speeds as well as increasingly more powerful and higher resolution smartphones and tablets. Now online video is so hot that it has become part of the “spring upfronts,” an annual ritual during which the advertising agency is traditionally feted by television networks.

The big difference this year is the emergence of the “Digital Content NewFronts,” online video networks and producers who are scheduling their own events to coincide with television’s upfronts. “The goal of the NewFronts, or new upfronts, is to encourage marketers and agencies to spend more money on digital ads, either by increasing budgets or shifting to online media some of the estimated $70 billion a year that is spent on television commercials,” according to The New York Times.

NewFronts are Not Just New Media

Actually, a review of “NewFront” participants reveals that it is not exclusively online companies. Organizations like AOL, Google (owner of YouTube), Hulu, Microsoft and Yahoo! will be there, but so will companies like NBCUniversal. Why? Because there is an ever-growing compatibility between traditional television and online video as media companies recognize that consumers watch both – often times sitting in front of a TV with a smartphone in hand. As The Times article points out, “There have been numerous announcements of new original programming, emulating the series format of TV; branded entertainment in which products are woven into plot lines; and alliances with famous names.”

Both on the programming and advertising side, the past few years have seen much more experimentation with online videos as a stand-alone medium, and it isn’t just by the companies you might expect.

Denny’s Opens Up to Millennials

For example, the relatively staid, conservative Denny’s, a restaurant chain that position’s itself as “America’s diner,” has produced “Always Open,” a video series running exclusively on College Humor, a website known for its edgy content. Hosted by comedian Dave Koechner, these unscripted videos feature impromptu interviews with young celebrities like Jason Bateman and Jessica Biel in an attempt to break through to the millennial crowd. The series isn’t advertising at all – it’s branded content, with nothing more than a subtle pitch for Denny’s at the start and end of each video. The series, which launched about a year ago and is in its “second season,” has already garnered over six million views.

Why would Denny’s invest in such a venture? Denny’s, largely known as a destination for families and older consumers, is clearly trying to appeal to a younger crowd and knows videos are the way to do it. Denny’s Chief Marketing Officer Frances Allen told The New York Times that the series was designed to be “an engaging brand moment for millennials” and to communicate “our brand message that diners are really welcoming places where everyone can come as they are.”

YouTube Stands to Gain

YouTube, and its parent Google, could be big winners in the growing interest in videos by major advertisers. Last year I wrote about YouTube’s initiatives to attract big brands, which seem to be paying off. Recent data from comScore shows that Google sites, including YouTube, bested all other websites in the highest number of unique viewers in March 2012, 146.1 million, an increase of almost 3 million from a year ago. While Yahoo! showed an increase as well, AOL, Facebook, and Microsoft sites showed declines from March 2011 to March 2012.

Jamie Byrne, YouTube’s global head of content strategy, said at a panel discussion during this year’s upfronts that the network’s strategy included creating “networks of channels or brands that act like programmers” so users can navigate their way through the burgeoning amounts of content on YouTube.

Ad agencies and their clients seem to be more than willing to listen to the pitches about new media. Digitas, an agency that skews toward digital media, has been at the forefront of NewFront; in fact, the agency has sponsored digital media events at the spring upfronts since 2008. The agency’s NewFront presentation this year drew a crowd of more than 600 attendees, according to The New York Times.

Online video ads may not replace traditional television ads anytime soon, but the ad industry is closely watching their upward momentum.

About Barry Silverstein

Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the world’s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.

2 Responses to A New Look at Online Video Advertising

  1. Businesses of any size can benefit from producing video content, not just the big brands.  The popularity of YouTube proves that people like to watch videos.  It’s the second biggest search engine.  Even with a low budget, it’s possible to create a video that can help your target audience or spark their interest in some way.  

  2. Barry Silverstein says:

    Thanks for the comment, Nick. Good point! YouTube, after all, started as a video playground primarily for amateurs and now it has been “discovered” by the big brands. Video is a great way to level the playing field for smaller businesses and make them look legitimate and get their message across in an engaging, interactive way — with the added benefit of driving more  search traffic.