ADOTAS –

What follows is the text from the case study, in its entirety.

The Power of Visual Effects to Drive Audience Engagement and Video Content Popularity

The world’s production and consumption of video is exploding as more and more businesses and consumers use video to build relationships, entertain, educate, or persuade audiences. By 2014, nearly 90% of online consumer traffic will be video. New online video creators will have the same need to drive audience engagement as Hollywood and broadcast television have had for years. As context, for decades, media companies, studios, and advertising agencies have invested in using visual effects to drive audience engagement as measured using a number of metrics including: audience involvement, interaction, influence and brand proclivity. Now, online video creators and distributors can use visual effects to engage viewers, increase popularity and drive purchase intent for the first time. This research report highlights how visual effects can be used to drive business benefits in content development, ad premiums, and audience growth.

Key Findings

• Visual effects increase video appeal, preference, and likelihood to watch again
• Visual effects increase viewer’s brand consideration, likelihood to purchase, and likelihood to download a coupon for the advertised product and lessen negative responses along similar measures
• Visual effects are the reason cited for preference over the same content without visual effects

Business Implications

The use of visual effects can drive video popularity, increase the value of published content, and improve the return on advertising investment.

Situation Analysis

Online video aggregators and content distributors such as YouTube, Break.com, Pixelfish and Vimeo are driving unprecedented audience volumes but are not always capturing their fair share of time spent by consumers watching and engaging with video content. In February 2011, according to GenArts research, the average U.S. YouTube user watched two hours and 14 minutes of YouTube content, compared to the greater than five hours per month spent on sites that distribute network and broadcast-quality content, such as Hulu and Netflix. The primary driver of this difference is that sites like YouTube rely heavily upon user-generated content that lacks the story and production quality needed to engage today’s viewers. As a result, online content networks are not maximizing the value of their audience reach and are not able to command the full premium for their ad inventory or subscription services that their audience reach may warrant.

This challenge to engage users is not limited to YouTube. The use of video is exploding and becoming the primary means of communication. By 2014, as mentioned earlier, more than 90 percent of all online consumer traffic will be video, and the number of video creators is estimated to increase from 350,000 today to more than 220 million.

As more and more individuals and small-to-medium-businesses use video to inform, influence, and entertain, they face the same challenge to engage users as the legacy broadcast networks and their advertisers. Viewers today expect both a compelling story and the same production values as seen on television, in commercials, and at the movies. Movie studios, broadcast networks and advertisers have long understood the need to engage as they compete for users’ attention. They invested in not only great storytelling but also enhanced production values across lighting, sound, and motion graphics to entertain, influence, and grow audiences. One of the least-investigated methods of enhancing production value has been the use of visual effects (“VFX”); how VFX drive audience engagement is a similarly uninvestigated topic of research.

Research Hypothesis

Video treated with visual effects will outperform untreated video across a number of engagement metrics. In 2007, Forrester Research defined engagement as “the level of involvement, interaction, intimacy, and influence that an individual has with a brand over time.” In a media-specific context, the brand elements or content that users engage with first is the show content and then, by extension, the publisher of the content, and finally, the ads seen on the network. For example, the popular television show House engages fans with its content, and FOX is the network and the platform publishing and monetizing the content. Advertisers running on the FOX network, like Coca-Cola or Nike, capitalize on the targeted audience to drive sales. In this case study, we hypothesize that the targeted use of VFX can help increase video appeal, brand preference, and purchase intent.

Case Study Context

Since 1996, GenArts’ customers have been using its visual effects software to create looks in video to set the mood, brand products, guide the audience, improve quality, and reduce costs. In this research effort, GenArts tested its working hypothesis that video treated with VFX will outperform untreated video. In May 2011, GenArts tested a national footwear company’s product video advertisement to determine how the use of visual effects impacted brand consideration, audience engagement, and purchase intent.

Research Purpose

• Measure the impact visual effects have on audience engagement
• Identify if visual effects influence audience engagement, recall, and overall likelihood to recommend, watch again, purchase, or forward
• Measure how these trends change between demographic groups

Research Goals

• Evaluate the control and enhanced video versions within a cell against each other
• Determine if the enhanced video version elicits the highest overall appeal

Methodology

In May 2011, GenArts worked with MarketTools, a leading online market research company to run a research study to quantify the impact of visual effects on audience engagement using a national footwear company’s video promotion for a new footwear model. GenArts submitted two video advertisements, one treated with visual effects (“treated”) and one without visual effects (“untreated”) to be tested with the MarketTools’ online panel of 518 18- to 54-year-olds split evenly between men and women. The advertisement promoted a new footwear product targeted specifically toward males between ages of 18 and 54.

