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Video Advertising 101: How Publishers Are Growing Revenue

While website visitors grow immune to display ads, video still has the power to capture the attention and imagination of audiences. Advertisers know this and are making a stronger investment in video to drive home lasting messaging—eMarketer predicts US digital video advertising to reach $53B by 2023 . And despite the rise of ad-free viewing options, video viewers are more accustomed to ad breaks (thanks to traditional TV), and the combo of audio and visual inputs leaves a stronger impression on a viewer, compared to display.

What does this all mean for Publishers? A massive opportunity to grow revenue, satisfy advertiser demand, and enrich the user experience. In this post, we’ll cover what publishers need to know to grow their video revenues.

In-stream vs. out-stream: Video ad placement


In-stream video ad

Similar to a commercial break, in-stream video ads are the most typical way of inserting ads (and is the format you most frequently see on YouTube). Ads are inserted at the beginning (pre-roll), middle (mid-roll), or end (post-roll) of a larger video stream.

The in-stream video is usually user-initiated—the user has to press the play button to start the video stream. Publishers may also choose to support skippable ads, where the user can skip past the ad after a short duration. At first, this may seem detrimental to video ad revenues, but these efforts create a more welcoming environment that keeps users engaged longer.

Out-stream video ad

Out-stream video ads are often used by text-based publishers that place standalone video ads within content feeds. These ads are referred to as out-stream because the ads are introduced outside of a larger video stream.

There are a few types of out-stream video ads:

  • In-Banner: video plays inside of a traditional display ad rendered on a website
  • In-Article: video ad is introduced between paragraphs of an article (as in the example image above)
  • In-Feed: video plays between posts in a feed like those for news and social media
  • Interstitial: video ad appears full-screen in an app (usually during a game break)

These ads are commonly set up to automatically play when in view (as a user scrolls through text or feed) and are typically set to mute by default to not interrupt the user experience.

How video impressions are sold

Video inventory is sold similar to display, with direct and programmatic options. For a full rundown on the differences, especially between the various programmatic deal types, check out our article, Programmatic Deal Types Explained.

The mechanics of the video experience


User Experience


    1. User arrives at a video on a publisher’s website.

Publisher Sell/Side

    2. An Online Video Player orchestrates the delivery of video content. The player fetches video and ad content from a local or third party source and renders the video playback (including user controls like play, pause, mute).
    3. The Publisher Ad Server receives the ad request from the player. The ad tag tells the publisher ad server to pull the creative from the advertiser ad server (if a direct-deal is in place) or to send the call to an ad exchange/SSP. The server also reports data about the event.
    4. An Ad Exchange/SSP is only involved in real time bidding (RTB) transactions. If an impression is sold via RTB, the SSP will receive information about the impression and make it available to advertisers that are connected via a DSP/bidder.

Advertiser Buy/Side

    5. DSP/Bidders are pieces of technology that advertisers and agencies use to place bids on inventory publishers have made available on an SSP. If an advertiser wins the auction, a call will be made to the advertiser’s ad server to send the creative to the publisher ad server.
    6. Advertiser Ad Servers store the actual video ad creative that will be rendered on the webpage. Advertisers usually produce multiple renditions of each video asset to accommodate different screen sizes and connection speeds. Advertiser ad servers receive ad requests, deliver the appropriate creative rendition to the page, and report data about the event.
    7. Advertisers traffic creative assets in the advertiser ad server.

User Experience

    8. Video player renders and plays video ad. Video player reports data on metrics.


Standard Formats Align Publishers & Advertisers


Although publishers are able to measure viewability by adding their own custom code to their online video players, standard video ad formats allow publishers and advertisers to agree on event definitions and measurements. Online video players fire advertiser-supplied tracking pixels when an engagement event happens and sends a notification to the advertiser’s measurement system. Using one of the following standards allows advertisers to independently verify reported numbers.

VAST: Video Ad Serving Template is a widely used standard format developed by the Interactive Advertising Bureau (IAB) for playing video ads. VAST files contain information about where to find various video renditions as well as instructions for how to load engagement tracking pixels.

Full documentation is available on IAB’s site.

VPAID: Video Player Ad-Serving Interface Definition. Also developed by the IAB, this technology supports interactive ads and custom tracking. When serving a video ad with VPAID, a wrapper (additional layer of code, usually Javascript) is required for measurement (viewability, fraud, audience verification). Though the VPAID format allows advertisers to deliver interactive ads, the additional complexity of producing the ads hinders advertisers from using this format. Additionally, publishers have found that the additional layer of code over the video player for measurement increases load time beyond what most site visitors will wait for.

What Metrics Matter?


Advertisers are even more interested in viewability and engagement metrics with video, in part, because the investment to create the ad and the opportunity for interaction is greater than with traditional display.

The most commonly tracked metrics are completed ad views, video viewership/quartile reporting, and events like play/pause, mute/unmute, and full screen expansion.

The Media Rating Council (MRC) defines viewable as 50% of pixels in view for at least 2 seconds. This can be limiting for some advertiser’s analysis, so the metric “quartile views” has been introduced to provide advertisers more granularity. As a publisher, you’ll want to make sure your ad server can accommodate any advertiser requests that are a part of the contract.

Seeking CPMs

Though display inventory vastly outnumbers video inventory, video spend accounts for almost half of digital display spend, according to eMarketer. Accordingly, video CPMs are anywhere from 3x to 10x higher than display, so optimizing for higher video CPMs will provide huge returns.

  • Drive traffic to your owned and operated properties from your social channels
  • Users may appreciate a less disruptive ad experience by adding a “click-to-play” feature
  • Set your player as the focal point of your page
  • Create engaging content—viewers will a compelling reason to sit through an ad break
  • Providing buyers with Deal ID and Placement ID helps with transparency—advertisers will be more willing to spend higher CPMs on identified inventory

Improving Pre-bid Targeting Ratings

Creating compelling content and engaging video experiences has a secondary positive effect for publishers: it improves a publisher’s ranking in pre-bid targeting. When purchasing inventory through a DSP, advertisers are able to rely on pre-bid viewability ratings for targeting and pricing. These ratings predict inventory quality based on historic viewability data for each publisher and placement and then allow a marketer to define rules for whether to bid based on predicted ad viewability.

Video Platforms/Players



Brightcove

Used by Vox, Meredith, Aljazeera, BBC Worldwide, and Gannett.



JW Player

Used by Insider Inc., Daily Mail, Hearst, BBC, FOX, Vice, and Univision.



Ooyala

Used by Telegraph, Mediacorp, BYUtv, and Media Prima.



Kaltura

Used by Telegraph, Mediacorp, BYUtv, and Media Prima.




This piece covers the basics of what you need to know to start earning revenue from your video inventory, but remember, this is only the beginning. As you fine tune your strategy, you’ll find more opportunities and options to tweak your sales operations, your tech stack, and measurement capabilities to grow your ad revenue and stand out from the competition.

Do you have any questions or want to discuss your strategy for monetizing video inventory? We’re happy to help, contact us here ›