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This article was published on February 26, 2014

How we can fix online video advertising’s weakest links

How we can fix online video advertising’s weakest links
Yuval Brener
Story by

Yuval Brener

Yuval Brener is CEO of , an interactive video enrichment platform. Yuval Brener is CEO of , an interactive video enrichment platform.

Yuval Brener is CEO of, an interactive video enrichment platform.

No matter how you look at it – bandwidth consumption, number of viewers per hour, virality – online video has taken over the Web. ComScore states that 89 million people in the United States are going to watch 1.2 billion online videos before the day ends!

Over six billion hours of video are watched each month on YouTube alone. That is nearly an hour of video for every person on the planet. Five Vines are tweeted every second – humans breathe less than that.

Naturally, the cash follows and online video advertising became the fastest growing segment in the advertising world, doubling every two years. Still, it’s far from fulfilling its potential.

Shifting online display and search budgets towards online video is a major part of this astounding growth, but the market’s real upside is offline budgets. Moving dollars from offline to online is a painful and slow process. It must overcome broadcaster interests, ingrained buyers’ habits and people’s fear of change… but if anyone can do it, it’s online video.

Regardless of its sources, this kind of growth is great news for the entire online video ecosystem, including owners, publishers, advertisers and video related startups. However, it’s also the industry’s weakest link is it is the slowest to evolve.

A revolution! Or was it?

On the content side, the revolution is peeking. Original online content has taken the major steps towards TV standards in terms of production level, content formats, resolution standards, and even media buying methods.

AOL, Yahoo, YouTube, Netflix, and others have all professionally produced content according to its users’ tastes, pushing user generated content aside.

A similar revolution is occurring on the distribution side, both for users – who are now surrounded by countless screens that make videos more accessible than ever – as well as for content owners who are now syndicating their content in order to reach their audiences and stand out in this highly fragmented market.

Soon enough, offline videos will be extinct and the revolution will enter the next stage, revealing online video’s hidden potential: Interactivity.

The “1.0 monolog” experience didn’t survive in any other area of the online arena, and there’s no reason for video viewing to be the first one to do so.

The desire for interactivity is nothing new. It’s almost an obvious thing for both users and advertisers, especially within video content. Thus, why haven’t interactive videos found their place yet in the daily use?

Interactivity or nothing at all

In order for interactive videos to become an integral part of the everyday viewing experience they must consist of four aspects:

  1. Real value for the user.
  2. Experience that blends intelligently with the video viewing experience.
  3. Native Ad units.
  4. Created automatically.

If content is still king, then scale has got to be the queen – and we all know who is running the show at the palace. Automated interactivity that captures three of the other criterias is hardly a walk in the park. It’s a challenge. Unfortunately, there can’t be any shortcuts here.

If it doesn’t scale, it’s not interesting.

Meanwhile, in the advertising space…

The market is moving forward in terms of matrices – shifting from CTRs and CPMs to Cost Per Engagement and Cost Per View. In terms of technology and in the way media is being bought, however, the dominant inner-video ad formats are the same: A standalone pre-roll.

Using the offline approach (a 15/30 second spot) for the online arena was the obvious thing to do in the industry’s early days, mainly because advertisers understood it.

Not anymore.

Yahoo’s Marissa Mayer’s important announcement about cutting all of Yahoo’s mobile display ads in favor of native formats was the official tipping point for those who needed one. The evolution has (finally) found its way in the advertising space.

The future

In 2014 and beyond, inner-video advertising should be about branded content (as AOL is doing with “BeOn“). It should be about “Pull, Not Push” advertising (YouTube is half way there with the “polite/skippable Pre-Roll”), about multiple touching points with viewers across ad formats, and it must be about proximity to content.

Advertising’s deepest weakness is the distance between the viewing experience and the content experience. Bringing the two closer together through real native advertising is the key to better campaign results.

The content is finally great, the audience is already here.

2014 might just be the year in which online video advertising evolves into what it should have been from the very beginning.

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