Respondents were randomly shown one of two versions of a video advertisement created by a leading footwear company: one with the untreated video ad first and the treated video second or one with the treated one first and the untreated one second. After watching the first video, respondents were asked a series of twenty questions about the video they had seen. After answering questions, respondents were then shown the alternate version of the ad and asked additional questions. Respondents were asked questions based on several key attributes and behaviors: likeability, engagement, memorability, and purchase intent.

Key Findings

Overall, the video ad with visual effects outperformed the untreated video ad. Specifically:

• Adults found the treated video ad to be more appealing (+4%), more unique (+3%), and were more likely to watch the video again (+6%)
• Visual effects decreased the likelihood of adults to fast-forward or abandon the video by 5%
• Visual effects increased purchase intent and likelihood to download a coupon by 4%
• The majority of those who saw the untreated video first preferred the enhanced video
• Over 90% who saw both videos cited visual effects as they reason they preferred the treated video to the untreated video

The target audience — men — responded significantly more positively toward the videos with visual effects. In some cases, the lack of visual effects had greater negative impact on engagement measures. Specifically:

• Men found the treated video to be significantly more appealing than the untreated video (+14%) while the ad lacking visual effects was significantly less appealing: 22% rated it as “not very appealing” vs. 14% in the VFX-enhanced video test
• Men were 9% less likely to stop watching the treated video before its end vs. the men in the untreated group
• Men were 13% more likely to consider purchasing the advertised footwear brand vs. the men watching the untreated video
• The lack of visual effects increased negative brand consideration; male targets watching untreated video were 11% more likely to definitely not consider the brand vs. men watching the VFX-treated video
• Purchase intent among male viewers of the treated video increased 9% compared to men who watched the untreated and 12% compared to all adults who watched the untreated ad
• Without visual effects, the video ad was less effective; men in the untreated group were 13% more inclined to not download a coupon vs. the men in the treated video group

Question: How appealing is the advertisement you just watched?

Analysis: Ad Appeal

Adults in the enhanced video group found the footwear ad with visual effects more appealing than the untreated ad and rated the enhanced video 4% higher in the top two boxes (extremely appealing or very appealing). The target audience, men, found the enhanced video to be significantly more appealing—14% more appealing in top-box ratings at a 95% confidence level—than the men in the untreated group.

Furthermore, men in the untreated group found the untreated video ad to be significantly less appealing—8% more rated the ad in bottom two boxes (“not at all likely” or “not very likely to watch again”) at 90% confidence level—than those men in the enhanced group.

Question: How unique do you feel this video is compared to other advertisements for similar products?

Analysis: Uniqueness

Overall, adults found the video with visual effects to be slightly more unique; however, the target audience of men rated the video with VFX to be more unique than the untreated group.

Visual effects counteracted the negative ratings of the video—29% of the men watching the untreated video judged it as not very unique compared to just 19% of men watching the enhanced video.

Question: Based on the ad you saw, how likely are you to watch this video again?

Analysis:  Repeat Views

Visual effects improved repeat viewing by 3% overall and drove a greater impact among the intended target. Men watching the treated video indicated they were significantly more likely to watch the video again: 8% higher than men watching the untreated video and 15% higher than women in the untreated group (at an 80% confidence level). This is most likely due to the targeting of the ad toward men.

Question:  If viewing this ad online, how likely would you be to fast-forward or close out this video before it is finished?

Analysis:  Abandonment

Visual effects decreased the likelihood to fastforward or abandon the video; adults who viewed the enhanced video were 5% less likely to abandon while the male targets, specifically, were 9% less likely to close out of the video than men watching the untreated video.

Question:  How likely would you be to consider buying this brand of footwear?

Analysis: Brand Consideration

Visual effects increased the male viewer’s willingness to consider buying the brand of footwear by 13%. Among the male targets, 47% would consider the brand compared to only 34% who watched the untreated video (at a 95% confidence level).

