E-Commerce Times has an excellent survey on the state of online video advertising. Although written last year, John Mello’s summary of the current video ad landscape remains insightful and (thankfully) concise.

A few observations from the article:

• 65% of broadband users occasionally watch video online (as of 2007). In 2006 the number was 44%
• while “YouTube hypercharged this industry… advertisers tend not to want to touch [user-generated content] with a 10-foot pole. If you’re dipping your toe in the water, you’re not going to want your first dip to be something risky” (Mike Shehan, CEO of SpotXchange)
• In 2007, the Internet video advertising market is 1% of the TV advertising market. eMarketer projects that it could be 10% by 2011.
• High-quality video inventory from reliable publishers is scarce
• Repurposing TV commercials for use on the web “has generally not proven effective, and advertisers and publishers alike have moved strongly away from 30-second spots for much online video”
• “The need to re-edit or shoot new creative may have created barriers” to online video advertising
• 30-second and 60-second commercials don’t play well on the web. “Switching costs online are so low it’s easy for someone online to get annoyed at an overbearing ad or too may ads or too many repeats of the same ad and go away”
  

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Filed under: YouTube, effective online video, market size, online advertising, video