John Lewis, the UK department store, launched its traditional blockbuster Christmas ad yesterday, but new research from America suggests the quality of video ads is more important than budget, especially for small and medium-sized businesses.

Wistia, a video tech firm based in Cambridge, Massachusetts, worked with Californian video production agency Sandwich Video to create three video ads, each with a different budget, to measure which performed the best.

One was created on a shoestring budget of just $1,000, the second with a more generous budget of $10,000, while the third was assigned a budget of $100,000.

Called “One Ten One Hundred”, the research project found that the $10k video ad performed twice as well across all platforms compared with the other two.

In addition, the $10k ad achieved nearly half the cost per install (CPI), averaging $6.66 on YouTube compared with $10.75 CPI for the $100k video ad and $12.74 for the $1k ad.

There was an even greater difference on Facebook where the CPI for the $10k ad was $23.57 compared with $77.54 for the $100k ad and $54.04 for the $1k ad.

The $10k ad also performed at least as well as the others when it came to cost per view on both YouTube and Facebook.

Average cost per view was about the same ($0.08) on YouTube, but when it came to Facebook, the cost per view of the $10k ad was $0.10 compared with $0.18 for the $100k ad and £0.14 for the $1K ad.

Chris Savage, founder and CEO of Wistia, claimed the research adds clarity for businesses about what is achievable across a variety of budgets and shows that video advertising is now within reach for most small businesses.

“For us, the $10K video ad was the overall best performer. If you look at a lot of the feedback, it really struck the right balance for us between professionalism and authenticity,” he said.

“That said, the $1k ad performed just as well as the $100k ad, and this demonstrates that with the right idea and narrative you can get as much out of $1k as $100k.”

Accompanying the Wistia research is a documentary showing how the three video ads were created.

Sourced from Wistia; additional content by WARC staff