The lack of visual effects further polarized negative brand consideration. The male targets were 11% more likely to definitely not consider the brand (at a 95% confidence level) than those in treated group.

Question:  How likely would you be to consider purchasing this particular brand of footwear?

Analysis: Purchase Intent

Visual effects increased purchase intent among the adults watching the enhanced video. Among the male targets, purchase intent increased 9% versus the men who watched the untreated ad. Men who viewed the untreated video were much more likely to have a negative purchase intent than men who watched the VFX-enhanced video. Men viewing the untreated video were 13% more likely to probably or definitely not purchase the product (at a 95% confidence level).

Question:  How likely would you be to download a coupon for this product?

Analysis: Purchase Intent

Without visual effects, the video ad was less effective in influencing men to act. Men in the untreated group were 13% more inclined to not download a coupon (chose “Not at All Likely” at 95% confidence level), which is significantly lower than the men who saw the enhanced ad.

Question:  Now that you have reviewed both advertisements, which one do you prefer?

Analysis: Preference

There was a clear preference for the treated video among those who saw the untreated video first. Over 90% who saw the untreated video first cited visual effects as they reason they preferred the treated video to the untreated video.Both groups cited VFX as the primary reason for preferring the video ad.

Business Implications

Visual effects can help increase the ability of your video content to convert users to purchase.

• In this example, the national footwear company is directly marketing to a group of 1,000 prospects that might be interested in the footwear category. Without visual effects to enhance their video, the national footwear brand could experience negative brand consideration and start off with a smaller base of consumers who would consider purchasing their brand.
• In addition, the lack of visual effects lowers the likelihood of ad viewers to purchase the advertised brand of footwear. With the use of visual effects, the footwear company is able to increase its brand appeal overall with adults and with its target audience, men. The use of visual effects helps drive up purchase intent, which equates to a potential 26% gain in revenue for adults and a potential 81% gain in revenue from their target audience for the new footwear products.

Further Research Opportunities

This case study highlights the opportunity to conduct additional research around the targeted use of visual effects and fully understand the impact across demographics such as gender, age and geography. This example highlighted a commercial that was designed to appeal to U.S. males and further case studies can explore the impact in similar scenarios with ads targeting women as well
as investigating the impact of geography to fully understand the different ways visual effects can influence engagement across a variety of audience segments.

Here, then, are seven digital trends worth paying attention to.

1. Online events

According to a recent GlobalSpec Marketing Trends Survey, 47 percent of industrial companies are increasing their spending on online events. Online events, sometimes called virtual events or online tradeshows, are a trend made possible by high bandwidth availability and emerging technologies that allow media companies to produce and host highly-interactive experiences. Online events targeted to your specific audience offer you an excellent opportunity to showcase your product line, build your brand reputation, provide content to your audience, and connect with prospects and customers. What’s more, you can do it all from the comfort and convenience of your desktop — as can your audience.

2. Video

Video is experiencing a significant growth spurt — in fact, a high percentage of companies are increasing their spending on video, and it’s easy to see why. In the age of YouTube, videos are cheap to produce; homemade production quality is not only acceptable, but cool. Also working in video’s favor is the fact that many people like to watch, not read. Looking for some good ideas for video? Try brief interviews with executives, conversations among product managers, product demonstrations, or on-site visits to customers using your products.

3. Social Media

Although many companies have begun implementing social media, make sure you understand the specific reasons and goals for your own social media strategy. For example, the top reasons companies use social media are for branding and lead generation purposes, yet only 3 percent of companies say social media is one of their top three sources for leads. At this point in the maturation of the social media market, increasing brand awareness and building relationships are the most effectively achieved outcomes. LinkedIn is the most popular social media platform the industrial industry, for example, followed by Facebook and then Twitter.

4. Digital Content

A few years ago, everyone was saying, “Content is king.” Well, in many ways, content still is king — digital content — as attested to by the huge growth of e-readers, the iPad and other devices for consuming digital content. And it’s not just web pages. There are videos, webinars, downloadable PDFs, e-books, interactive tools and more. Your customers and prospects are hungry for content to help them do their jobs and make better purchasing decisions. Your job is to create that content and get it to them in digital format.

