Emily Steel reports in Friday’s Wall Street Journal that Toyota has launched a new video marketing campaign on YouTube. Essentially, YouTube is creating a high-end microsite that offers contests and culls appropriate content from the YouTube’s user-generated videos.

The result is one of the most intricate and expensive campaigns ever on YouTube; Toyota is paying about $4 million for it, according to a person familiar with the campaign. Its main feature is a new destination on the site, dubbed “Best in Jest,” that has been designed for Toyota. Special algorithms created by YouTube find up-and-coming comedy videos on the site each week and feature them in that space. Toyota also is sponsoring a sketch-comedy contest on the site called “Sketchies,” where users can post funny videos with the chance to win as much as $25,000.

YouTube is also offering lightly-customized contests to marketers:

YouTube lets advertisers submit the different creative components, such as the idea, the prizes and the graphics and control certain functions such as the start and end dates. YouTube enters these into a contest-maker program, and out pops a custom-made contest.

Both the custom-microsite and custom-contest offerings revolve around attaching user-generated content (UGC) to your brand.

But what if you don’t have $200,000 to $4 million to to create & run a custom UGC campaign? You can always create your own content and use the YouTube platform to help distribute it. Good news — for that, YouTube won’t charge you anything. The WSJ article reports:

… some advertisers are creating campaigns on the sites without actually paying the sites to create the content. Tax-preparation giant H&R Block is running a social-media campaign on YouTube, Facebook and MySpace, but the campaign was created by 360i, a small digital-marketing firm, and marketing firm MRM Interactive. The campaign involves games for the sites and even a profile and videos about a tax-obsessed character named Truman Greene. H&R Block simply posted the content to YouTube and Facebook just as anyone else would. One saving grace for the sites: H&R Block is buying standard banner ads on the sites to promote the new content.

Filed under: YouTube, effective online video, marketing, online advertising, strategy, video