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BizReport : Advertising archives : November 25, 2008

Online video viewers want ads their way

When given a choice of watching ads during or before an online program, viewers on Hulu overwhelmingly voted for pre-roll ads, according to recent data from the online video content site.

by Helen Leggatt

A huge 88% of Hulu viewers have opted-in to view a 2-minute ad shown prior to the presentation rather than several 30-second ads during any 22-minute program. While long-form ads aren't commonplace on Hulu, the recent data seems to suggest that offering viewers the option gives them the control they crave. It could be assumed that by choosing which ads they see, viewers will be more engaged with those ads.

Overall, 93% of Hulu's site users said that they thought the site had the right amount of ads in exchange for free video viewing.

"The opt-in rate is proving this is something people want," said Christina Lee, a Hulu spokeswoman.

"We are trying to break down a lot of these very traditional ways of thinking about advertising, so this is a way to experiment and an example of something you'll see us doing," Lee added.

Another study, this time from IBM, adds clout to Hulu's findings. IBM found that, on average, 70% of global respondents preferred ad-supported online video models as opposed to consumer-paid. Their data also pointed to the preference of non-interrupted online viewing with pre- and post-roll ads favored by the majority.

"Consumers have grown accustomed to accessing new forms of content through alternative sources, such as online video and video-on-demand, at no cost to them -- no fee, with very limited advertising shown," said Saul Berman, Global Lead Partner, Strategy & Change Consulting, IBM Global Business Services. "The industry must find appealing ways to monetize new content sources or risk a similar fate as that of the music industry where value shifted away from core players."

Tags: ad-supported, online advertising, online content, online video, post-roll, pre-roll, video advertising

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