5. Internet Banner Advertising

Internet banner advertising has become a strong value proposition for marketers because of the availability of highly-targeted advertising networks that can place your ads on specific sites frequented by professionals in your industry. Online advertising networks also offer the convenience of reaching many sites with a single buy, helping you save time and make the most effective use of your budget. Banner ads are highly visual; they offer great branding opportunities and can drive qualified, targeted traffic to your website.

6. Testing and Analytics

One big advantage of digital media is that it is easy to test and measure. A/B testing is becoming a popular way to optimize email campaigns, web pages and other online media. A/B testing basically means you split your list in two and send each list a slightly different version of what you’re testing, changing only one thing at a time and measuring what performs better. In addition, every company should be performing some type of website analytics, such as measuring traffic, page popularity and visitor behavior, to help make informed decisions about optimizing its site.

7. Online Marketing Budgets

The top eight channels for increased marketing spend in 2011 are all online — from social media and SEO to internet banner advertising networks and online newsletter sponsorships and more. In addition, according to GlobalSpec’s 2011 Industrial Marketing Trends Survey, companies spend an average of 38 percent of their marketing budget online and 50 percent report that online marketing is a larger percentage of their overall marketing budget this year than last year. Online marketing should continue to take a bigger slice of the marketing budget in subsequent years, as more marketers experience the ROI associated with online programs and discover they can connect better with customers and prospects online.

ADOTAS

The new channels will be available to Burst’s ecosystem of independent publishers to complement their self-produced content. Covering genres such as from food, fashion, celebrity gossip and gardening, Burst’s channels feature content from blinkx direct-play partners such as Reuters, Howcast, CelebTV, GeoBeats and TVGuide. In addition, Burst has partnered with social media advertiser BlogFrog.

ADOTAS

VidLogic offers clients access to 95% of available online video inventory through partnerships with exchanges and networks as well as direct agreements with premium publishers. Through AdoTube’s video ad serving technology, clients can deploy proprietary AdoTube units such as Polite Pre-Roll, which accounts for 30% of the company’s served video ads. The unit allows viewers to skip in-stream video ads and had a view-through rate of 45%. Sweetening the pot for clients is the recently opened production arm, A20 Productions, for developing video ad creative.

In addition to AdoTube’s targeting technology — which includes demographic and zip-code-level geographic methods plus its Response-Based targeting tool that employs data garnered from advertiser-composed surveys aimed at target audiences – clients can integrate the plethora of third-party audience targeting services. Finally, AdoTube offers tracking across all inventory sources as well as cross-platform analytics (that can be broken down by ad unit) that measure reach and frequency across online video, mobile and connected devices.

“As an agency veteran, I saw an inherent need for a platform to simplify the extremely complex video advertising process,” said Brian Mandelbaum, AdoTube vice president of Platform Development & Strategy. “With VidLogic, we took it a step further by adding support for nearly all vendors and insights that brand advertisers were eagerly awaiting.”

In addition, the platform will support in-app advertising for television app developers through the LG SDK and YuMe’s Ace for Publishers platform. In addition, YuMe will also offer developers inventory management, monetization and optimization capabilities. App developers will have their pick of a variety of demand portals, including YuMe’s Connected Audience Network.

The platform is integrated into all LG Smart TV HDTVs, Blu-ray Disc™ players, Smart TV Upgraders and other LG Smart TV products. In addition to support for display banners, video banners and in-stream video ads, the platform will be capable of serving newer units that are search-related or feature click-to-application call to actions.

“Even as consumer attention fractures, we offer brands a way to seamlessly reach consumers at every stage of interaction with the TV, and across all platforms and devices; and as the interactive TV market grows we expect to be the leader in delivering relevant advertising to consumers,” said YuMe CEO Jayant Kadambi.

In November, LG and Yume will run pilot campaigns in the U.S. with charter advertiser Toyota Motors U.S.A. and other brands; broader rollout to advertisers is expected in spring 2012.

Trouble is, for a long time now, auto dealerships didn’t engage social media in that game-changing light. They focused only on themselves, concentrating their outreach on promoting inventory and generating leads.

This quickly proved ineffective. Dealers lost the few Twitter followers and Facebook friends they had out of disinterest; and once lost, most had no idea how to re-engage their followers.

