Coming Soon: Contextual Video Advertising

Until now, if you wanted to serve ads into online video you had to squeeze your commercial onto the beginning or the end of the clip. And though consumers don’t appear to be as annoyed as many thought they’d be over this practice, it’s still problematic in terms of getting people to watch and interact with them.

But what if you could insert ads into videos based on the words spoken in those videos? Better yet, what if you could automatically insert contextual text ads that would provide links between the content in the clips and related products? In short, what if you could have AdSense functionality for video?

Now it appears you can. A startup called DAVE.TV, whose CEO Rex Wong was the guy who created the technology that became Google’s AdSense, has launched and will soon offer contextual-based advertising for video. Although there hasn’t been a demo yet, this technology reportedly will allow ad association with keywords in the video content. Brands like Coke and Mentos could have had “Visit our site!” text links in the gazillions of “Diet Coke and Mentos explosion” videos posted on YouTube. Record labels could target advertising in the zillions of tribute videos uploaded to video-sharing sites. Heck, companies could even insert ads that countered negative videos about their products!

It’s an idea whose time has come. It takes advantage of online video’s unique properties. Previously, companies like Lightningcast and VitalStream had done some interesting stuff with dynamic commercial serving within video streams. But enabling contextual advertising takes the medium to a whole new level.

No doubt video-sharing sites are under a lot of pressure to provide advertising. Though it’s been kept a closely guarded secret, YouTube has been working on an advertising solution for a while now. It’s got the sheer numbers that make it attractive to advertisers interested in reaching its young, hip, technologically-savvy demographic. YouTube is taking its time with it, for sure, but when video clips clearly marked as ads draw huge numbers of viewers, it makes sense that consumers are willing to put up with other forms of advertising.

Other major properties are starting to see gold in the mountains of video, both on- and offline. Yahoo recently started offering PVR software in an effort to tap into the HDTV market. Google’s obviously been working tirelessly to improve its video offering since its initial, not-so-hot launch. Just about every day a new video startup hits the scene, offering various new levels of functionality. It’s clearly a trend.

For advertisers, the question soon will be not if they can do the kind of advertising they want but whether they should — and how to best utilize the medium. DAVE.TV’s functionality is pretty cool, but it also seems as though it’d be fairly easy to spoof if video creators wanted to do some odd things with associating their video with certain keywords. Even if they didn’t want to pull any funny business with the system, the problem remains. The nature of homegrown video, itself video content, is pretty rough. There may not be very many advertisers who want their brands associated with some of the grosser or more sexually explicit (even, perhaps, copyright-violating) content out there.

But that’s a problem we’ll all have to face in the future. Online video’s growth is too strong to ignore and the technology to view it (and now advertise in it) is getting better all the time.

Join us for our Online Video Advertising Forum in New York City, June 16, 2006.

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