The Decline of the Companion Banner - Shane Steele - MediaBizBloggers

In my last post "CES 2010: What it Means for Video Advertising," I shared a few predictions for the online video ad industry. Among them was that the "companion banner" (i.e. the banner ad that appears adjacent to an in-stream video ad), will eventually fade away as the industry evolves towards more optimal formats for online video advertising.

This is not to say that companion banners don't have a perceived value. From the advertiser's perspective, companion banners provide the benefit of complementing in-stream ads with an opportunity for persistent branding, messaging, and user interaction during program viewing. However, there are a number of factors that together are causing the industry to move away from companion banners as a standard for in-stream advertising:

1- The companion banner is now an unnecessary vestige of early Web video

In the early days of online video, companion banners were introduced by publishers as a way to track video impressions. Since tracking pixels couldn't be added to video itself, publishers added a companion banner which could be tracked as a proxy for video impressions. With advances in Flash technology, a tracking pixel can now be fired from within the video environment so there's no longer a need for the companion banner for tracking purposes.

2- The companion banner is not a significant driver of CTR

Companion banners were also originally introduced as a way to drive clicks with online video. But if you look at the stats, companion banners aren't a significant driver of CTR. Based on data from the thousands of campaigns we've run at Tremor Media, the companion banner typically contributes a small percentage of click thrus for a pre-roll video ad. To make matters worse, there's often confusion over CTR (and eCPM) calculations given the lack of consistency with how companion banner impressions are factored into these numbers.

3- Full screen experiences don't lend themselves to a companion banner ad

As broadband penetration and speed increases, publishers can deliver richer viewing experiences such as larger player sizes and expanded players that can support full screen viewing which squeezes out the real estate used by the companion banner. Hulu, MLB.com, CBS.com and Yahoo are some notable examples of sites that have moved away from standard companion banners.

4- Companion banners are a hurdle for standardization and "TV Everywhere"

Advertisers rely on ad networks and publisher syndication networks to achieve scale for their ad campaigns, which means delivering ads across many sites for any given campaign. Video ad serving platforms and ad networks have built tools to manage the complexity of dealing with different player sizes and formats to ensure the right ad format and size is delivered correctly to each site. However, companion banner acceptance is still an issue for some, and a potential hurdle for fluid cross platform advertising, such as the push for "TV Everywhere".

Since my last post, several agency and advertising colleagues have asked for a point of view on how this trend will impact them. So here goes:

· Media Planning: Online video plans should not have a requirement of 1:1 correlation between in-stream impressions and companion banner impressions, especially on the most premium sites and content. Furthermore, advertisers and their agencies should take advantage of new interactive formats that can bring the functionality of the companion banner (and more) into the player environment such as data feeds and live polls (see examples here).

· Media Analytics: It's been said over and over, but still worth repeating: there's way too much focus on click thru rate. The metrics that matter are engagement and impact – both attitudinal and behavioral – which can be measured through a number of research providers. Companies such as Dynamic Logic and Dimestore no longer require a companion banner to track and survey users exposed to campaigns for branding measurement. If you're wondering about ad effectiveness of the video vs. flash companion banner, there are several research sources (such as Dynamic Logic) that across the board show video is more effective than display in terms of brand lift.

*Source: Dynamic Logic MarketNorms data through Q309

· Creative: Creative teams should position for the change by leveraging formats that support interactivity and engagement within the player environment. These advanced in-stream formats allow creatives to push the boundaries of online video campaigns beyond repurposed TV spots to create non-linear narratives and interactive experiences that engage the viewer inside the player. Instead of video-centric micro sites, think about creating Web site-like video ads. And if you're still going to use a companion banner, take advantage of interactive elements to allow for engagement, not just click thru.

While companion banners still dominate video publisher sites, over the next few years, wide spread adoption of larger and full screen video environments, and more interactive in-stream formats will be the driving force in the eventual death of the companion banner. My company estimates that about 95% of all pre-roll ads currently are served with a companion banner, but this number is predicted to come down to about 80% before the end of 2010, particularly among premium publishers. The companion banner may not be dead yet, but in a world of full screen viewing experiences and premium content, the overlay will become the new companion banner. What do you think?

Shane Steele is a media and marketing executive with 14 years experience in digital media and brand marketing. She is currently Vice President, Marketing at Tremor Media, the largest video ad network where she oversees all of the company’s marketing efforts. Shane can be reached at ssteele@tremormedia.com You can also follow Shane at http://www.linkedin.com/in/shanesteele and http://twitter.com/shane_steele .

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