But a new view of social media is finally emerging among dealers, one that is much more in sync with the reality of why individuals invest themselves in social media in the first place.  They’ve come to understand that social media outlets are not places to troll for leads. Instead, they are places to cement existing relationships and create trust and goodwill.

Put another way, don’t use your social media accounts to look for new customers; leverage it as a way to get closer to those who have recently purchased from you.  These folks have already made an investment in your business.  They’re open to new reasons to come back— for service, for advice, perhaps even an additional vehicle.

Video Steps In

To do all that, you need your Facebook page or Twitter account to be a valuable place your customers come to again and again. And that means offering content that not only deals in their interest, but also is appropriate coming from a dealership.

If people want to be entertained, for example, there is no shortage of Web sites that offer an amusing picture or funny story.  What they want from you is information and support that is commensurate with the very expensive purchase they made at your establishment.

This is where video comes in. Video has the power to convey information faster than any other form of communication. It can introduce your staff, it can inform, it can disarm.  In as little as 30 seconds it can show that you put your customers first—which is what people want most.

So what kinds of videos should you make?  Here are some ideas taken from actual dealer presentations:

• “Unknown” features of your new car that you won’t find in your owner’s manual
• How your car differs from those made five years ago—or even last year
• A short history of the dealership, told by the owner or general manager
• All the free things your dealership offers customers, from clinics and car washes to email service reminders

Don’t feel your social media videos have to be polished or glitzy. People want content, not production values. Short videos (2 minutes or less) that are worth your customers’ time will far outperform expensive, professionally produced mini-documentaries.

What is important, however, is the involvement of your senior staff.  Your customers want to know that you value their social media time. Pushing your social media assignments onto junior employees will give the impression you don’t care.  Get your managers involved—and even encourage them to generate ideas and post entries themselves.

Advanced Applications

Viewed in the context of a social media strategy designed to inform, adding a video-based inventory application to your Facebook page now becomes appropriate. The more advanced vendors in the space include this option as an add-on to their inventory video services.

Along with video, be sure that your entire vehicle inventory is represented with vehicle information and lead generation tools. You can actually have your vehicle video inventory available as a tab of your Facebook page—this will ensure that your vehicle lineup is effectively merchandised when your followers are ready to shop for a new vehicle.

The bottom line is, if you can get your existing customers to follow you in social media by dealing in their interest, you’ll be more top of mind than through any other channel. Nothing—not email, newsletters, direct mail, even TV advertising—has the power to engage like social media. Bringing video into your social media toolkit will improve your power to connect with your customers, and bring more business long-term.

Well, then there’s Jingit, which has just launched after doing its time in private beta. Users log in to the online platform or mobile app via their Facebook accounts, interact with advertisers by watching videos and answering questions or filling out surveys, and sit back as the cash rolls in.

Well, it’s not like dollar bills are going to pop out from your laptop’s cd drive (but wouldn’t that be cool?). Jingit has partnered with US Bank to set up online accounts for its users that have no monthly fees, but a “socially responsible fee structure”; in addition, deposits can only be made by Jingit.

After earning $2 by watching video ads or filling out surveys, users can apply to receive Visa Debit Cards linked to their accounts that can be used to purchase both online and offline. The maximum earning amount is $10 a week — apparently you can’t make millions viewing and interacting with ads.

Advertisers that have or are using the platform include T-Mobile, Sony, Gatorade, Oakley, Lifetime Fitness and Domino’s Pizza. Though the Jingit app asks for access to personal information from Facebook such as your email, its privacy policy ensures such data is used only within the site and not shared with advertisers. Advertiser targeting options are based on non-identifying segments such as age, gender and geolocation.

Also, anyone on Facebook can join, including teenaged minors (over the age of 13, if they’re not lying to Facebook) — Jingit features a “Message to Parents” on its website arguing its product is a tool for teaching “financial stewardship and responsibility.” The US Bank card is debit-only, with no line of credit.

According to co-CEO and cofounder Joe Rogness, Jingit’s online platform and mobile app are just the start: ”Right now we are seeding the network through a couple of publishers, and balancing scale between users, advertisers and publishers. Our vision and goal is to evolve further, enabling publishers to sell any good at any price and get paid instantly, while providing a simple and secure payment checkout for the consumer.”

