Online video courts TV dollars

1. Summary

Digital advertising has proved itself for direct-response marketers, but branding dollars have remained elusive. Television dominates the budgets of brand marketers, looking to tell a story that connects with customers emotionally. Broadcast and cable networks still have the largest audiences and choicest, most brand-friendly video inventory available.

But now there is more premium video content and ad inventory available online, and brand marketers are starting to experiment with digital techniques to capture the efficiencies and targeting ability offered by programmatic buying, particularly as audiences fragment across screens. Relatively new online video networks as well as big online players like AOL and Google are gearing up to serve that growing demand. And the TV gang isn’t standing pat.

Key trends include the following:

• AOL’s acquisition of Adap.tv and Google’s mDialog aim to provide curated exchanges that will make brand marketers more comfortable with quality content while enabling programmatic buying. Brightroll wants to let online publishers build their own.
• Already, there are hints of a shakeout. Ad networks and exchanges like YuMe and Tremor Video are increasing investments in the face of earnings pressure. Comcast bought digital agency FreeWheel.
• Most brand buyers aren’t used to evaluating ROI or measuring lift in this space, let alone buying internet-style. Delivering evidence of payoff, and translating direct-marketing terminology into brand-speak is critical. If digital players can do this before the traditional TV industry can, TV stalwarts who have been living off inefficient spending and waste will face the same dilemma as print media.