1. October 2009
Marketing to the Online
Video Audience
David Hallerman,
Senior Analyst
dhallerman@emarketer.com
Executive Summary: A significant barrier to online video advertising’s fullest potential is the audience’s attitude
toward such ads—most people do not trust them. Of 16 advertising tactics and media, online video ads ranked near
the bottom for trust in an April 2009 Nielsen Online survey, among both the total respondent group and even teens,
who are presumably more accustomed to online marketing.
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To surmount this hurdle, marketers will need to develop a mix of
Advertising Tactics/Media Trusted* by Internet Users
in North America, by Age, April 2009 (% of ad formats that suits the increasingly varied content consumed by
respondents) the audience. For example, most video streams watched are 5
<20 Total minutes or less.At the same time, more and more short content is
Recommendations from people I know 96% 92%
professionally created, making it safe for brand marketers.
Consumer opinions posted online 66% 72%
Therefore, a less intrusive mix of preroll and other ad delivery
formats, such as overlays, could help reduce audience resistance.
Editorial content such as a newspaper article 81% 70%
Brand Websites 82% 69% In addition, content providers are making more full TV shows
E-mails I signed up for 55% 67% and movies available online, slowly shifting audience viewing
Ads in newspapers 68% 66% time away from television to the computer screen. That trend
Brand sponsorships 77% 62% creates support for more-extensive video ads, such as longer
Ads in magazines 70% 62% preroll or midroll placements with creative that rivals TV
Ads on TV 75% 61% commercials for influencing the audience.
Ads on radio 73% 61%
Surveys over the past few years consistently show a significant
Ads before movies 75% 53%
portion of the online audience—around one-quarter—is ready
Billboards and outdoor advertising 65% 53%
to pay some subscription fee to avoid advertising. But for many
Ads served on search engine results 46% 37%
people this is not an issue of ad-only versus ad-free. Instead,
Online video ads 35% 33%
the audience is focused on less-intrusive advertising.
Online banner ads 26% 24%
Text ads on a mobile phone 26% 18% The time is ripe for a video destination that offers a deep catalog of
Note: *participants responded that they trusted each tactic "completely" professionally created content supported by a blend of advertising
or "somewhat" and subscription fees.The reduced advertising would likely be less
Source: Nielsen Online, "Nielsen Global Online Consumer Survey," July
2009 annoying and therefore more acceptable to audience members—
105666 www.eMarketer.com and could attract a significant viewer base,giving it substantial scale
for online video ad placements.This mixed business model is,of
course,common in cable TV,newspapers and most magazines.
Key Questions
■ Why do many people distrust online video advertising, and
how can advertisers overcome that?
■ What ad methods are needed with short video content?
■ Is the online video audience as large as it appears?
® Digital Intelligence Copyright ©2009 eMarketer, Inc. All rights reserved.

2. The eMarketer View
Many online audience members dislike or distrust However, expecting a lot of audience interaction with video ads is
online video advertising. And yet many of the same people misguided. Research shows fewer clicks with video ads than other
like and trust TV commercials. The disparate responses to the two online formats, which makes sense. When people’s mindset is
similar ad formats are probably due to audience expectations— mainly on watching video content, they are less likely to be drawn
since much of online video content is ad-free, those clips or away by some commercial message.
programs with advertising seem off-kilter or uninviting.
Marketers and media companies both question
That audience perspective will shift as marketers increasingly whether the online video audience will accept
implement two key concepts: subscription-based video content or look to
advertising alone. As the previous report in this series—
■ Making the length of video ads suitable to the length of content,
“Digital Video Advertising: Where’s the Money?”—concluded,
so that they are not too pushy
a hybrid of ad support and subscriber fees for video content could
■ Devoting resources to develop high-quality video creative that is support substantial growth for Internet video advertising.
well-targeted to the intended online audience
For example, three-quarters of respondents to an IBM survey said
Audiences prefer less-intrusive advertising. Marketer ads are OK while the other one-quarter indicated they would
response to that perspective will help shape trends in the online rather pay a fee to avoid advertising. However, for many people
video advertising market. For instance, less may be more. An MTV the free/fee question is a gray area, where they will accept some
Networks/InsightExpress study found their audience liked how ads and reduced fees in exchange for a diversity of content.
short preroll and overlay ad combinations appeared and then
This three-quarters/one-quarter split is much like earlier research
disappeared, making them lower-impact and less intrusive—but
on the free/fee question. The fact that a significant minority is
with higher awareness metrics, too.
willing to pay for their content hints at two business models
Most people would prefer no advertising, in any besides advertising-only:
medium. For online video advertising, this may mean a shift from
■ Fee-only, as with Netflix’s streaming video
the implicit agreement between advertisers and audience—the
unsaid “we show you ads so you get to watch this video”—to an ■ A blend of fee and advertising, where ads reduce the fees and
explicit one based on greater transparency. That could involve the mixed revenues can support a wide range of video content
making the trade-off between ad-sponsored video (perhaps for
Video destinations that offer extensive content in exchange for
valued content not available on TV) and audience time an obvious
fewer ads and lower fees would likely attract a large audience.
transaction. In this way, ad-supported video could be seen as a form
That, in turn, would create a robust platform for video ads in an
of e-commerce, where people purposely purchase online access to
uncluttered environment.
video with their attention to the advertising instead of money.
Of the three key ways to evaluate video sites—
While social media and video are a natural
number of visitors, number of streams and streams
combination, marketers may find it difficult to include
viewed per visitor—the last one indicates the most
video advertising in social media settings. First off, much of
about potential engagement. And when you layer the
the video viewed on social media sites is user-generated, and not
time people spend with video upon the type of content (short or
attractive for many advertisers.And for those companies that look to
long, professional or user-generated), a far clearer picture
jump-start a viral video campaign through social networking, reality
emerges of where to place ad dollars.
sets in when they realize that relatively few social media users forward
commercial video links. However, since successful viral marketing Furthermore, the same data indicates that the online video
needs only a small number of carriers to spread the message, that audience is becoming more engaged. While the number of visitors
might be less of a problem than it initially appears. Furthermore, many has grown by only single-digit percentages between February and
viral videos can be low-cost, which allows marketers to test different July 2009, the average number of videos viewed by each audience
approaches without much drag on the bottom line. member has jumped by anywhere from 18% to 50% (depending
on the source) during the same period.
Most research indicates that video ads tend to be
more effective at moving the brand needle than, That growth indicates that brand marketers that are not at least
say, static banner ads. And because this is the Internet, testing some video advertising at this point will soon be behind the
some marketers or advertising technology firms expect all curve, trailing their competition.
advertising to be interactive, including video.
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Marketing to the Online Video Audience 2