Xaxis is offering four ad units that can be employed in campaigns separately or jointly: classic In-Stream Video with its various rolls; Dynamic Content Distribution, which enables the syndication of branded content; an Ad Selector unit allowing consumers to choose the ad or product they feel is most relevant; and Social Share Activator, a branded video player that shoots for social engagement.

On the analytics side, metrics from the video platform will not only show advertisers the direct effects of a video campaign, but also its “attribution halo” to campaigns running on other channels.

More than 20 publishers and networks have already been integrated into the platfrom, including Sony Pictures Television, Auditude, Digital Broadcasting Group, Tidal TV and WPP’s own 24/7 Real Media.

“For the first time ever, we’re allowing advertisers to realize the same brand value that they get from a television campaign in the online video space,” explained Xaxis CEO Brian Lesser. “By aggregating and standardizing the broadest range of high quality online video properties within a single, comprehensive platform, we offer brands the ability to design and run online video campaigns with the same type of consistency and precision that they use for their television ads.”

I couldn’t even make it through David Lean’s “classic” film adaption of “Great Expectations,” but I could swallow one of those little yellow volumes and half-ass my way through an essay exam. (I made up for that C with a scholarly tome on “Lord Jim” by Joseph Conrad, which is difficult to read but well worth the effort.)

So I find the announcement of CliffsNotes Films, one of 15 new web series that AOL introduced today at Ad Week NYC, kind of disheartening from a book lover’s standpoint, but pretty cool from a marketing one. Brought to you by Mark “Survivor” Burnett, Coalition Films, Josh Faure-Brac and AOL Studios, CliffNotes Films reduce literary classics to animated shorts, hopefully with the same insight the little yellow books offer.

For advertisers, it’s a great way to target teenagers suffering through Victorian literature — the first six episodes in the series (all Shakespeare plays) are sponsored by “Anonymous,” Hollywood’s pot-boiler take (directed by “2012″ and “Independence Day” auteur Roland Emmerich) on the controversy concerning whether William Shakespeare really authored all those majestic works. That matchup seems appropriate on many levels, now that I think about it.

Though AOL’s new online video series, which will be distributed across the AOL Huffington Post Media Group network of sites, run the gamut in terms of genres and intended audience, most of the high-profile content is aimed at women. Top of the list has to be fashion model Heidi Klum’s show dedicated to fabulous living (I’m more interested in “Absolutely Fabulous” living myself), which should be prime fodder for advertising to women (and likely gay men). “A Supermodel Stole My Husband” features women enlisting supermodels to give their spouses makeovers, while “Little Women, Big Cars” is a scripted dramedy starring Ed Begley Jr., Antonio Sabato, Jr., Julie Warner and Kristy Swanson (the original Buffy!).

And the suddenly omnipresent Jennifer Lopez is involved, with her Nuyorican Productions producing “Lost in Translation” (no relation to the film) in which hip-hop DJ Angie Martinez explores her Puerto Rican heritage through cooking and learning Spanish.

AOL is also celebrating the stats on some of its current video series — the portal announced the regularly updated “You’ve Got” series of one-minute videos on anything and everything has accumulated 100 million views. In addition, recently relaunched live-music series “Sessions” garnered 3 million views in August, more than 200% better than the year before.

According to the comScore Video Metrix, AOL Video brought in 44 million U.S. uniques in August who streamed more than 400 million videos. That’s far behind Google and its YouTube dominance, but it’s on the heels of chief portal rival Yahoo!, which registered 45 million U.S. uniques over the same period.

Finally, AOL has partnered with digital agency VivaKi and its Pool research arm to develop more engaging video ad models. In particular, the partnership will build on the success of VivaKi’s ASq model, which gives users multiple-choice options for which pre-roll they watch. During three rounds of research (or “lanes” — get it?), the Pool recorded ASq as online video ad model numero uno as it impressively out-performed boring old pre-rolls. It’s a smart move for AOL, which has received good reactions to its seemingly counter-intuitive Project Devil ad unit.

In general, I think this is the most impressive online video upfront I’ve seen since the term became commonly used two years ago. The big names have showed up in terms of on-camera talent, producers and even legacy brands (who under the age of 50 doesn’t know what CliffsNotes are?). AOL/Huffpo is looking like the premier stop for premium, original video content — let’s see if consumer and advertisers agree.