Online video ads--short-form commercials that run on Web sites--are proving to be one of the most effective ways to advertise online, with some video ads generating twice the clicks of banner ads. In fact, advertisers report planning to allocate about 35 percent of their budget on the ads by 2012, according to Borrell Associates.

Small businesses are catching on to this trend, fueled by a host of do-it-yourself Web sites that offer inexpensive, locally targeted, online video ad programs. Companies such as Jivox (www.jivox.com) allow advertisers to get started for as little as a few hundred dollars per campaign and make developing an online commercial simple and fun.

For example, Princess Port Bed and Breakfast in Half Moon Bay, California used Jivox to create an ad with free video footage showing a couple holding hands and walking on a beach, with a link to a coupon. After Princess Port ran the video ad, bookings skyrocketed, and 85 percent of new guests redeemed the coupon.

Here are a few things to keep in mind when it comes time to produce your own ad:

• Keep It Simple--Viewers don't want to read large volumes of text on their computer screen. To stand out, your ad needs to be short and sweet.

• Call Out The Benefits--Research shows that people decide if they want to read more about a topic on a Web site in eight seconds or less. Ads that contain specific, immediate benefits, such as a promotion or discount, can be highly effective.

• Be Smart About Type Size--Use no more than two type sizes in one ad, with the largest type size on top. Also, never use more than two fonts and avoid using all capital letters.

• Use Relevant Visuals--The visuals in a video ad should communicate a relevant message. Clean, simple graphics are more likely to catch the eye of the viewer.

• Test And Retest--Set aside a portion of your budget to test different approaches so that you can see how response rates fluctuate when you change the visuals, call-to-action or price points, or add a promotional offer.