Programmatic video ads have seen massive growth in recent years, and this growth is fuelled by one factor, which is “People love videos.”
Nearly 250 million people in the U.S. enjoy and prefer video content. This truth can’t be denied and is why global video ad spending stays at $60 million now. Technological advancements in programmatic video ads further aided publishers in redefining the publishing scene.
Seeing these eye-catching numbers makes anyone want to implement video ads on their website. I am sure that you want it too.
So, to give you a heads-up, this post explores the different dimensions of programmatic video advertising, its efficiencies, challenges, and trending topics in a new light. Let’s get started.
Table of Contents
Programmatic Video Advertising: Height of Efficiency
Programmatic video advertising is the optimal product of video combined with the efficiency and precision of programmatic media buying. This allows publishers to deliver the optimal mix of compelling content and engaging ads to the right audience at the right time.
Programmatic makes the video ads less interruptive, hooks up the users for a long time, generates high revenue, and is highly efficient.
Efficiency of Programmatic Video Ads
Innovation and strategy:
Video advertising is a place of new strategies that give monumental progress for the parties concerned: publishers and advertisers.
Implementation of these ads demands the use of different technologies:
- Video compressors like GIF compressors and MP4 compressors enhance the quality and speed of the video
- Big data analytics for performance tracking and draw insight out of ad campaigns
- AI video avatar to engage users with interactive elements.
Using different technologies enhances video ads and paves the way for targeting and customization to give a more personalized experience for users.
Implementing programmatic video ads helps publishers reach a highly targeted audience with data analytics and predictive modeling and brings high CPM (cost-per-mille).
*CPM is the revenue model of programmatic advertising where the publisher gets paid for every thousand views the ad gets. *
Data analytics: Data analytics is the process of categorizing audiences based on their characteristics, such as their online behavior, demographics, interests, and more. By segmenting the user into different categories, publishers can provide more detailed information about their users, which attracts multiple demands and intensifies competition.
For instance, a publisher with enriched data about car fascinators can attract multiple automotive brands and increase the CPM value.
Predictive modeling: This concept leverages the analyzed data to predict future behavior patterns or trends. Publishers such as Hulu and Vice Media redefined their targeting with predictive strategies and ended up with more effective ad campaigns.
Personalization at scale:
Another advantage of programmatic video ads is that they can be personalized to massive scale and different audience groups.
By utilizing AI and machine learning, programmatic platforms like SpotX and TubeMogul create highly targeted ads that resonate with individual’s interests and reach a wider audience. This personalization process ensures a better viewing experience and smart ad spending.
These are all the advantages of programmatic video ads contributing to the efficiency hike. However, reaching efficiency is not easy unless you know the challenges coming along.
Reaching Efficiency: Not Possible Without Challenges
Programmatic video advertising is beneficial, but at the same time, it has its fair share of challenges to tackle. Here are a few main challenges.
Transparency and ad fraud:
Transparency: Although video ads have been here for several years, they are relatively new, and the process is less transparent to publishers and advertisers. There are a lot of intermediaries between concerned parties like SSP, DSP, ad exchange, ad network, DMP, and ad servers.
The system of video ad serving is complicated; neither advertisers nor publishers can track how their money is shared among each platform and how much is reaching customers.
Ad fraud: Ad fraud happens on both sides. The publisher might get a bid from fake brands and receive poor-quality creative ads that mislead users to harmful websites. On the other hand, advertisers might attracted by poor websites that get clicks and impressions from bot traffic and might scammed to buy the ad space that doesn’t exist on the website.
These are common challenges in using programmatic video ads, but you can overcome them with the simple solutions listed here.
- Ads.txt: An initiative that allows publishers to show advertisers that they are authorized to sell ad inventories.
- Blockchain-based ad chain: Blockchain is popular for its decentralized network and transparency. The ad supply chain can use this to provide accountability and traceability and enhance the security in the process.
- Private marketplace: Utilizing programmatic direct deals in a reliable network like Google assures brand safety and high value for premium inventories.
Implementing video ads is not as easy as implementing display ads; many technical parameters need to be taken care of, like selecting a reliable video player, connecting with the best video SSPs, and embedding video ad units in the correct size.
You might also have to optimize page loading time so as not to hurt UX. The list goes on, and these factors should be considered to achieve efficiency.
To keep all these factors in check and leverage the potential of digital advertising, publishers and advertisers must handle the infrastructure equipped with complex systems and toolsets, which is extremely challenging.
This necessity increased the demand for diverse systems for seamless data transfer, analytics, and tracking mechanisms.
Masterstroke solution: utilizing the power of standard protocols
The best solution to this challenge is utilizing the power of standardized industry protocols and frameworks. This means creating a common operational procedure for video ad implementation and serving, widely accepted across industries.
The protocols act as a facilitator between different systems and ensure seamless interoperability among different intermediaries in the ad chain. An example of such framing is the Interactive Advertising Bureau (IAB) OpenRTB standard.
OpenRTB is a technology that facilitates real-time bidding. It puts all the programmatic parts, such as publishers, advertisers, and ad exchanges, in one page and language to facilitate a seamless auction process.
It removes the complexities in ad transactions and smoothens the entire process. The auction process is extremely fast in OpenRTB and transparent because publishers know who is buying, which ad unit they are buying, and at what price.
Benefits of harnessing industry standards:
Utilizing industry standards bears a lot of benefits, and it reflects mainly in ad revenue for publishers and high ROI for advertisers.
- Enhanced coordination among the programmatic platforms results in better data sharing, in-depth analysis, and reliable communication.
- Introducing regulations smoothens the media buying and selling process and fosters the organized ecosystem, where many platforms work together in unison. Thereby increasing the profit margin.
- It reduces errors, redundancies, and discrepancies in the ecosystem, paving the way for an accurate and streamlined advertising process.
What Does the Future Hold? Trends and Technologies
The growth of programmatic video advertising is unstoppable with emerging trends and technologies. Here, we have covered a few.
Mobile and Connected TV:
As Connected TV and mobile device usage rises, we can expect increased ad spending on these platforms. Connected TV encompasses any TV connected to the internet and serving people with online video content. Advertisers use this to reach people on a big screen with addressable ads.
Roku and Samsung Ads are the early leaders in Connected TV adoption. The shift towards multi-screen strategies is a reliable trend that every publisher should embrace to change their monetizing game.
Advancements in AI:
Programmatic is an automated way of buying media, and AI is the king of automation.
AI plays a major role in automating and optimizing video advertising strategies like enhanced machine learning algorithms for granular audience segmentation, enhanced bidding systems for real-time auctions, and innovative predictive analytics platforms like Albert.ai and AppNexus.
These will all shape the future of programmatic video advertising, and it should be on the bucket list of marketers to adapt to the changing ecosystem and keep the revenue flowing.
Embracing Video Future
Programmatic video advertising is evolving rapidly with its benefits and associated challenges. Publishers and advertisers must adopt innovative advertising approaches, have a head-on on challenges, and stay updated with emerging trends and technologies to keep pace.
As publishers adapt, they can unlock new revenue opportunities, elevate the audience relationship, and improve profit margins. Also, it will make them stand out from the crowd.