Video advertising will increase six times over by 2012

Internet traffic is set to increase six times by 2012 as more users view and post videos online, said Robert Pepper, vice president of Cisco, speaking at the Internet Governance Forum (IGF) in Egypt this week.

Pepper said the internet is growing at a compound annual growth rate of 46%, which is mainly driven by video.

Video overcomes barriers of language, local content and literacy, he said, allowing users to interact more easily with the internet.

Video advertising is set to be worth £245m in the next year and with the increasing popularity of smartphones, the medium is set to become even more attractive to marketers.

However, video ads on social networks and gaming environments do not perform as well as video ads that appear beside web content such as news, sports, music and finance information, according to a study by ad services firm Eyeblaster.

The study is based on the billions of ads it serves on behalf of brands. It claims social media ads do not have the same impact because users flit between pages on a network, rather than spending time consuming content. As a result, ads are not given time to make an impression on the user.

Eyeblaster is positive about the potential for video ads though, claiming the return on investment for video ads is double that of non-video rich-media advertising.

The study reveals that video advertising is 20% more effective than other forms of advertising.

Ads that are started by users rolling over banners are the most effective, followed by those which start without any prompting, according to the study. Ads which require a user to click to see a video are the least effective.