3. The eMarketer View Audience Attitudes About
Advertising
The numbers game falls apart for online video,
though, when compared with video viewed on The dance between advertisers and audiences too
television. When you contrast the total time US consumers spend
watching TV with the total time they spend viewing online video, the often becomes a push/pull struggle, where
Web delivery channel looks like a mere rounding error at 1% of all advertisers look to push their messages and
video time in Q2 2009, according to data from Nielsen Online.
audiences look to pull away. That dynamic is
However, the share of total online video time nearly doubled particularly stark for online video advertising. The
compared with last year. So if it were to continue to double, then
the audience would be spending 16% of their total video time in cost of such advertising is high and the opportunity
front of computers by 2013. Of course, such clear-cut methods for for branding is strong, so marketers strive to get
estimating future trends seldom work out. Further, the breakdown
the most from it. However, the potential
among the three video screens—adding mobile to the mix—will
likely accelerate over time, with increasing hours of Internet- intrusiveness of video advertising makes many
streamed video viewed on TVs. At that point, the question of consumers shy away or consider it unacceptable.
whether video ads will reach an online audience or a TV audience
will likely become irrelevant. People tend to have less tolerance for online video ads than
seemingly equivalent television commercials. While only 7% of
online video viewers in an April 2009 survey from Frank N. Magid
Associates and Metacafe said video ads on the Internet were
more acceptable than TV commercials, nearly three times as
many found online less acceptable than TV.
But perhaps the most revealing response: 28% of viewers were
undecided regarding video ads. That group signifies the
undeveloped state of online video advertising, with its potential to
reach target audiences through brand messages.
Attitudes of US Online Video Viewers Toward Online
Video Ads, April 2009 (% of respondents)
Ads in online videos are more acceptable
7%
Ads in online videos are about the same as ads in TV shows
45%
Ads in online videos are less acceptable
20%
Not sure
28%
Note: n=1,279 ages 12-64
Source: Frank N. Magid Associates, "Magid Media Futures 2009:
Opportunities in Online Video" sponsored by Metacafe, July 7, 2009
105281 www.eMarketer.com
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The large portion of “not sure” respondents also suggests that
some people are unclear about what is or is not a video ad. For
example, some consider a banner that runs next to a video player
to be a video ad, while eMarketer does not.
When video ads appear on network TV Websites, general attitudes
improve. According to a study from Knowledge Networks, 34% of
people who stream TV programs online find the ads relevant
(which helps make them acceptable), with nearly one-half of those
who download TV shows perceiving the ads as relevant.
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Marketing to the Online Video Audience 3

4. Audience Attitudes About Advertising
This result suggests that video ads attached to traditional content, Note: Dwell time is a newly developed metric that attempts to
such as TV programs, will evoke more positive audience attitudes measure time as an engagement factor. Eyeblaster defines it as
than other types of online video. “the average number of seconds consumers intentionally spend
engaging with an online ad. The metric sums the following user
Attitudes of US Online Video Viewers Toward actions: amount of time the mouse was over an ad, user-initiated
Network TV Online Video Advertising, 2008 (% of
respondents) video duration, user-initiated expansion duration, and any other
Streamers Down- Total
user-initiated custom interaction duration.”
(n=710) loaders (n=1,915)
(n=209)
Average Time Spent on Online Advertising Among
Ads on favorite TV programs are 34% 49% 34% Internet Users in the US and Canada, 2008
usually relevant to me
Dwell rate* Average
Inclined to buy from companies that 26% 42% 27% dwell time
advertise on my favorite TV programs (seconds)
Note: ages 13-54 With video 7.53% 85.16
Source: Knowledge Networks Inc. "How People Use TV's Web
No video 5.56% 32.73
Connections," March 18, 2009 as cited by Marketing Charts, March 26,
2009 General 6.54% 57.58
102722 www.eMarketer.com Note: excludes messenger ads; *cumulative instances of where a user
102722 interacted with the ad divided by served impressions
Source: Eyeblaster, "Trends of Time and Attention in Online Advertising,"
A drill-down look at audience attitudes from Nielsen Online shows provided to eMarketer, July 22, 2009
that audiences ages 30 and younger are more likely than older 106682 www.eMarketer.com
viewers to find online video advertising funny, emotionally touching 106682
and informative—qualities essential for brand marketing. For additional information on the above chart, see
Younger people tend to be more comfortable than their older Endnote 106682 in the Endnotes section.
counterparts with online media, such as video. That comfort can
lead to a higher level of engagement, such as the 55% of those 30 Online video ads work in large part because they are, in fact, quite
or younger who find video ads funny. Further, some of video ads comparable to TV commercials.
are geared more toward a younger demographic, are more edgy in
Similar to TV, simply noticing the advertised product/brand was
cases, and are therefore perceived as funnier.
the top response among active online video viewers in an August
Level of Engagement with Online Video Advertising 2008 Veoh Networks survey conducted by Forrester Consulting.
by Internet Users in North America, by Age, April 2009
(% of respondents)
Funny Emotionally touching Informative
<20 66% 41% 52%
<30 55% 30% 44%
30-34 40% 18% 30%
35+ 42% 26% 31%
Total 47% 27% 34%
Note: respondents who "strongly agree" and "agree" that online video ads
engaged them on each of these aspects
Source: Nielsen Online, "Nielsen Global Online Consumer Survey," July
2009
106683 www.eMarketer.com
106683
Attitudinal surveys only go so far, though, because sometimes
people remember incorrectly, wish to please the pollster or look to
give the “right” answer. Data-based research might be more on
target. And time spent might be a more accurate measure of
engagement than ideas such as touching, funny or informative.
In that light, research from Eyeblaster shows that Internet users in
the US and Canada in 2008 spent 260% more “dwell time”
engaging with an online video ad (85.16 seconds) than a plain
banner (32.73 seconds). Video ads work better than banner
advertising in that respect.
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Marketing to the Online Video Audience 4

