VentureBeat

Widget-maker RockYou is trying to get into the online video advertising business. It is now offering video ad placements within widgets and applications on social networks where advertisers can buy banner ads that users can “roll over” to reveal a video ad, like the one below for the Prius. Users can then share these ads with friends, causing the ad to also appear in the sender and recipients’ profiles and news feeds. This is the latest effort by the company to make money on social networks.

The Redwood City, Calif.-based company brought in well over $10 million in ad revenue last year through a variety of other ad formats, chief executive Lance Tokuda says (he won’t tell me exactly how much more).

RockYou is distributing the video ads to what it claims will be 130 million unique users of applications on Facebook, MySpace, hi5, Bebo and Friendster. Some of these users are on RockYou’s own applications (including 12 million users on media-sharing app Super Wall), while others are on independent partner apps that are part of RockYou’s ad network. All told, these users generate more than 20 billion pageviews a month; RockYou says its new video ads will be able to get up to 10 million video views a day as a result of its expanding reach.

Some of the video ad formats follow standards set by the Interactive Advertising Bureau, including its 350 x 250 ad unit. It’s clear RockYou wants to make social networking ads more palatable to mainstream advertisers. It is also integrating video ads with other offerings, like the ability for a brand or agency to buy all advertising space in a given app.

Video ads are part of its new focus on verticals, like the auto industry. For example, RockYou is planning to pitch in for the big launch of the new Ford Mustang model in March, including video ads in car-related apps within its ad network. It has also been testings ads with Toyota and General Motors. It has even been purchasing data from car sites and behavioral targeting companies to try to identify prospective buyers on Facebook and MySpace, according to AdWeek. RockYou believes it can do a uniquely good job of targeting car buyers when few are willing to spend based on its knowledge of users and their buying habits. This pits it against not only other app developers with a lot of traction (like Slide), but also social networks themselves, major portals like Yahoo, and, well, car sites.

RockYou plans to sell video ads for other verticals, like games, as well. As traditional video game developers introduce new products to social network users, RockYou plans to be in there to help them find prospective players, Tokuda says. So I asked him if he expected Facebook to start offering a competing ad network for apps, including a video-ad network. He replied that Facebook has so far concentrated on developing its own experimental ads, and hasn’t been focused on IAB standards or other features advertisers look for, like autoplay.

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