Video advertising has become mainstream in recent years and continues to grow in popularity in the programmatic advertising ecosystem. Online video advertising offerings are expanding rapidly, with more than 90% of marketers believing that video ads are going to be the core of the majority of marketing strategies in the years to come.
Video advertising is the process of displaying ads either inside online video content — usually before, during, or after a video stream (known as pre-roll, mid-roll, and post-roll respectively), or as standalone ads. A majority of video ads are bought, sold, and displayed programmatically which makes up 75% of video ads today.
Programmatic video advertising spend was $28.4B in the United States in 2018, and it is expected to grow to over $40.44B this year. It’s no surprise that publishers want to implement video ad formats to their websites to take advantage of this.
What are the main types of video ad formats?
As a publisher, you can choose from multiple types of video ad formats to serve on your website. Here are the five main types of programmatic video ads available in 2021.
1. Outstream Video Ads
Not everyone is capable, or even willing, to produce their own video content for their website, and therefore lack the capacity to access the instream demand which would offer them top advertising revenue. This is where outstream video comes in.
Outstream video allows advertisers to place their video advertisements in display ad slots. Now, these ad placements don’t have quite the same engagement level that instream video slots have (and thus don’t command the same CPM value), but they’re still more valuable than your standard ad placement because of the ad’s integration with a publisher’s website.
This ad format blends into the editorial content, auto-playing as the user scrolls through. If the user is intrigued, they can click to play sound, click to be redirected to the ad’s landing page, or continue to scroll where the ad is automatically paused (the video only plays while in view). These ads work more in tandem with the content, without being disruptive. This gives the user the opportunity to choose to engage with the ad. In fact, eMarketer reported that 77% of agencies and 70% of advertisers prefer outstream ads to instream ads.
2. Instream Video Ads
Instream video ads capitalize on publishers who are making their own video content and want to stitch advertisements into the video — whether that is at the beginning (pre-roll), in the middle (mid-roll), or at the end of the video (post-roll). YouTube is a great example of instream ads — unless you’re paying for YouTube Premium, the video you’re watching will most likely have at least one instream video ad if the user has monetized their channel.
Videos are considered highly engaging content, with users having a high intent on watching them, so brands are willing to pay top dollar to have this captive audience. The downside of instream video is that you need to have and maintain your own video library in order to be able to run the ads. Their distinct advantage is that they are initiated by the user, which means higher viewability and CPMs.
Current advertising standards have marked mid-roll instream video advertising as too disruptive to the user. Depending on your ad monetization solution, they may only recommend and implement pre-roll instream video.
3. In-Banner Video Ads
In-banner video ads are earmarked as instream video and serve it within a standard banner size (e.g. 300×250), without expanding. In-banner video occurs when a publisher requests a display creative, and the buyer responds with a video creative. This lack of control does not appeal to many publishers.
Another downside to in-banner videos is the CPM is likely to remain the same as display when a video creative is served (and a fraudulent middleman may be pocketing the difference). The creative will be delivered with its own video player and video settings and it will be forced into whatever size is set for the display ad unit.
Some consider in-banner video ads as a type of fraud — advertisers are expecting to serve instream ads targeting users consuming video content, but instead their ads are displaying elsewhere. Historically, in-banner video ads have been associated with fraud and low quality ad issues for many publishers.
4. Interstitial Video Ads
Interstitial video ads, also known as floating or slider video ads, cover the entire or a portion of screen area, but are always on screen while displayed (i.e. cannot be scrolled out of view). Users can click the X in the top right corner of the ad (or outside the ad overlay) to close it and proceed to the webpage for which they’ve clicked a link. Interstitial ads do not involve a time component; users can click to dismiss the ad immediately.
The benefit of using interstitial video ads is the high CPMs associated with this ad format. Results vary (depending on publisher or domain) but interstitial ads as a significant revenue opportunity for publishers. It’s a high quality user experience that emphasizes user engagement, while providing a unique opportunity for advertisers to engage with users in a way that isn’t possible with traditional banner ads.
5. Sponsored Video
Sponsored video, exclusive to Freestar publishers, is an ad format that allows publishers to have access to instream demand, but with an outstream experience. As a publisher, you don’t need to create your own video content while running instream video ads using sponsored content provided by Freestar.
With this video ad format, you can demand top CPM dollars, and the videos are competing for placement in your existing ad slots. There’s no need to increase the ad density on your page.