5. Audience Attitudes About Advertising
Clicking on a video ad, in contrast, was relatively rare, done by 12% A different survey, conducted in August 2008 by iPerceptions, also
or less of each group—even the super-active “connectors.” While found that video advertising rarely created interactivity, with only
that group (which is typically younger than the other two segments) 11% of respondents saying they were likely to click.
represented just 7% of online viewers, it consumed 20% of all online
video and was responsible for 42% of all online video-sharing. Likelihood of US Internet Users to Click on Online
Ads, by Format, August 2008 (% of respondents)
Ad Responses of US Active* Online Video Viewers
Text link 25%
During Their Most Recent Online Video Site Visit, by
Segment, August 2008 (% of respondents) Right banner 20%
Noticed the product or brand that was advertised during my Top banner 12%
video viewing experience
Video ads 11%
48%
34% Interactive ads 7%
34%
Interstitial 4%
Clicked on an ad and registered for a sweepstakes or giveaway
Source: iPerceptions Inc. survey provided to eMarketer, October 6, 2008
12%
098895 www.eMarketer.com
3% 098895
4%
Similar to the Nielsen Online data, younger video viewers in the
Clicked on an ad that was part of or next to a video I was iPerceptions survey were more likely to click on video ads than
watching and learned more about the product or service
9%
older ones. That might point to longer-term trends, where video
3% ads will offer a greater degree of interactivity to an increasingly
5% available audience.
Clicked on an ad and signed up for more information
Demographic Profile of US Internet Users Who Are
6%
Likely to Click on Online Ads, by Format, August 2008
3% (% of respondents)
2%
Text Right Top Video
Purchased a product links banner banner ads
4% Age
2% <25 14% 14% 23% 31%
2% 25-34 19% 19% 22% 21%
Connectors Controllers Watchers 35-44 19% 22% 22% 14%
45-54 22% 22% 18% 16%
Note: n=415 (watchers); n=397 (controllers); n=193 (connectors); ages 13+;
*those who watch more than 1 hour of online video per week 55-64 18% 16% 10% 13%
Source: Veoh Networks, "Watching the Web: How Online Video Engages
65+ 7% 6% 4% 5%
Audiences" conducted by Forrester Consulting, October 8, 2008
098734 www.eMarketer.com Income
098734 <$50,000 36% 33% 39% 49%
$51,000-$75,000 18% 20% 18% 18%
For additional information on the above chart, see
$76,000-$100,000 15% 16% 11% 11%
Endnote 098734 | 098735 in the Endnotes section. $101,000-$150,000 16% 15% 17% 10%
$151,000-$250,000 10% 11% 9% 7%
$250,000+ 5% 5% 6% 6%
Frequency*
First visit 17% 12% 14% 19%
Daily 29% 31% 36% 33%
Weekly 33% 34% 31% 31%
Monthly 15% 16% 14% 12%
Sporadic 7% 7% 5% 6%
Note: numbers may not add up to 100% due to rounding; *frequency of
visiting the site on which the ad appears
Source: iPerceptions Inc. survey provided to eMarketer, October 6, 2008
098896 www.eMarketer.com
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Marketing to the Online Video Audience 5

6. Audience Attitudes About Advertising
Richly populated video destinations supported by a blend of For example, while 86% of the respondents in an April 2009 Ipsos
advertising and subscriber fees could draw large audiences MediaCT survey said ad-supported full-length TV shows were very or
and therefore contribute to substantial growth for Internet somewhat reasonable, 50% said the same thing about ad-supported
video advertising. (For more information on video advertising amateur or homemade video clips.
revenue models, see eMarketer’s August 2009 report,
“Digital Video Advertising: Where’s the Money?”) US Online Video Viewers’ Acceptance of Free,
Advertising-Supported Online Video, by Type of
When the IBM Institute for Business Value asked US Internet users Content, April 2009 (% of respondents)
if they preferred fee or free for online video content, 74% said ads Very Somewhat Not very Not at all
reasonable reasonable reasonable reasonable
were OK and 26% would pay to avoid advertising.
Full-length 37% 49% 7% 7%
TV shows
This three-to-one split is consistent with prior research on the
Full-length 35% 43% 12% 10%
fee/free question. Those willing to pay subscription fees hint at movies
two business models besides advertising-only: fee-only, as with Movie/TV 26% 39% 17% 18%
Netflix’s streaming video; or a blend of fee and advertising, where trailers or
previews
the ads support lower costs and a broad range of video content. Amateur or 22% 28% 20% 31%
homemade
video clips
Internet Users in Select Countries Who Are Interested
in Online-Video-Ad-Supported Content vs. Paid Online Note: n=939 ages 12+
Content, Q3 2008 (% of respondents) Source: Ipsos MediaCT, "MOTION study," September 9, 2009
106714 www.eMarketer.com
Japan 106714
80% 20%
That relatively high figure for advertising on user-generated video
Australia clips is somewhat surprising, when common wisdom says
75% 25%
virtually all Internet users think user-generated media should be
US ad-free. Ipsos’ research might encourage some advertisers—that
74% 26% were previously skittish about putting their brand messages into
UK user-generated video clips—to do so.
73% 27%
Germany Video Ad Format Preferences
69% 31% The debate over how much Internet users will accept preroll video
India ads continues. Furthermore, some video advertising advocates
64% 36% decry the preroll format because it fails to take advantage of the
Would watch advertising before or after quality, free content Internet’s interactivity.
Would pay to avoid advertising
Note: n=2,800 ages 13+
Source: IBM Institute for Business Value, "Digital Consumer Survey Results
November 2008" provided to eMarketer, November 17, 2008
100325 www.eMarketer.com
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That blend—common to other media such as cable TV, most
magazines and newspapers—would require large-scale offerings
of online video content to attract a large audience.
The audience’s acceptance of video ads depends on the nature of
the content. This is not surprising.
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Marketing to the Online Video Audience 6

