New Google Video Ad Product Prompts Questions

When Google twitches, the ad industry leaps. So, since the firm announced its new AdSense video ad offering Monday, it’s gotten people talking and contemplating its potential effect on the interactive ad world. Most seem to agree on one thing: Attaching the Google name to video advertising will warm advertisers to the notion of incorporating Web video into their campaigns.

“They’re really a bellwether for the online advertising space,” commented Joe Schab, president and CEO of Creative Digital Group, an agency that focuses on Web video campaigns. Having the Google name attached to video advertising is a “legitimizer,” so he thinks his clients will express more interest in video.

Ian Schafer, CEO of entertainment marketing agency Deep Focus, is definitely planning on trying out the video placements, but whether they’ll become a major component of his clients’ campaigns is another story. “It’s low hanging fruit for us. I’m confident that if we were to run ads like that they would perform fairly well.”

Still, Schafer isn’t so sure those outside the emotional realms of entertainment and lifestyle advertising will have success with the format. “People want to interact” with movie or auto ads, but does the same go for CPG advertisers pushing laundry detergent or lipstick? He’s not so sure.

The Google spots may not perform as well as the other far more robust interactive video units his agency often runs for clients like HBO and Miramax. “Simply running a video ad doesn’t really do enough for us, and you could call us spoiled because there was a time when we would have loved that.”

Until now, Google’s keyword-driven and contextual ads have been considered direct response vehicles. Video, however, has been seen primarily as a branding experience. In their initial reactions, some blog pundits and industry insiders have referred to the new offering as Google’s move into brand advertising. It remains to be seen whether the ads will work best for branding, direct response, or some combination of the two.

In recent years, local advertiser dollars have been moving online, particularly in the form of search ad revenue. Google itself, as well as others, have presented AdSense video as an affordable way for local advertisers to get in on the video game. Indeed, the ads can be geo-targeted internationally, nationally, or locally.

“It fits perfectly with our model,” explained Brad Inman, founder and chairman of neighborhood-centric short film site His newly-launched firm produces and distributes Web videos for local advertisers like restaurants and hair salons. “We’re not really into text,” he added. “We’re kind of betting the world is going in a different direction.” TurnHere’s advertiser clients could use the rights-free footage the company produces for video ads targeted by location-based keywords.

Although some have affirmed Google’s suggestion that deep-pocketed brand advertisers could use the format to test television ad creative, others aren’t sure the spots would be worth the investment for smaller advertisers. “I might use them,” noted Kari Chisholm, president of Mandate Media, an Internet strategy outfit serving nonprofits and political campaigns. “But with most Google ad locations still doing text-only, you’d have to have a pretty far-reaching buy to justify the production expense.” The video ads will only run on affiliate sites that accept Google’s image ads.

“We will likely run a few small tests next week to measure performance, as well as see if their reporting is as robust as competitors Klipmart and PointRoll,” said Michael Bassik, VP Internet advertising at political consulting firm MSHC Partners. If Google offers support like reporting and video encoding on the same level, “I think they’ll be very successful,” he added. He also suggested that Google’s bidding model could actually end up costing more per action than buying other Web video ad formats on CPM.

Like others interviewed for this story, Steve Garfield recognizes that a major component to the success of Web video is its viral nature. The popular video blogger runs AdSense text ads on his blog and wants to add the new video option. Because AdSense videos will be targeted based on keywords on a particular page at a given time, he wonders if there will be a way for users to link to an ad. Surely copyright issues are a factor here for Google and its advertisers.

One Web video industry insider questioned the new offering altogether. Google doesn’t have the backend technology to enable a full-fledged video ad network if advertisers really start showing interest, he opined. He and others in the video industry aren’t too impressed with Google’s Video content offering, which contributes to his skepticism. Because of its dominant position and extensive resources, he contended, Google can “dip their toes” into anything that seems like it could be a viable venture.

Join ClickZ’s Online Video Advertising Forum in New York City, June 16, 2006.

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