October 2009 – Channel Crossing: Online

The Internet Finally Comes of Age–For DR

By Michael Pierce

DR short-form advertising strategies are changing dramatically with the emergence of the Internet as a viable marketing channel. With sales of more than $200 billion in the United States and an expected growth rate of 10 percent over the next two years, the Internet is serious business. In the last five years, Internet video has been replacing online ad strategies such as PPC and traditional SEO as a vehicle to grab a slice of this growing pie. Add in the fact that the Internet is now the gateway to mobile marketing and it is easy to understand why serious conversations about how to integrate online video into DR campaigns is now taking place. The main issue today for campaign managers isn’t whether to use Internet video, but how.

As a director of DR commercials, I must admit I still get excited each time I see my work on TV. Sadly, though, TV isn’t what it used to be. With the advent of DVRs, on-demand programming and the 20-percent increase in the number of people watching programming online this year alone, TV continues to become a weaker and more fragmented medium.

It’s no wonder, really, since the Internet allows the best of both worlds for the viewer and advertiser alike. Viewers choose only what they want to see, when they want to see it, while advertisers have the luxury of marketing to a more specific audience. Whereas TV is a “lean-back” environment, the Internet is a “lean-forward” experience filled with people eager to be served offers, entertainment and information.

About a year ago, I was taught the gospel of Internet video advertising and marketing by Erik Craighead, founder of Video Army, LLC, and longtime Internet guru. Over the course of a few weeks, Erik enlightened me as to what was happening online. We ran scenarios, tested videos, looked at case studies and evaluated current campaigns. I was so enthused that I proposed that my company (Mutiny Pictures) and his become partners to bring true Internet marketing and advertising to the DR world. Erik agreed and VAMP (Video Army Mutiny Pictures) was born.

Since that time, we have launched campaigns for well-known and lesser-known companies alike. Some campaigns have focused on a national audience while others have focused on a region-by-region basis to better serve a franchisee philosophy. In either case, it is always thrilling to see our clients dominate Google’s organic search results, infiltrate a competitor’s search space online and outperform TV sales. Today, we offer a well-rounded system that gives DR campaigns the ability to do targeted video advertising, distribute their commercials virally and within social media communities, and to use video with keyword strategies so our clients quickly enjoy placement within the highly coveted organic search results.

Online Video Advertising in Practice
Targeted video advertising is one of the best ways for a DR brand to re-purpose their existing commercial online. One approach is a performance-based, roll-over video ad model. Roll-over video ads are a great way to showcase a product or service. First, a video ad is served to high-quality websites within an ad network. This gives advertisers control over where their spot plays and assurance that it won’t be placed on a website they find objectionable. Secondly, as a performance-based system, clients only pay for each time their ad is actually viewed. There simply isn’t any charge for an impression. So if an advertiser has a target mark of 200,000 views of their commercial, they might receive 15 million impressions of their video ad for no additional charge.

Another impressive aspect is that the cost-per-view charge for a video ad (when a consumer actually views the spot) is usually less than most PPC strategies such as AdWords. When a video ad is served, it can be designed to cover the user’s current webpage, giving the advertiser a captive audience. A consumer then has the option to click through to the advertiser’s website at any point during the ad, taking them to a URL of the marketer’s choosing for no additional charge.

A host of metrics is provided daily, allowing performance to be refined. Better-performing websites can be used more and non-performers can be eliminated. And if the total views contracted aren’t delivered, the difference can be refunded to the advertiser.

Other online video advertising strategies include leveraging video to establish and grow a consumer base via social media, using video to help with product “tone control” and ad placement within online video networks such as Hulu.com, thus making DR available within primetime programs such as NBC’s “30 Rock” and many others.

Online Video Versus TV
The benefits of online video advertising become even more clear when compared with other traditional mediums, particularly TV. First of all, TV for DR is usually not primetime inventory. Many ads are exhibited in late night or overnight slots where ads frequently get preempted and the audience is not guaranteed. A brand pays for the estimated audience determined by a group like Nielsen, but there is no guarantee anyone is watching. With TV, even if the ad is served, it may never be seen by the consumer–and no one will ever know. The potential lead might get up for a snack, make a phone call, be asleep or simply fast-forward through the ad.

In short, with TV, you pay for the impressions with no guarantee of views. If a consumer does engage your ad via a call center, you then incur another level of billing that far exceeds online e-commerce charges. With that said, I firmly believe that our clients still need to be on television, but they need to integrate those campaigns with an online strategy. In a perfect world, a client utilizes television to build brand awareness and set the table for more efficient sales via the Internet. After all, the key to success in any form of advertising is frequency. But while we do indeed see a spike in sales activity when TV is combined with Internet strategies, excellent conversion rates can also be achieved without TV.

No campaign is the same, and I firmly believe that each client strategy should be treated more like haute couture, rather than with an “off-the-rack,” one-size fits all philosophy. Whether a brand is in its product launch or extending itself into yet-uncharted waters, considering a multitude of tactics is the best play. These are very exciting times for online video marketing and no industry is better-positioned than DR to leverage new concepts, ideas and strategies, harnessing them to reach new consumers.

Michael Pierce is the founder of Mutiny Pictures and a pioneer in online video advertising strategies. He can be reached at michael@mutinypictures.net.