Back in 1999, it was a painful experience to watch online videos, since they played at 15 frames per second. Nine years later, young companies like BrightRoll are not only supporting video ad campaigns worth $100,000, they’re releasing online commercials in HD format!
Underscoring the surge in online video ads, a new study released Tuesday by Strategy Analytics showed that more than $1 billion was spent globally on video commercials. Video commercials are also expected to grow at an annual rate of nearly 50% over the next five years, the report said.
As video ads surge, marketers – still not fully convinced of the branding effectiveness – are experimenting with in-banner units, but pre-rolls are the leading format. Sacerdoti said that these two units make up about 95% of the formats sold. Pre-roll still dominates and is an area that can see prices rise, he said. Pre-rolls are selling for between $10 and $25 per CPM (thousand impressions) on his network, he said. While the audience may not like pre-rolls, these ad units outperform any ad unit in duration, brand lift and click-through-rate, he said.
It’s not surprising that money is pouring online and in front of our little screens. The audience for video ads has reached critical mass as 80% of the online population will watch online videos each month, according to eMarketer.
Having done online videos since 1999, it seems like it’s taken forever for the ad market to catch up. Today, it’s just a matter of getting to some standard formats. Until that time, expect a lot of experimenting with video ad units, and get used to pre-rolls.