Local Video Advertising on the Move

After catching my breath after The Kelsey Group’s Drilling Down on Local ’07 conference (and catching up with other things), it’s (finally) time to recap the biggest theme I took away from the show; local video advertising.

Video took center stage, with a palpable difference from past shows in the amount of chatter on and off the stage about local video advertising. Thankfully, a lot of examples of video ads were shown, which was a telling indication that local video ads are actually being created. It’s still an early adopter ad medium, but it’s happening.

A second example came during a panel of real-life small businesses (a small but telling sample), which all admitted to local video ads currently in production. A bay area roof rack shop owner disclosed that he is working with TurnHere (see examples here) to create a video ad, while a cosmetic dentistry practice in San Jose is working with a smaller video production house to make a short video ad.

TurnHere SVP of Business Development John McWeeny sat on a video panel that I moderated and asserted that the interest in video among the small business segment is growing from his point of view. Selling video ads can also be easier than selling some forms of online performance based advertising to small businesses, making it a nice add on to product bundling by yellow pages sales channels. Yellowpages.com VP of marketing Matt Crowley and Yellow Book CMO Gordon Henry made this claim in separate panel discussions.

“Sales reps get it and advertisers get it. It’s something that everyone can relate to,” said Henry. This comes down to the belief that video is something that a lot of small businesses “get” compared to online performance-based marketing such as pay-per-click that may be less attractive and more abstract to some small businesses.

The key here though, is that accessibility to online video production and distribution is falling within the grasp of small businesses thanks to companies like TurnHere and Spot Runner, which also had a big presence at the show. Spot Runner CEO Nick Grouf demonstrated during a keynote address how the company can drastically undercut ad agencies with new forms of creative and an automated process of customized production and cable buying.

From a user perspective, online video is hot and there is clearly a growing affinity towards it, thanks in part to the popularity of YouTube. Rising broadband adoption, high speed fiber network deployments, and interconnected devices within the home (see Apple TV), will only increase this. Advertiser adoption in creating online video ads or viral video promotion (see example from ShopLocal), is conversely in early adoption, but happening slowly. Business models based on video creation and distribution are meanwhile few in number.

So where does this leave us? All of these factors (user demand, advertisers & distribution models) affect each other’s growth and exist in a sort of 3 way chicken and egg scenario. Question marks still surround where and how local videos ads should be distributed and what are users preferences are for watching them (should they show up alongside related online yellow pages listing? exist in their own searchable library of directional local video ads?, etc.).

The bottom line is that a great deal of adoption and development need to happen before video reaches any semblance of mainstream adoption in the local advertising space. But the wheels are in motion.

We’ll outline some of the other takeaways from the show in a SearchDay article next week.