Online ads make their way into videos

ScanScout president discusses the future of online advertising

Lau

Online video and advertising--two growing markets in their own right--have not always gone hand in hand. Especially with user-generated content, marketers are often reluctant to equate their brands with unpredictable content. One company confident that the worlds of online video and advertising will find a common ground is ScanScout. This online video advertising firm--whose clients include NBC Universal, Sony Pictures, McDonalds and DanceJam, the start-up soon to be launched by Stanley Burrell (better known as MC Hammer)--has often been touted as an example of online ads done right. The company combines video overlays with online content to monetize that content for its advertisers and publishers. ScanScout co-founder and president Waikit Lau shared with Associate Editor Sarah Reedy the keys to the company’s success moving forward as more and more videos go online.

On what makes ScanScout unique: ScanScout's targeting, brand protection and flexible business model sets it apart from other online ad companies. Also, the U.S. Patent and Trademark Office recently awarded ScanScout with trademark protection for its Brand Protector term, and the company's application for patent protection on the technology and process is pending approval.

On ScanScout’s business model: ScanScout upends the established model of digital video delivery through its sophisticated technology that enables the right creative to be delivered at precisely the right time to the right consumer while also creating additional inventory for the publisher within and around their video content. ScanScout employs both CPM and CPC pricing models with their marketing and publisher partners.

On the efficacy of online advertising within video: Some of the campaigns ScanScout has managed in its first year have performed marvelously, driving tremendous results for marketers and significant incremental revenue for publishers. The market is still in its early stages. However, we are seeing advertisers and publishers accelerating their adoption of online in-stream overlay ad units as a viable, user-friendly ad format.

On striking a balance between monetizing video, preserving the user experience and protecting advertisers: ScanScout's Brand Protector--the only one of its kind in any media--is the most powerful technology ever devised to analyze online video content and determine if the video is an appropriate match for an advertiser's brand before serving the ad. ScanScout is the first online video network company to productize a method to ensure that advertisers' brands are not aligned with content they deem out of context or in any way inappropriate and enable brands to embrace user-generated video content (UGC) in a brand-safe manner. And since all video ads on ScanScout's system are user-initiated and invitations are served only at the most relevant moment, the user experience remains favorable--not intrusive.

On consumers’ reaction to online ads: The UGC sites that ScanScout does business with have reported very favorable results. ScanScout's user-initiated model is a seamless element with the UGC interfaces of its publisher-partners.

On the future of online video: The answers to this question--far more than market sizing projections--are what make the digital video segment so interesting today. Online video will look as different in the future compared with today as it does today compared with five years ago. One thing that most analysts seem to agree on is user or consumer control playing a prominent role. This is a key reason behind ScanScout's user-initiated model.