May 30, 2006 4:00 AM PDT
Google's video replay
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Advertisers can choose which sites they want the ads to appear on, and they can target their ads based on keyword, content relevance, demographics and geography. Web site publishers can choose not to accept any video ads on their sites, although none have opted out so far, Rajaram said.
Google also will tell marketers how many people play a given video as well as what the average viewing duration is, he said.
The company had 12 beta testers for the service, including Paramount Pictures, Fox Home Entertainment and General Motors.
Rajaram said internal testing has shown that video ads outperformed text ads in most cases. Google may eventually show video ads on its Google Video site, he added.
Several studies seem to back up Rajaram's claim. A study released in March by the
A May 2005 survey from Dynamic Logic and Viewpoint/Unicast found that more people were annoyed by pop-up ads and television ads than by online video ads.
"It's amazing how many people do click on video ads," said Gary Stein, strategy director at Ammo Marketing. "Video ads have been shown to be pretty powerful. They also have this good branding effect."
The ads viewers want to see are ones that are highly targeted and offer interactivity, experts also said.
"Do people want to click on video ads? It depends. If you make it fun, if it's a game, a contest..." said Weiner of Gartner. "Just taking a Zantac ad and moving it to the Web is boring."
Debate aside, Google faces formidable competition in the video arena. In addition to video ad veteran Yahoo, there's Microsoft and AOL "who have very sophisticated media players," AccuStream's Palumbo said.
AOL, in particular, has been charging full speed ahead with video. In January, the Time Warner division bought video search engine Truveo and just this month acquired Lightningcast, an online-advertising company that specializes in the placement of streaming video and audio content.
Google hopes that AOL--with whom it inked a multiyear search and marketing partnership late last year in exchange for an investment--will send some of its advertisers over to Google's video ad service, Google's Rajaram said.
Microsoft, meanwhile, said in April that it would buy Massive, a company that inserts ads in video games.
Google is moving beyond online ads, whether static or video. The company began experimenting last summer with print ads and with newspaper ads earlier this year. Google also announced plans in January to buy DMarc Broadcasting, which sells radio ads.
And it probably won't stop there.
"Google has made early forays into print and radio (with limited success)," a Merrill Lynch research note said. "However, we expect further innovation (targeting on traditional advertising mediums can improve) and we envision long-term opportunities for Google to develop partnerships to deliver targeted video advertising for on-demand TV viewing."
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