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Online video finding it hard to get advertisers

Posted by todd at 5:26 AM on March 18, 2008

AP reports about the slow uptake of sponsors to video sharing sites like You-Tube. According to the managers (from the video sharing sites) that are quoted in the article the issue is the comfort level of the marketers. In my opinion the marketers are right to be hesitant.

A companies brand image is an important asset, and the marketing manager is responsible for taking actions that enhance that image. I can see too alternatives for someone that wants to advertise on YouTube. The first is to make a consolidated ad buy with some sort of criteria for the content you want to target. This would be an efficient way to manage your spend but reduces the control the company has over how its message is seen. A misleading tag (whether placed in error or not) could see your ad placed on a video that doesn’t suit you. We have all seen screen shots of banner ads next to a story criticizing the company in the ad.

The other alternative is to place ads in specific videos. This increases the amount of effort required and places pressure on the marketing manager to pick which video is going to be on message, and popular. Even then, if this is the tactic it would be cheaper to make the deal directly with the maker of the video rather than the video sharing site.

There are some smart people at these companies so maybe they can come up with a way to get quality advertising spend that I cannot see. My prediction though, is that ads for user generated video content will end up being dominated by the lower echelons of the advertising space, the untrustworthy and the borderline. The safer alternative for the name brands is to make deals directly with the producers of quality, regular content.