Digital video brings sight, sound, and motion to the Internet experience. Thanks to high-speed Internet access and video compression techniques, the use of digital video is now widespread and increasingly popular among consumers who frequent YouTube and other user-generated content sites. As major Madison Avenue agencies encouraged their clients to try digital video, it gained traction as an advertising form. Procter & Gamble, Coca-Cola, and McDonald’s, among other major brands, have all funneled millions into the tactic. eMarketer predicts that spending on digital media advertising will reach $4.5 billion by 2011, up from $775 million in 2007.

Marketers can create a variety of digital video formats, from straight advertising messages to demonstrations to creative content designed to entertain. Creating a digital video requires a digital video camera and a computer with enough storage and processing power to edit and manage your footage. A soundtrack, voice-overs, and special effects can be added. Technically adept users can tap resources from providers such as Apple, which includes digital video technology as part of its computing packages and also offers consulting help.

Those who currently use television as a marketing tool are beginning to discover the benefits of online video advertising. Most of the buying is done by interactive agencies on behalf of major marketers, reports the Interactive Advertising Bureau (IAB). The majority of ads are repurposed television spots. While the tactic is not out of reach for growing businesses, the larger companies have been first to reap the benefits.

The first step is deciding what kind of video you want. The basic choice is between what experts call “premium” — that is professionally produced by a traditional agency with an expertise in television or by a specialized interactive agency — and user-generated content. Major marketers using digital video advertising, such as Procter & Gamble, tend to rely on professionally produced shorts, but some, including Burger King, have embraced the use of fan-created digital films as marketing material.

Once the video exists, the next step is placing it in such a way that it will support your online marketing goals. Digital video ads can be found on a range of sites, from large portals to small, specialized sites. A study by the IAB finds digital video advertising buying mirrors other media buying behaviors. Today, most buying of digital video is being done by interactive agencies on behalf of the major marketers. Also, many Web sites deploy in-text video advertising within their content pages. The IAB follows the emerging format closely and is a good place to start for the latest trends (www.iab.net). YouTube hosts many of the latest consumer generated content examples of this tactic. And marketers with experience in the tactic, such as Procter & Gamble, frequently update their product-specific Web sites with new digital video ads.

Case in Point
Technology firm Hewlett Packard tapped Microsoft’s MSN Video network to promote its Photosmart Printers. Using its popular television ads, in which people hold up empty white frames that magically turn into crisp, clear photos, HP tested the impact of digital video. Surveys showed that television and digital video advertising had a similar impact on viewers: 84 percent of those who saw the TV ad thought it conveyed news and a new idea, and 83 percent of digital video viewers had the same reaction. Similar numbers of viewers found the ads believable and enjoyable. HP concluded that digital video allowed the company to reach light TV viewers with the same advertising content delivered in a new format.

Quick Tip
Some observers contend that major marketers have achieved success in digital video advertising due to the quality of their content, not necessarily on the delivery format. The original spot for the HP White Frame ad was created by a team of ad experts from Goodby, Silverstein and Partners, led by award-winning French director Francois Vogel. And it took 37 takes just to generate the raw footage. In other words, creating a high-quality TV ad is not a cheap proposition.

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