Is online video advertising more effective than conventional TV advertising?

Budgets are rapidly shifting to Online Video adverting. A Nielsen survey established that online video ads had a 65% general recall compared to 46% for TV ads. Brand recall was also higher for online video ads  -  50% compared to recall for TV ads – 28%.

Video ads have higher click through rates 0.4 – 0.74% as compared to JPG of GIF images where CTRs tend to  be between 0.1 and 0.2 %.

Ad agencies have also begun to realize this shift and an increasing number of agency media planners/buyers are planning to invest in online Video ads. 94 % in Q1 2010,  up 7% from an already high 87 % in Q1 2009’. See table below-

Why is online video advertising bigger than TV advertising?

Interactive v/s static

The ‘interactive’ quality of a video ad is at the heart of its effectiveness. Users click the ‘play’ button twice more often than they click thru’ a JPG of GIF image.

On a TV commercial you cannot question the company producing it. Some of the (mis)information  keeps rankling the viewer’s mind. An online video ad, on the other hand is more interactive. The viewer has the advantage of clicking through and reading more information on the product/service. Depending  upon how the video ad is run, the viewer also has the option to ask questions seeking clarifications. Questions can be asked thru’ the website’s interactive page, thru’ instant messaging etc. Clearly, online Video advertising is much, much more powerful user experience in terms of interactivity and clarity of the product/service.

Relative newness of the Video ads

Video ads are clearly at the growth stage of the product life cycle (PLC), if there was one for video ads. The novelty value contributes to higher CTRs.

Flexibility

The psyche of the average consumer is that he/she doesn’t like to be compelled into watching a video ad. There is no running away from TV ads. The only option the viewer has is to switch off the TV. The online video ad experience, on the other hand, is elective.  The viewer is not put off a video ad – because there is no compulsion to watch it. On the other hand a clever copy or tagline will encourage the viewer to click thru’ and see what it is about.

Targeting

TV ads are targeted to the mass market. Content has to be middle-of-the-road – appealing to the average user. Targeting is more generic and  less effective. Online Video ads, however, can be targeted at a specific demographic and content tailor made accordingly. Focused content gets better results because it appeals more powerfully to the target market.

Online video advertising thus has everything going for it at the minute. Handled well, it is here to stay.