The Transformation of Online Video Advertising

The introduction of video ads in the nascent era of digital advertising was met with a great deal of experimentation. Replicating television commercials on websites, brands sought to capture online audiences. This pioneering phase was characterized by trial and error as both advertisers and publishers navigated the largely uncharted territory of online video content.

Advancements and Challenges

Fueled by faster internet speeds and advancements in streaming technology, video ads swiftly became increasingly sophisticated. Targeted messaging allowed advertisers to reach specific demographics, leading to the widespread adoption of the pre-roll, mid-roll, and post-roll formats. These seamlessly integrated with video content to offer a more cohesive viewing experience. However, with progress a new set of challenges emerged, including high-value ads appearing in suboptimal placements, resulting in user frustration and wasted advertising budgets.

The Need for Standardization

As digital advertising matured, so did its complexities. The introduction of out-stream ads - video ads playing independently from video content, often within articles or non-video environments - presented new opportunities while also creating confusion. Advertisers struggled to grasp the true worth of their ad placements, and publishers faced difficulties in accurately categorizing and pricing their inventory.

The IAB Steps In To Foster Transparency

Recognizing the need for a more structured approach, the Interactive Advertising Bureau (IAB) intervened to bring order to the evolving landscape. The IAB's initial guidelines provided a framework, but with continuous advancements in technology and user behavior, a more refined system became necessary. At the core of this issue, advertisers were not getting real value. Imagine paying a premium for a prime-time ad spot in a video, only to have it show up next to the video instead. Publishers also needed a clearer picture.

The IAB’s latest update now ensures that advertisers are getting the true value for their ad purchase, because they know exactly what they are paying for – a pre-roll before the video, a mid-roll in the middle, or something else entirely. Additionally, with more precise definitions, publishers can now confidently categorize their ad placements and charge the right rates. No more accidentally giving away high-value ad space for cheap. 

What Has Changed? 

Previously, video ads were primarily categorized as in-stream or out-stream. In-stream ads played within existing content (pre-roll, mid-roll, post-roll), while out-stream ads existed independently (video ad that appear within an article or not a video environment. The new system adds more nuance: 

• In-stream: This still refers to ads within a video player, but with a crucial new addition: Sound must be "on" by default or have explicitly clear user intent to watch the video content on the likes of Shahid, Viu, Awaan, Zee5 and IQIYI (basically across all VOD platforms, including YouTube & Dailymotion) on-site.
• Accompanying Content: These appear before, during, or even alongside other content being viewed (like articles or websites that are being browsed). Unlike instream ads, they might start playing automatically without sound, so users would not even realize that an ad is playing at first. On Dailymotion offsite, Kooora, Jamalouki etc, these may convert to a floating / sticky player as they scroll off the page. 
• No Content / Standalone: Imagine opening a video player, but instead of your favorite show, all you see is an ad playing. This type of standalone ad is essentially a video player dedicated solely to displaying ads and not any other kind of content.
• Interstitial Ads: These are the most in-your-face video ads. They are full-screen video ads that appear in-between page navigation and take over your entire screen, whether you are browsing a website or using an app. They also tend to be very noticeable.

The Impact on Publishers: 

• Inventory Reclassification: A sizable portion of previously classified in-stream inventory might not meet the new criteria. Publishers will need to re-evaluate their ad placements. 
• Monetization Strategies: Understanding the new categories can help publishers optimize ad placements for the most relevant and valuable ad formats.

The Impact on Advertisers: 

• Targeting: Advertisers place their message in environments where viewers are more receptive.
• Measurement: Clearer classifications should lead to more accurate advertising measurement and campaign performance evaluation.

What does this mean for DMS Video? 

• Clearer Communication & Streamlined operations: The new definitions provide a standardized language for the industry. This allows us to confidently highlight our VOD in-stream and accompanying placements to potential advertisers, eliminating any confusion and ensuring that our advertising partners understand exactly what they are getting.
• Premium Value Proposition: In-stream with sound-on makes for a more impactful ad experience, potentially fetching higher CPMs for VOD placements. The new accompanying content video allows advertisers to creatively integrate their message alongside content, further boosting the value proposition.
• Granular Targeting: Advertisers can now target campaigns specifically towards viewers who engage with VOD content and are receptive to in-stream and accompanying video formats. This enables us to connect advertisers with highly relevant audiences, potentially increasing ad fill rates and revenue.
• Data & Measurement: Standardized definitions facilitate consistent data collection and measurement across the industry. This allows us to highlight the effectiveness of VOD placements to advertisers with clear metrics, potentially attracting repeat business.
• VTR (Video Through Rate) and Completion Rate: These no longer serve as the sole metrics. Advanced measurements such as “Attention” or “Engagement” are being adopted as the main factors to look at.

Overall, the new IAB definitions strengthen DMS Video as a leader in offering premium ad experiences. By leveraging these updates, our advertising partners can attract high-value audiences, improve targeting efficiency, and ultimately, reach real engaged people.  

The Final Cut 

The current focus on audio presence in video ads presents a limited perspective. The true value lies in a comprehensive approach to video integration, considering numerous factors that impact the user experience. Focusing on sound creates a distraction from the core issue: creating sustainable value for users. This translates to video ads that align with user behavior, device type, and personal preferences. Users desire creative, clear, and inspiring video content, while advertisers seek optimal reach and campaign goals.

The IAB's new video ad classification system brings more structure to the digital advertising landscape. While some initial adjustments are required, it benefits both publishers and advertisers by promoting transparency, better measurement, and potentially more engaging ad experiences and opening doors for better attention measurement.  

- By Ramy El Kassis, Business Director - DMS