Catherine "Cat" Seda

Thursday, May 03, 2007

Online Video Advertising: $775 Million to $1.3 Billion

Can you believe that U.S. Internet video advertising will jump from $775 million this year to $1.3 billion in 2008? Wowzers. Check out more eMarketer video stats in my May "Buzz" article for Entrepreneur magazine:

Visual Appeal

Move over, TV. Online video advertising is here.

More and more, TV-style commercials are appearing on the web. And companies are investing a lot of money in them.

According to eMarketer, spending on internet video advertising in the U.S. will jump from $775 million this year to $1.3 billion in 2008. That's an expected increase of 68 percent.

In its November 2006 "Internet Video" report, eMarketer stated that small and midsize businesses could greatly benefit from this hot technology. Online video ads are cost-effective to create, and they can act as marketing materials or even educational tools. It's also easy to promote them through your existing online marketing campaigns, and you can give them more visibility through video search sites.

A video ad usually falls into one of the following formats: in-page, in-stream or transitional. An in-page ad, or in-banner ad, refers to videos shown in a box within web page content. An in-stream ad, also called a preroll ad, is shown before the video content. Think of the video as a movie; the in-stream ad is the movie preview. A transitional ad, or interstitial ad, is shown to users while they're moving from one web page to another.

Generally, a video ad is 30 seconds long. However, because eMarketer's report states that 46 percent of users are only willing to view an online video for 20 seconds or less, it's a good idea to present your message and call to action before the end of your video.

© Entrepreneur


  • Hi Cat,

    What's your opinion on video concerning the playback?
    I never played with it. Would it be better to start automatically or wait for user input?


    By Anonymous Knox, at 8:46 AM  

  • Hey Knox,

    Hmm...I don't have stats on that but I'm guessing auto-play would be more effective. Pre, mid or post-roll ads are going to be automatic anyway--they're integrated with the content.

    By Blogger Cat Seda, at 10:23 AM  

  • I'm thinking about the audio bits used today, and they will most likely become more video driven as well.

    I always think about the cube worker, the 8-5'er surfing around.

    If the audio pops on when they aren't expecting it, we lose a potential customer (they don't want the boss to know they're playing), but if it's an optional play, then we might not get the "word out".

    Noticed your video article while I was thinking about it, knew you would have ideas.

    Thanks for following up so quickly. (hmm, maybe time targeted script) i dunno.

    Ok, sorry if I deviated from the article:)

    By Anonymous knox, at 8:51 PM  

  • I guess it depends on where the audio/video launches. I was totally thinking about podcast ads when I responded--if someone chooses to download audio or video content and there's an ad included, that doesn't seem intrusive to me.

    But now that I'm thinking about it, I get ticked off when I'm on a news/magazine site and as soon as I hit the home page I'm smacked with an audio or video ad (pop-ups are the worst). Do "distraction ads" even get a decent ROI? Or, do advertisers think these are good for branding?

    (As soon as I approve a comment, I post mine. Otherwise, I could get distracted by my own To-Do list for weeks!)

    By Blogger Cat Seda, at 11:33 AM  

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