Table of Contents
Brands, marketers, agencies and adtech vendors--collectively the demand side--have all clamored for more premium in-stream ad inventory, and in 2015 the supply side is unlocking some 296 billion avails, though ad op growing pains persist.
Media execs too, for their part, are determined that IP premium television be monetized in similar fashion to linear clock counterparts across all platforms, further contributing to unit volume increases (in-stream formats), exhibiting a CAGR of 47.3% 2003 – 2014.
Despite pain points, spend is forecast at $4.8 billion (U.S. in-stream only) during the calendar year, with internet pure plays owning 56% of the market, broadcasters/cable programmers 36.5%, aggregation platforms 6% and print/magazine publishers 1.4%.
However, throwing an IP video ad across today’s diverse assortment devices of and media environments (i.e. Live to VOD) is complex and viewers are increasingly unforgiving.
Integration of linear and on-demand systems inside the organization is still early stage: linear and on-demand content management groups are just beginning to work in tandem to bring a unified workflow process to cross-channel monetization.
Ongoing digital video advertising playback and performance research conducted through AvailPlay Video Monitoring Services by AccuStream Research, with latest results and analysis contained in the industry trade resource In-Stream Video Advertising 101: Inventory Abundance, Execution Headaches, indicates better integrated workflow is necessary to create a unified, seamless content/advertising output that delivers a satisfying audience viewing experience on par with TV.
As demand has spiked, the fluid state of video ad technology adoption (i.e. make, buy, license or outsource) underscores the fact that monetization management systems deployed have often been pieced together over time, and while functional--if not optimal--may be deemed too expensive to upgrade or replace at this stage of the industry’s evolution.
“Frankenstein” digital video advertising technology workflow (ingest to multi-bitrate formatting, integration with multiple ad servers, video tech platforms and audience data warehouses) and various iterations of adtech media management deployments contribute to:
- Less audience patience with playback issues, higher content abandonment rates making fewer guaranteed impressions
- Impression fatigue: The same piece of creative running multiple times inside deployed ad pods populating a program
- Inexact audience forecasting tools which can alternatively underestimate or over-estimate inventory
- Ad units or executions (pods, apps, pre-roll or post-roll) that do not play, freeze, render properly, stuttering, halting or inconsistent playback
- Mobile/desktop ad calls that result in app freezing, device crashes or blank/black screens
- Site serving video creative across infrastructure not architected to handle the format
- Ad pods that may appear but are in some cases not sold/empty, alternately freezing when the creative isn’t there to play, turning into a black or blank screen
- Video ad playback breakage that does not properly failover to HTML5 encoded files
- Constant re-buffering
- VOD programming (authenticated through a set top box) is undersold, which leads to running repetitive creative, or impression fatigue
- Authenticated sign-in is still challenging, content is limited, very few programs are actually live, all operators are not supported, and video content/ad stitching is poorly integrated and playback is inconsistent
At this stage in the market’s evolution, the desktop remains the most exploited screen/platform, in aggregate. For example, YouTube desktop insertion frequencies averaged 27.6% over the past year, 60% TrueView enabled. Conversely, mobile/tablet insertion frequencies averaged 6.7%, with 77% TrueView units deployed.
This in-stream advertising resource provides detailed spend perspective: total views, sellout percent, CPMs, insertion frequencies by site (desktop, apps), UGC to premium broadcast sites, number of ad pods supporting Authenticated Sign-in, and units allocated inside those pods, playability, viewability, where frequency caps are enabled, where they aren’t.
The pre-roll/-in-stream video format is an essential monetization vehicle for premium cross-channel broadcast television, cable programming, large internet pure-play publishers and aggregators such as YouTube, Yahoo, NDN, Hulu, MSN/Microsoft, Crackle, large UGC outlets (i.e. DailyMotion) and smaller independent publishers and affiliated network sites.
3rd Party ad networks and clearing solutions (including public programmatic systems) are expected to manage 13.4% of total in-stream spend.
Additional market intelligence contained in this industry trade resource reveals in-stream video inventory is averaging an eCPM of $19.58, including YouTube.
Desktop sales generated $3 billion in spend, while non-desktop/devices/VOD sales totaled up $1 billion, capturing 25.8% of the market in 2014.
Excluding YouTube and Facebook, mobile/non-desktop video spend jumped 323.9% in 2014 to $719.8 million
A 30-minute show (i.e. 22 minutes as defined by a linear television clock) is monetized with 6 – 10 minutes of in-stream/online advertising time, broken up into 3 – 4 pods, each pod with 1 – 7 ad units/avails of varying spot length.
Turner Entertainment properties including TBS.com and TNT.tv, Discovery channels, NBC Universal, CBS and ABC are monetizing with in-stream ad loads at linear broadcast television levels. Long-form episodes typically see 3 – 7 ad pods, with 1 – 7 ads per pod.
YouTube leads all publishers with in-stream video ad billings. CBS.com, ComedyCentral.com, NBC.com, ABC.com ESPN.com are top performing in the premium broadcast/cross channel video publishing category.
For broadcasters, we estimate about 31.6% of total segment video ad spend was placed on screens other than the desktop in 2014.
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