Wal-Mart's approach to selling CDs draws from the theory that advertising should be based on a person's interests; video advertisers take note.

Advertisers, publishers and vendors need to know their audiences, not only as a means of finding them online, but more importantly, so they can speak to them with the right ad products.

The Wal-Mart example
Recently, a colleague was telling me how a few years ago, Wal-Mart installed machines in all their music departments that allowed customers to listen to the CDs they were interested in before making a purchase.

Customers needed merely to bring the CD to the machine, put on the attached headphones, scan the CD and listen to whatever tracks they chose.

As a consultant for Wal-Mart at the time, my colleague asked an executive why, if all the CDs were already in their database and accessible by search, the machines required users to actually scan the CDs.

"Wouldn't it make sense to have all the CDs available through the touchscreen?"

"Nope. Once those CDs are in our customers' hands," said the Wal-Mart executive, "they're half-way to the cart. This system helps get the CDs in their hands."

Wal-Mart, or at least the inventor of those machines, knew how to interact with people. When it comes to online video, we too need to know people.

The video application
Presently, ad products like pre-roll and mid-roll are center stage in discussions of online video advertising. They're based on the proven TV commercial model, which make sense because users would rather sit through a commercial than pay for content and for the most part, they actually work.

The truth is, when executed properly and judged against metrics like clickthrough and view through, they work really well.

Unfortunately though, like TV commercials, the audience hates encountering them. People just aren't grateful when a brand interrupts their video experience and delays them from seeing the content they want. This is especially true in today's video economy where most clips are 2-3 minutes long.

These ad products, while performing well by today's standards, are not long for this world. Like the Wal-Mart CD-preview machine, the video ad products that are going to work better for advertisers are those that are less intrusive and invite interaction to help users learn more about products or brands they show interest in.

Obviously, unlike Wal-Mart shoppers, online users aren't in a physical store, so advertisers need to reach their audience as they engage with the video content important to them. This means targeting by as many parameters as possible (geo, context, behavioral, etc.) From there, marketers need to advertise around the video content with features that help users form an opinion or make a purchase decision.

Advertising that can exist around the video experience (without automatically interrupting it) includes scrolling text, overlays and bottom thirds. These ad products tastefully exist on the screen without stopping or prohibiting the playback experience. What's more, they can include robust opt-in features to entice users to interact with them and take further steps.

As always, these ad products can promote clicking through to an advertiser's page, but more importantly, the interactive features, which exist within the video player itself, "on top of" the video content, can allow users to watch commercials, download brochures or coupons, watch extended trailers or additional video, find retail locations or in some cases, make direct points of sale. The list of promotional functionalities is near limitless.

These overlays allow advertisers to quickly and tactfully reach users who are engrossed in relevant video content. And, as long-form video hits the market and the industry of digital distribution really begins to scale, ads such as these, which rely on time-based deployment, will help publishers monetize their content more effectively without annoying users via hard stops in the content.

We always need to remember that the products, services and brands we promote are being pushed to real people, and to reach these people most effectively, we need to understand their habits. In the case of online video, people don't want to be interrupted, and if we think we can teach them to get used to the idea of extended commercial breaks, we're wrong. Ad skipping technology is already cropping up!

In the coming months, look for more video ad products and features that promote voluntary brand interaction around video, because advertisers who strategically combine targeting and relevant video ad solutions will be able to put the right information in their prospective customer's hands. And once that info is in their hands…it's already half way to the cart.

Bradley Werner is the director of marketing for The Fifth Network. Read full bio.