7. Audience Attitudes About Advertising
Nevertheless, audiences find preroll ads familiar, the closest online The audience preferences in the Veoh/Forrester study pointed to a
analogue to TV commercials.While most people prefer no advertising, basic fact of advertising:The less intrusive, the more people accept it.
in any medium, 29% of the IBM Institute’s respondents preferred Among those who watched full-length TV programs online, slightly
preroll and postroll ads over any other online video ad format. more preferred static banner ads (43%) than preroll video ads (37%).
Far fewer cited a preference for midroll or postroll placements.
Online Video Advertising Formats that Internet Users
Worldwide* Prefer to View, Q3 2008 (% of Ad Types Preferred by US Active* Online Video
respondents) Viewers Who Watch Full-Length TV Programs Online,
Video before/after content August 2008 (% of respondents)
29% Do not Watch Watched
watch full- full-length
Ads in frames surrounding content full- length in most
length recent
12%
session
Video during content Banner ads that are next to the video I 39% 43% 38%
8% am watching
Video ads that come on before the 36% 37% 39%
Sponsored with showcased products
video I watch
8%
Video ads that show in between videos 11% 19% 23%
Note: n=2,800 ages 13+; *Australia, Germany, India, Japan, the UK and the or segments of videos I watch
US Video ads that come on after the video 18% 14% 18%
Source: IBM Institute for Business Value, "Digital Consumer Survey Results I watch
November 2008" provided to eMarketer, November 17, 2008
100326 www.eMarketer.com
Ads that come up over the bottom of the 21% 21% 20%
video I am watching but don't interrupt
100326 the video
When Razorfish contrasted preroll with other types of online Ads that come up when I pause the video 11% 17% 19%
advertising, however, more active online consumers preferred I am watching
banners than streaming video ads. However, substantially more Note: n=1,013 ages 13+; *those who watch more than 1 hour of online
video per week
respondents preferred preroll to tickers, also called video overlay ads. Source: Veoh Networks, "Watching the Web: How Online Video Engages
Audiences" conducted by Forrester Consulting, October 8, 2008
098741 www.eMarketer.com
Online Advertising Formats Preferred by US
Connected Consumers, June 2008 (% of respondents) 098741
In addition, 37% of people who viewed network TV shows online in
Banner ads on same page 44.44%
2008 also watched preroll ads, according to Knowledge Networks.
Preroll 33.63% Of course, a higher share of online TV shows and clips contain
Interstitials 13.10% preroll than do run-of-the-mill online videos.
Tickers 8.83%
US Network TV Video Streamers Who Watch Preroll
Source: Razorfish, "Digital Consumer Behavior Study" as cited in "FEED: Ads, 2006 & 2008 (% of respondents)
The Razorfish Consumer Experience Report," October 2008
099240 www.eMarketer.com Watch video with preroll ads
099240 30%
37%
For additional information on the above chart, see
Watch video without preroll ad
Endnote 099240 in the Endnotes section.
15%
10%
2006 2008
Note: ages 13-54
Source: Knowledge Networks Inc. "How People Use TV's Web Connections"
as cited in press release, March 18, 2009
102725 www.eMarketer.com
102725
For more about ad formats, the video “Online Video
Primer: Video Ad Types” is available on eMarketer’s
Website. Download video
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Marketing to the Online Video Audience 7

8. Audience Attitudes About Advertising
Response to Ad Formats However, longer video ads offer more potential to engage the
While the preroll is ubiquitous, that may not make it the most audience.That can be seen among the 42.2% who said the 30-second
effective form of online video advertising. preroll was an ad they would stop and look at, 7 percentage points
higher than for the other two types of advertising.
A July 2009 study from MTV Networks and InsightExpress
examined how people react to preroll alone and to preroll blended The flip side appears in the 68.4% who agreed that 5-second
with two other ad formats: preroll plus lower 1/3 was short and let them get to their video
quickly. Note too that clicking or interacting with any of the three
■ What MTV calls a “lower 1/3,” which is a form of overlay
ad formats got the lowest positive responses.
■ The “sideloader,” which is a banner ad that slides out of the
right-hand side of the video screen approximately 10 seconds US Internet Users’ Attitudes Regarding Online Video
Advertising Campaigns on MTV Networks, by Type of
after video playback begins Ad, January-April 2009 (% of respondents*)
For unaided brand awareness, the addition of the lower-1/3 5-second 5-second 30-
preroll preroll second
overlay to a 5-second preroll, for example, performed better + + preroll
lower 1/3 sideloader
against the control group (who had not seen any of the video
More intrusive than other ad formats 24.7% 29.2% 30.0%
formats) than the 30-second preroll alone. The implication is that
Liked that it didn’t interrupt the video 64.5% 57.9% 61.8%
less-intrusive advertising can also be more effective.
An ad I would stop and look at 35.0% 35.2% 42.2%
Note, however, that all these ads were tested against short-form The way the ad was delivered was cool 44.1% 43.2% 45.7%
content, where a 30-second preroll might be disproportionate. An ad I would click on or interact with 23.4% 25.1% 25.1%
Most short-form content, even professionally made, tends to have Length of the ad was appropriate 61.0% 60.5% 63.1%
15-second prerolls at most. Ad was short and let me get to my 68.4% 64.2% 58.6%
video quickly
Brand Metrics for US Online Video Advertising An ad I’d like to see again 24.6% 26.5% 29.8%
Campaigns on MTV Networks, by Type of Ad, Note: n=403 (5-second preroll + lower 1/3); n=427 (5-second preroll +
January-April 2009 (% of respondents) sideloader); n=353 (30-second preroll); *respondents who answered
“agree” or “strongly agree” on 5-point scale
Control 5-second 5-second 30-second Source: MTV Networks, "Project Inform" conducted by InsightExpress, July
preroll preroll preroll 2009
+ +
106674 www.eMarketer.com
lower 1/3 sideloader
106674
Unaided awareness 12.6% 22.9% 17.6% 19.8%
Aided awareness 72.9% 81.0% 79.4% 81.7% For additional information on the above chart, see Endnote
Online ad awareness 29.2% 56.2% 56.1% 47.5% 106674 | 106676 | 106669 in the Endnotes section.
Purchase intent 41.4% 44.2% 36.3% 37.9%
Note: n=2,306 (control); n=403 (5-second preroll + lower 1/3); n=427
(5-second preroll + sideloader); n=353 (30-second preroll) When MTV/InsightExpress examined the elements of video ads to
Source: MTV Networks, "Project Inform" conducted by InsightExpress, July
2009; eMarketer calculations, September 2009 see what people liked best, they found relatively broad support for
106669 www.eMarketer.com several features. For example—and not surprising—
106669 approximately 39% of respondents favored animation or motion in
ads, regardless of how the ads were delivered.
For additional information on the above chart, see Endnote
106674 | 106676 | 106669 in the Endnotes section.
“30-second prerolls are a nightmare on Web
video. Nobody wants to see that.”
—Dina Kaplan, co-founder and chief operating officer, blip.tv,
in a video interview on The Business Insider,August 31, 2009
Certainly, more respondents to the MTV/InsightExpress survey
found 30-second preroll ads more intrusive than the short preroll
and overlay combination.
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Marketing to the Online Video Audience 8

