YouTube is truly a juggernaut, one that is mentioned in the same breath as Facebook and Twitter as a platform that has defined and transformed our online experience. With 500 million unique monthly users and enough content uploaded every two months to cover the combined programming needs of the three major U.S. television networks over 60 years (Source: Mashable), YouTube has given voice to more individuals than any previous broadcast medium in history, and forever changed the way we watch videos.

Of course YouTube is not the only place to view videos online. Vimeo, Hulu, TubeMogul and others play key roles in enabling us to access, enjoy, and share this powerful medium. Yet video, for all its unique potential, has not been the kind of dominant force online that many expected. Nor has it been the top medium for brands to promote their products and services. A recent study by the University of Massachusetts Dartmouth Center for Marketing Research found that of all the major forms of social media, including blogs, podcasts, Facebook, Twitter, and message boards, online video was the only one whose use by Fortune 500 companies had actually decreased (from 36% to 33%) from 2009 to 2010; this in an age where other forms of social media are exploding in their use as promotional media by brands and agencies.

So why, of all social media, is video the one that is not keeping pace? To get to the bottom of this, and help brands figure out how to make the most of its incredible potential, we offer the following observations and some tips (in Part 2) on what makes a successful online video.

Online Engagement & the Great Viral Video
The first thing to recognize is that online video is completely different from its moving image predecessors, television and film. And just as adjustments needed to be made before television succeeded in reaching the kinds of audiences it now enjoys, we may need to learn a few more things before we figure out our ideal practices for online video.

One of the most profound differences between online video and television is access. Nowadays, the tools required to create and put a video online are available to millions of people all over the world. And while most of the videos online are nearly unwatchable, many of the most popular and successful ones are made by amateurs. So how does a brand or agency compete with a 56-second home video featuring a baby and a toddler and barely any dialogue? “Charlie bit my finger – again!” with over 300 million YouTube views, may prove to be The Great Train Robbery of its time.

What then is the “secret to success,” and what do brands and agencies need to know in order to make the best use of this medium? The mistake many people make is to think that because anyone can theoretically make a successful “Charlie” video that anyone will. What is undeniably true is that it is now possible to create compelling YouTube content for a fraction of the cost of a television commercial, which gives brands and individuals the freedom to try things out without nearly the same investment or risk they need to take to create a major ad campaign. The playing field is also more even, offering the potential for smaller brands and individuals to create content that could be seen by millions. But for every baby or cat video breakout on YouTube, there are millions more, whose views on YouTube top out in the low double digits and are never seen again.

thanks to Mike Axinn for these thoughts and stats!