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The web’s success as a direct response medium has made its failure to attract brand advertising even more apparent. However, as the main hurdles are overcome all of that could change for Web 2.0 enabled sites in 2007.
The first barrier is that display advertising is not sold in fixed slot lengths. There is nothing more likely to get advertisers spending than making it as easy as republishing their TV ads (or variations of them) on the internet.
However because media owners do not sell fixed length slots, this is not really possible at present. Traditional web sites are organised into distinct pages which get completely refreshed on every click. With the average page views lasting under 30 seconds, it makes selling fixed length slots pretty much impossible.
However, Web 2.0 allows for a more continuous experience and thus will allow for fixed length slots to be sold. And those media owners that redesign their sites to enable fixed length video ads can expect to be well rewarded.
But there are two other barriers to overcome, those of file size and audience research.
The news on file sizes is not good. I was surprised to hear the IAB has just announced that ad file sizes have only been increased to 30k, “with a view to going to 100k”. Either of these figures are woefully inadequate for video and are ridiculous when viewed in a historical context.
File sizes were set at 15k ten years ago when the fastest connection speed was 28k. The majority of connections are now somewhere between 30 and 200 times faster, yet file sizes have only doubled. The good news is that with more than half the population on broadband there is no reason why small video ads cannot be used.
The final barrier is accountability, as brand marketers need to know who they are talking to. Audience research will be the key to overcoming this hurdle and in the absence of an industry initiative, perhaps our best hope is that the behavioural targeting companies will provide some distinct lifestyle segments for advertisers to work with.
With reports of falling rates and rising unsold inventory, video advertising could provide just the boost online advertising needs. It could break the current cycle that seems to exist where publishers are trying to increase revenues by adding more banners to pages.
This has just driven down response rates and hence CPMs have followed as a result. Video or no video, less ads per page has to be the way forward.
One thing that is for certain is that online video advertising is going to happen sooner rather than later. But if they can’t agree on whether ad file sizes should be 30k or 100k, one wonders whether the established online publishers will be ready.