9. Audience Attitudes About Advertising
However, remember that most people prefer less-intrusive ads. So When Nielsen Online asked Internet users worldwide which of 16
it is also no surprise that the highest response rate was for advertising tactics or media they trusted somewhat or completely,
appearing/disappearing 5-second preroll ads combined with lower online video ads ranked 14th, cited by only 37% of respondents. In
1/3 or sideloader, and lower for the longer 30-second preroll. contrast, 62% said they trusted TV commercials.
US Internet Users Who Liked Elements of Online Advertising Tactics/Media Trusted* by Internet Users
Video Advertising Campaigns on MTV Networks, by Worldwide, April 2009 (% of respondents)
Type of Ad, January-April 2009 (% of respondents*)
5-second 5-second 30- Recommendations from people known 90%
preroll preroll second
+ + preroll Consumer opinions posted online 70%
lower 1/3 sideloader
Brand Websites 70%
Animation or motion of the ad 38.8% 39.8% 40.4%
Editorial content (e.g., newspaper article) 69%
Movement of ad across the screen 32.4% 37.9% 30.9%
How the ad appears and then disappears 43.9% 47.9% 38.5% Brand sponsorships 64%
Ability to expand the ad 31.7% 33.9% 29.4% TV 62%
Ability to click a link in the ad 36.4% 38.8% 30.9% Newspapers 61%
Ability to see a longer video ad with a 34.2% 36.3% 29.5%
click Magazines 59%
Note: n=403 (5-second preroll + lower 1/3); n=427 (5-second preroll + Billboards/outdoor advertising 55%
sideloader); n=353 (30-second preroll); *respondents who answered
“agree” or “strongly agree” on 5-point scale Radio 55%
Source: MTV Networks, "Project Inform" conducted by InsightExpress, July
2009 E-mails signed up for 54%
106676 www.eMarketer.com Ads before movies 52%
106676
Search engine results ads 41%
For additional information on the above chart, see Endnote Online video ads 37%
106674 | 106676 | 106669 in the Endnotes section.
Online banner ads 33%
Text ads on mobile phones 24%
Dislike for Video Ads
Note: *participants responded that they trusted each tactic "completely"
The MTV/InsightExpress focus on drill-down details of what the or "somewhat"
audience likes is rarely seen research. But the audience’s general Source: Nielsen Online, "Nielsen Global Online Consumer Survey" as cited
in company blog, July 7, 2009
dislike of advertising, including video, comes through loud and clear. 105383 www.eMarketer.com
105383
Why the gap between the two similar advertising formats?
Expectations are likely a big part of it, since people are
accustomed to TV commercials but expect free online content.
That audience attitude might evolve over time, as marketers learn
how to better blend high-quality video ad creative into professional
video content, which is becoming increasingly available.
However, even though only about one-third of Internet users
trusted video ads to some degree, two-thirds (67%) of the
respondents agreed or strongly agreed with the statement that
advertising supports low-cost and free content on the Internet, TV
and other media.
®
Marketing to the Online Video Audience 9

10. Audience Attitudes About Advertising
That understanding of the implicit contract between advertisers The Veoh/Forrester study also illustrated the imbalance between
and audience offers hope to marketers that, with time creating audiences finding video ads annoying (which reduces trust) and
familiarity, people will come to trust online video ads more. the trade-off of ads for free content. Whether the respondents
Further, that understanding opens the door to more transparency, were categorized as active connectors or more passive watchers,
such as when marketers sponsor video content of substantial about 20% more called video ads annoying than those who
value. In that scenario, the audience is made aware of both the thought of them as fair to help pay for video services.
marketer’s message and the content’s worth.
Attitudes Toward In-Video Ads Among US Active*
Attitudes of Internet Users Worldwide Toward the Online Video Viewers, by Segment, August 2008 (% of
Value of Advertising, April 2009 (% of respondents) respondents)
Strongly Agree Dis- Strongly No In-video ads are annoying
agree agree dis- opinion
61%
agree
59%
Advertising and sponsorships 22% 59% 10% 3% 6%
are important to fund sporting 58%
events, art exhibitions and
cultural events In-video ads are fair as they help pay for online video services
By helping companies succeed, 41%
15% 65% 12% 2% 7%
advertising creates jobs in 37%
those companies and in the 34%
advertising industry
Advertising stimulates I avoid Websites that use in-video advertising
16% 52% 22% 5% 6%
competition which leads to 19%
better products and lower 21%
prices
23%
By providing me with 14% 53% 22% 6% 5%
information, advertising allows In-video ads are useful when they feature something I am
me to make better consumer interested in
choices
28%
Advertising funds low-cost and 14% 53% 18% 4% 11% 19%
free content on the Internet, TV,
newspapers and other media 19%
Advertising contributes to 13% 58% 17% 3% 8% In-video ads can be entertaining
growth of the economy 23%
Advertising often gets my 13% 53% 21% 7% 5% 17%
attention and is entertaining
10%
Advertising provides useful 13% 50% 23% 7% 7%
information on important Connectors Controllers Watchers
issues in society, such as
safety and health Note: n=415 (watchers); n=397 (controllers); n=193 (connectors); ages 13+;
*those who watch more than 1 hour of online video per week
Source: Nielsen Online, "Nielsen Global Online Consumer Survey," July Source: Veoh Networks, "Watching the Web: How Online Video Engages
2009 Audiences" conducted by Forrester Consulting, October 8, 2008
105659 www.eMarketer.com 098735 www.eMarketer.com
105659 098735
For additional information on the above chart, see
Endnote 098734 | 098735 in the Endnotes section.
®
Marketing to the Online Video Audience 10

