4 Steps to Proving Online Video Can Sell

Read this post completely, because there’s going to be a test. And your future depends on it if you’re an online-video advertiser, creator or even watcher (who would rather endure ads than not pay for content, and yes I meant to say it that way).

Although I was recently a Product Director, most of my career has been focused at digital marketing. So when I bought traditional media, I deferred significantly to our company’s media buyer specialist and our buying agency. I pretended to understand the cost for reach and frequency, but the reality is that my eyes glazed over at promises of awareness levels and GRPs. They were meaningless excel sheets with large numbers that meant little to me. I just didn’t care. All I wanted to do was ensure that a dollar spent yielded a few dollars back in profit.

So when I read Jim Louderback’s article about web video advertising and CPMs of $100 and content creators paying 25 cents per view, I developed instant symptoms of pre-menopause.

We lamented at the current state of online video buying like the only two people at a Grateful Dead show that weren’t spinning in circles and seeing Abraham Lincoln in trees.

Louderback, CEO of Revision3, told me about his thoughts on Microsoft Vista’s obsession with reach and frequency, and how little it did to move product. Put less kindly, he says Microsoft murdered Vista buy buying broadly instead of targeted (I’d argue the engineers deserve some credit for that debacle).

At the risk of offending a media buyer, let me speak as a marketer… whose money you are trusted to spend wisely. You dazzle and confuse me. You tell me I’m getting great reach and recall but I don’t care. I think you’re really attractive, but I know you’re excited about a property because the rep took you to lunch last week. I just want to know that my revenue increases in excess of my spend (hopefully 3-5 times as much). So when you’re making a buy on the brand’s behalf, please consider impact more than reach. Reach and even targeting can’t move product without impact.


In the case of online video, why would anyone sponsor a show for a dime unless it had a good reason it could sell at least 30-50 cents of product? Why would someone pay for a view unless that view could sell a product? There are countless studies that show that banners are not seen, so I’d need to be proven otherwise before even a stupid 50-cent CPM buy made sense. The InVideo ads have been proven to work (Dynamic Logic) better than preroll or banners (download IAB report), but that depends on the creative and how immune we get to them (do you honestly think this click-thru data from last year is true today?). Most importantly, it depends on when the ad is served since most never finish a video (TubeMogul), and our eyes hover around the close button like Doctor Evil on the laser button.

But if the video content itself includes the brand — like Coke does with American Idol — it’s quite hard to miss. There’s also an implied endorsement because Simon, Paula and Randy are drinking Coke rather than Coke boasting about itself. That’s where the brands need to be unless our ads are as delightful as a Pixar film and we have audiences glued to seats.

Okay- I’m getting off my soap box now, and leaving you with Uncle Nalts’ 4 steps (and they’re using alliteration so even the thickest media buyer will remember it) . These are the tasks of everyone vested in the success of online-video, which will be driven in the foreseeable future by advertising not consumer micro-payments. Who has had success? Who’s ready to share? Who is ready to get answers? Believe me, this is a “rising tide floats all boat” initiative. We can do our quiet case studies that says we’re better than the next guy, or we can demonstrate collectively to brands and media buyers that this medium is the most accountable one since paid search. This is perhaps more vital than the radical shift of consumers from broadcast “lean back” to online-video “lean forward.”

Seriously- it won’t matter if online-video represents 4, 10 or 20% of video consumption in 2010 if we can’t prove it can compel a purchase! eMarketer will have to change its estimates on ad spending if we cooperate.

1) Educate: A CPM is NOT a CPM. Comparing apples to apple-flavored Halloween candy from 2004. I’m writing a piece for iMediaConnections about this. Simply put, a letter from a friend is going to have more impact than junk mail… even if they both arrive via the mailbox. Video ads and host-sponsored content are both delivered via video, but that’s where the differences end.

2) Relate: Use offline analogies. I love the Vista example. I’m not suggesting Coke bag advertising, but I have to believe there’s more value in the Coke green room than the DVR-blocked ad.

3) Substantiate: Someone has to survey video watchers, to understand — at the moment from their perspective — what ads impact them most: an ignored banner or a trusted star/show with a good placement. If you’ve done it, I doubt the media buyers know.

4) Calculate: the Holy Grail is to show via test/control or pre/post (Dynamic Logic, Comscore, Insight) that contextual and relevant video messaging is worth exponentially more than wrap-around banners or existing IAB standards (see IAB report for best practices) . It’s intuitive, but data will make a media-buyer’s life easier… so they know that an impression isn’t an impression unless it makes an impression (I just coined that, so don’t forget to copyright me). Now you can get back to lunch with the media properties. 😉

13 Replies to “4 Steps to Proving Online Video Can Sell”

  1. Wow! That was very well developed and thought out. I think if online videos and ads that help “feed” the people that produce want to be successful I think they do need to find the best way to get their ads out there so the viewers will actually pay attention to them.

    This was a great article. Now, to get all the advertisers to see this…haha

  2. Good post, Naltso. I worked on the creative side of advertising, and it seems like everyone in creative always made these arguments and no one listened.

    I think it’s part of the reason new media took off so big. Google ads are contextual and unobtrusive. It flat out works better. It’s the Coke in Simon’s hand rather than the blatant flashing “COKE IS GOOD” sign.

    Not annoying people does more than you think.

  3. @4 Thanks for acknowledging that, Bobby. And more importantly, @1 Nutcheese… thanks for that. I can’t poop while someone is showering. Or brushing their teeth.

  4. @5 & @1: I learned to poop during pretty much anything when my kids were little. They wouldn’t leave me alone, even in the bathroom. If you don’t poop in front of them, you never will.

  5. First just a note on MSVista, they had to Pay ME to take it

    top ad banners – only get you to click if they are intrusive, and that’s usually by mistake and frustrates the viewer

    As for ERSC… oh, heck, why are you still ragging on about this Kevin these guys are never going to figure out how much Alpo Ed McMahon really sold.

    btw have you seen these custom page targeted rolling googleadsenselike banners – a happy medium?

  6. @8 screw mcmahon. He was an idiot dying right before Fawcet and Jackson. Man- talk about getting overshadowed in life and death. @7 that’s true. It’s when they climb on me when I poop that I really clam up.

  7. How come no one still talks about that David Carradine death?

    As to Ed McMahon… I don’t think most people cared one way or the other.

    Farrah and Michael on the same day, now there’s a busy news day.

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