ScanScout looks to target ads in video

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As online video becomes a more popular medium attracting consumer attention, new video advertising platform ScanScout has come on the scene offering to help marketers find new ways to serve on-demand ads alongside video content.

After a beta run of about six months, the company is set to officially launch the platform this week. User-generated site Blip.tv is one of the disclosed publishers on board. The company is reportedly in talks with some undisclosed major television networks.

"Online video is expected to grow 89 percent in 2007, and there are a number of challenges that advertisers face," said Doug McFarland, CEO of ScanScout, Cambridge, MA. "These include a lack of targeting, the disruption of pre- and post- roll and no brand protection. We aim to address these issues by serving up a platform that is targeted, non-disruptive and that protects the brand by carefully identifying the content."

ScanScout works like an AdSense for video. The software firm's platform uses technology to identify content through tag lines, video content and words spoken in the audio tracks of clips. It then serves up relevant ads in a small overlay corner of the video screen or alongside the video.

When an ad is clicked on, the video automatically pauses and serves the viewer an ad, be it a video ad or a direct link to a Web site. It can place multiple ads on a given video clip to match various topics covered in one clip.

Deep Focus is an interactive advertising agency that has partnered with ScanScout for its clients, which include HBO, Dewar's, Google and Nike.

"We as an agency are constantly looking for new ways to advertise within and surrounding video content other than the 15- or 30-second spot," said Ian Schafer, CEO/founder of Deep Focus, Brooklyn, NY. "The future of online video is on-demand rather than in disruptive model of pre-roll and post-roll. The fact that this is opt-in, and consumers are clicking through if they are interested, makes it really relevant."

The business model is a revenue share performance-based platform with a flat cost-per-click fee. In addition, the platform can be used in conjunction with other online video ads such as pre- and post-roll content.

"One of the biggest challenges in the space today is the sell-out of pre-roll," Mr. McFarland said. "We offer a new way to communicate with consumers, which is less limited."

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