11. Audience Attitudes About Advertising
Social Media and Video Advertising It is clear why social media users attract marketers interested in
The audience dislike of online video advertising encourages some online video. For one, 53% of social network users watched more
marketers to believe that social media will help them break down online video than TV in Q4 2008, according to LiveRail.
barriers.That perspective is reinforced by responses to a GfK Roper
survey, where only 29% of respondents cited marketing on social US Social Network Users Who Watch More Online
Video Than TV, Q4 2008 (% of respondents)
networking sites as annoying, compared with 50% who were annoyed
by ads during online or offline video-on-demand programming. Watched more online video than TV
53%
Types of Ads/Promotions that US Internet Users Find Watched about the same
Acceptable or Annoying, September-October 2008 (% 19%
of respondents)
Watched more TV than online video
Quite Find
acceptable annoying 28%
Free product sample distributed by people or 67% 12% Note: n=400+ ages 18-24
included in magazines/newspapers Source: LiveRail, "State of the Industry: LiveRail’s Q4 2008 review of online
Newspaper ads 56% 12% video advertising," January 19, 2009
101066 www.eMarketer.com
Magazine ads 50% 19%
101066
Radio ads 43% 29%
However, much of that watching was undoubtedly of user-generated
Ads on TV 42% 37%
Product placement in movies/TV programs/video 31% 36%
content (which most advertisers shun).That trend is seen in a
games March–April 2009 survey by the Pew Internet & American Life Project,
Unconventional marketing* 24% 37% which found that 62% of respondents viewed user-generated videos
Social networking sites or blogs 23% 29% on a sharing site.
Paid ads in search engine results 21% 48%
Product placement in virtual worlds 15% 24% Online Social Media Activities of US Internet Users,
Ads during video-on-demand programming 10% 50%
March-April 2009 (% of respondents)
Web ads that play before landing/obscure 8% 79% Watch user-generated video on a sharing site 62%
homepage
Pop-up or banner ads on Websites 6% 83% Use social networking sites 46%
Ads on mobile phones 5% 70% Use Twitter/share updates 11%
Unsolicited e-mail 4% 84%
Note: n=1,687 ages 18+
Note: n=2,000 ages 18+; *ads in unconventional places or the use of Source: Pew Internet & American Life Project, "The Audience for Online
individuals to spread the word about products/services Video-Sharing Sites Shoots Up," June 17, 2009
Source: GfK Roper, "Media, Advertising & Consumers," provided to 105811 www.eMarketer.com
eMarketer, November 20, 2008
105811
100164 www.eMarketer.com
100164
The thinking is that video’s prevalence on social network sites—
and the social elements of sharing, forwarding and commenting
on video sites—helps put the “media” in social media. And,
therefore, video and social media would naturally go together.
®
Marketing to the Online Video Audience 11

12. Audience Attitudes About Advertising
In response to the connection between social media and video, Note that a link to the survey was originally posted on Twitter and was
63% of brand marketers and 60% of agency executives in June and reposted by other marketers on Facebook and blogs.That
July 2009 told Equation Research that online videos were part of methodology naturally draws in those already involved in social media.
their social media efforts, right up there with Facebook and Twitter.
Social Media Used by US Marketers, January 2009 (%
Social Media Used for Marketing According to US of respondents)
Brand Marketers and Ad Agencies, June-July 2009 (% Twitter
of respondents)
86%
Brand Agency
Blogs
Facebook 80% 84%
79%
Twitter 69% 76%
Online videos 63% 60% LinkedIn
78%
Blogs 57% 72%
Podcasts 34% 28% Facebook
MySpace 34% 25% 77%
Webcasts 33% 31% YouTube or other video
User forums 33% 22% 41%
Widgets 30% 23% Social bookmarking sites (i.e., Delicious)
Wikis 24% 19% 38%
Other 21% 25%
Forums
Note: n=123 brand marketers; n=264 ad agencies
38%
Source: Equation Research, "2009 Marketing Industry Trends Report,"
August 18, 2009
StumbleUpon
106250 www.eMarketer.com
28%
106250
Digg, reddit, Mixx or similar site
A lesser, but still significant, percentage of marketers (41%) in a
26%
March 2009 Michael A. Stelzner survey said they made video—either
on YouTube or other sites—part of their social media outreach. FriendFeed
18%
Source: Michael A. Stelzner, "Social Media Marketing Industry Report,"
March 17, 2009
102683 www.eMarketer.com
102683
For some companies, the primary way to blend video advertising
and social media is through viral marketing.
®
Marketing to the Online Video Audience 12

13. Audience Attitudes About Advertising
At this stage of the game, viral video is a low-cost process. The January 2009 survey from Lightspeed Research found 39% of
According to a MarketingSherpa survey in October and November respondents shared a video clip—not just during their most recent
2008 of marketers who created one or more viral videos during the visit, as in the Veoh/Forrester poll, but ever. When you consider
prior year, the budgets for 62% of respondents ranged from only
that successful viral marketing needs only a small number of
$101 to $10,000. That low financial impact encourages companies
carriers to spread the message, that figure gives ammunition to
to try viral video marketing, since the cost of failure is so small.
those looking to combine video with social media.
Amount US Marketers* Spend on Viral Video,
October-November 2008 (% of respondents) Online Video and Social Networking Activities of US
Internet Users, January 2009 (% of respondents)
$0 11%
Watched a video clip 72%
$1-$100 15%
Read a blog 46%
$101-$500 16%
Managed a social network profile 41%
$501-$1,000 16%
Shared a video clip 39%
$1,000-$10,000 30%
Uploaded a video clip 32%
$10,001-$100,000 12%
Wrote a blog 18%
$100,000+ 1%
Note: ages 16-64
Note: n=1,083; numbers may not add up to 100% due to rounding; *who Source: "Global Web Index" conducted by Lightspeed Research, May 28,
created one or more viral videos in the past year 2009
Source: MarketingSherpa, "Video Marketing Survey," April 10, 2009 104104 www.eMarketer.com
103091 www.eMarketer.com 104104
103091
However, much of that video-sharing has little to do with
However, forwarding video links—the main element marketers
look for with viral video—may not be all that common. In the marketing, since forwarding links to commercial videos is less
Veoh/Forrester survey, only 21% of active video viewers said they common. In 2006, for example, 26% of those people who viewed
passed along a video or a link during their last visit to an online network TV sent a friend a video ad link. But by 2008, that figure
video site. In comparison, 37% performed no type of social activity. dropped to only 17%, according to Knowledge Networks. In this
case, it seems the more common video ads become online, the
Social Activities of US Active* Online Video Viewers less noteworthy as well.
During Their Most Recent Online Video Site Visit,
August 2008 (% of respondents)
US Network TV Video Streamers Who Have
Read comments from others Forwarded a Link to a Commercial or Advertiser
40% Video, 2006 & 2008 (% of respondents)
Looked at the ratings others had given the video 2006 26%
28%
2008 17%
Sent a video or link to a video to someone else
Note: ages 13-54
21% Source: Knowledge Networks Inc. "How People Use TV's Web Connections"
as cited in press release, March 18, 2009
Rated a video I was watching
102723 www.eMarketer.com
17%
102723
Posted a comment on a video that I watched The adage holds true: You cannot make an ad go viral. Social
11%
networks can help because of some of the built-in notification
Posted a video or link to a video on my blog or social networking options that are in place—if users view an ad or comment on it, a
page (e.g., Facebook, MySpace)
notification goes to their friends on their newsfeed. But if the
6%
audience doesn’t find the ad interesting enough to view in the first
Bookmarked to a social media or bookmarking site (e.g., Digg,
StumbleUpon, Delicious, reddit, etc.) place, it doesn’t matter.
5%
None of the above
37%
Note: n=1,013 ages 13+; *those who watch more than 1 hour of online
video per week
Source: Veoh Networks, "Watching the Web: How Online Video Engages
Audiences" conducted by Forrester Consulting, October 8, 2008
098731 www.eMarketer.com
098731
®
Marketing to the Online Video Audience 13

14. What People Watch (and Why)
To overcome audience resistance to online video “Our research shows the Internet is a
advertising, marketers must find an appropriate fundamentally different experience for
consumers than television. Online, they are
match between the ad and the associated content. watching shorter clips in general. They’re
The plethora of video types that people watch on browsing. They’re discovering. They’re
the Web complicates matters for advertisers. searching. I think it just confirms something
that I think we’ve known for a while but the
The majority of video content people watch online is short video, market overlooks, which is the new
at least when measured by streams instead of viewing time. consumer behavior and new opportunity is
Among the active viewers polled by Veoh/Forrester, 51% or more in video.” —Erick Hachenburg, CEO, Metacafe,
watched various short-form content (such as user-generated); in an interview with eMarketer, July 2009
clips from movies, music or TV shows; and local or national news.
Similar data from the Magid/Metacafe report also show that
Types of Online Video Content Viewed by US Active* people mostly watched short content: user-generated video, news
Online Video Viewers, August 2008 (% of respondents)
stories and music videos topped this list.
Video posted by people like me (e.g., on YouTube, Google Video)
71% Only 25% of respondents in this survey regularly watched full-length
Movie clips or trailers TV shows, or one-half of the figure in the Veoh/Forrester poll. However,
63% Magid/Metacafe surveyed the broad audience of people who have
Music clips or trailers ever watched video content online, while Veoh/Forrester surveyed
59%
only those who watched more than 1 hour of video per week.
Clips from current TV programs
57%
Types of Online Video Watched Regularly by US
National/local news Online Video Viewers, April 2009 (% of respondents)
55%
Videos shot and uploaded by consumers to sites like YouTube 42%
Comedy or other humorous online videos
51% News stories 32%
Full-length current TV episodes Music videos 31%
50%
Movie previews 29%
Sports news/highlights/events
39% Comedy/jokes/bloopers 26%
Full-length movies Full-length TV shows 25%
33% Weather 20%
Clips of TV shows that aren't on TV anymore
Clips of TV shows 18%
32%
Full-length TV episodes that aren't on TV anymore Sports content 16%
28% Full-length movies 15%
Commercials or promotional video created by companies to Adult entertainment* 14%
promote their brands
25% Video game content 12%
Animation, anime and cartoons Short films 10%
25%
TV previews 9%
Adult entertainment
20% TV commercials 7%
Note: n=832 ages 13+; viewed in the past month; *those who watch more Other 3%
than 1 hour of online video per week
Source: Veoh Networks, "Watching the Web: How Online Video Engages None 6%
Audiences" conducted by Forrester Consulting, October 8, 2008
Note: n=1,279 ages 12-64 who have ever watched online video content;
098724 www.eMarketer.com
*asked of respondents ages 18+
Source: Frank N. Magid Associates, "Magid Media Futures 2009:
098724
Opportunities in Online Video" sponsored by Metacafe, July 7, 2009
105276 www.eMarketer.com
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Marketing to the Online Video Audience 14

15. What People Watch (and Why)
Among US Internet users in general, the UK Office of Ad Length versus Content Length
Communications (Ofcom) found that 47% watched short video How long a video ad runs is often directly related to the length of
clips, but only 23% watched longer video content such as feature the content. Logical. Many marketers understand this, as in a fall
films or complete TV programs. 2008 survey from MarketingSherpa, where 48% of respondents
said that for each 60 minutes of online video content, the ideal
Online Video Consumption of Internet Users in Select length of advertising would be 1 to 5 minutes. At the high end, 5
Countries, by Type, October 2008 (% of respondents)
minutes of advertising would mean one 30-second streaming ad
Watch or Watch or download
download short longer video (preroll or midroll) for every 6 minutes of content.
video clips* content**
Canada (n=1,000) 50% 22% Ideal Length of Ads per Online Video Content-Hour
Germany (n=1,002) 47% 14% According to US Marketers, October-November 2008
(% of respondents)
UK (n=1,001) 47% 23%
US (n=1,010) 47% 23% 0 minutes/find other methods 10%
Italy (n=1,003) 45% 27%
1-5 minutes 48%
France (n=1,000) 43% 21%
5-10 minutes 29%
Japan (n=1,003) 39% 18%
Note: ages 18-64; *including those made by other people; **such as 11-15 minutes 11%
feature films or complete TV programs
Source: Office of Communications (Ofcom) - UK, "The International 16-20 minutes 2%
Communications Market 2008” conducted by Synovate, November 20,
2008 Note: n=1,083
100522
Source: MarketingSherpa, "Video Marketing Survey," November 2008 as
www.eMarketer.com
cited in "Marketing With Video Report: Online, TV & Mobile," December
100522 2008
Even though short videos limit marketers’ options, professionally 103551 www.eMarketer.com
103551
made short content is often welcomed by both advertisers
and audiences. Audience surveys indicate that even though many enjoy short
professional clips, they still express limits on the advertising
The Magid/Metacafe report focused on short-form professional attached to the content. Perhaps those limits are not as strict as
content that averaged 90 seconds, including music videos, movie anecdotal evidence suggests.
trailers, TV clips and sports highlights. Among Internet users who
watched such pieces, 37% said the content was equally or more A 2007 Dynamic Logic study found that a 10-second-plus preroll ad
entertaining than full-length TV programs shown on a TV set. was all that Internet users were willing to watch before a 5-minute
clip—although ad length tolerance nearly doubled to over 20 seconds
That result reinforces the predominance of video snacking on the when the study excluded those unwilling to watch any advertising.
Web, where the lean-forward nature of the medium encourages
short consumption. That also implies brand marketers might do
well to develop more video ads that suit the growing universe of
short professional video content.
US Online Video Viewers* Who Find Short
Professional Online Clips** Equally or More
Entertaining than Full-Length TV Shows on a TV Set,
April 2009 (scale of 1-5)
1 (strongly agree) 13%
2 24%
3 41%
4 14%
5 (strongly disagree) 8%
Note: n=883 ages 12-64; *who watch short professional online clips;
**includes music videos, movie trailers, TV clips, video game trailers and
sports highlights
Source: Frank N. Magid Associates, "Magid Media Futures 2009:
Opportunities in Online Video" sponsored by Metacafe, July 7, 2009
105275 www.eMarketer.com
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Marketing to the Online Video Audience 15

16. What People Watch (and Why)
While there have been many changes in the online video universe Professional versus User-Generated
since this study was done two years ago, the greater abundance The US audience’s taste for online video appears balanced,
of video today makes many Internet users more accustomed to according to Deloitte’s annual “State of the Media Democracy”
advertising, even as it also makes some more resistant to online report, with 70% watching user-generated and 71% watching the
video ads. professional kind.
Average Length of Ad that US Internet Users Are US Internet Users Who Watch User- and Professionally
Willing to Watch Before an Online Video, September Generated Video, September-October 2008 (% of
2007 (seconds) respondents)
Video length Length of ad Length of ad Watch user-generated video 70%
among all users excluding users
(seconds) unwilling to of which: % who regularly watch a complete video 80%
watch any ad Watch professionally generated video 71%
(seconds)
of which: % who regularly watch a complete video 79%
10-minute clip 14.70 26.90
Note: n=2,056
5-minute clip 10.78 20.36 Source: Deloitte, "State of the Media Democracy Third Edition," provided to
2-minute clip 7.23 13.71 eMarketer, January 12, 2009
105617 www.eMarketer.com
1-minute clip 6.23 11.44
105617
30-second clip 4.61 8.58
Not only do brand marketers trust professionally created videos
15-second clip 3.48 6.13
far more than user-generated, but nearly all longer (10 minutes or
Note: n=933 ages 18+
Source: Dynamic Logic, "AdReaction 2007: Consumers' Perceptions of more) online videos are professional content. The universe of
Advertising," provided to eMarketer, October 2007
professional video content can be categorized into several types:
106681 www.eMarketer.com
106681 ■ Full TV shows
However, when audiences watched short videos of 5 minutes or
■ Full movies
less, their ad time tolerance got restricted, along with the ad’s
placement. The same Dynamic Logic study found that for midroll ■ Clips from TV shows or movies
ads, a 5-second spot was OK for 75% of respondents, but only 11%
of respondents or fewer were willing to watch when the ad length ■ Made-for-the-Web shows (often less than 10 minutes long)
grew to 10 seconds or more. ■ News, weather, sports (often from TV networks or local stations)
Length of Ad* US Internet Users Are Willing to Watch ■ Educational and informational
During Their Online Video**, September 2007
(seconds)
Before the During the After the “Most advertisers want to have a high degree
video video video
<5 seconds 45% 75% 47%
of comfort around the nature of the content
10 seconds 23% 11% 19% that they are sponsoring.And so the sheer
15 seconds 16% 5% 14% process of managing the millions of assets out
30 seconds 12% 6% 14% there—it would really only come down to the
45 seconds 2% 1% 2% most popular. OK, squirrel on a skateboard,
1 minute 2% 2% 3% that gets 10 million views.Why not? But by the
2+ minutes 0% 1% 1%
time it got to 10 million views, it would be too
Note: n=933 ages 18+; *before, during or after the online video; **five
minute news clip or video late. Maybe you’d catch the last million
Source: Dynamic Logic, "AdReaction 2007: Consumers' Perceptions of views.” —Brian Wieser, SVP global director of forecasting,
Advertising," provided to eMarketer, October 2007
092814 www.eMarketer.com MAGNA, in an interview with eMarketer, June 2009
092814
The online video audience spends more time watching
professional content, too. That extended time gives marketers
more opportunities to place ads in front of them, and more
opportunities to test different ways of delivering video-based
marketing messages.
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Marketing to the Online Video Audience 16