Yaniv Axen Tue Aug 6, 2013

Recently, Mo Al Adham, CEO of Telly, wrote a VentureBeat article, “3 reasons why digital video needs to rethink its advertising model,” in which he argues that pre-roll ads have a “negative impact” on the advertised brand and that the “death of pre-roll video” is looming. I’d like to counter his perspective: pre-roll ads have the ability to positively impact customer-centric brands and drive customer engagement and acquisition strategies.

Adham is right about one thing; online video advertising is currently executed the wrong way, in which it follows TV’s model of delivering one ad to many viewers, ultimately annoying the consumer. I agree that the industry needs to innovate, but not at the expense of the pre-roll ad. Consumers want content and experiences that address their personal interests, ads they want to watch. Matching creative best practices from TV advertising with data-driven intelligence established in the display marketing space in recent years lies opportunity to deliver better, more personalized video ad experiences to consumers, even by pre-roll. While the ability to choose your own ad experience before a Hulu video starts is a small step toward a personalized experience, many brands are leveraging online video ad platforms to quickly move beyond just contextualized ads repurposed from TV. Think about it: if given the choice, would you choose a video ad for someone like you, or a video ad created in the moment just for you?

Brands recognize this, and are developing ways to influence online purchase decisions with SmartVideo technology, presenting viewers with a highly relevant and personalized experience – giving consumers what they want when they want it and avoiding the typical annoyance spawned by traditional pre-roll ads. With personalized pre-roll ads, brands combine the power of video advertising with the efficacy of on-site and engagement retargeting – such as purchase history or email campaign interaction – to recapture an otherwise lost investment. To retarget properly with pre-roll ads, the video content must be generated in real time and personalized based on segmented, persona, profile and behavioral attributes.

Consumers appreciate the personalized ad experience over a generic pre-roll ad, but businesses need more than that to prove their ad program’s worth. There are numerous ways to measure the impact of retargeted pre-roll video ads, such as evaluating the view rate, video ad completion rate, visitor return rate, surveys and hours of brand engagement. While brand impact and awareness is the common goal for online video programs, smarter, personalized video ads are also measured to be held accountable for direct marketing performance metrics, such as conversions, average order value, incremental revenue and return on ad spend (RoAS). In fact, retargeted pre-roll ads have proven to surpass display and other remarketing tactics. Visitors who are engaged with personally relevant ads visit the site, convert and spend up to 10 percent more than equivalent visitors who don’t receive these ads. Brands can use personalized retargeted pre-roll ads to not only bring back website abandoners but also to support strategic customer engagement and acquisition initiatives.

Contrary to Mr. Adham’s point that, “pre-roll ads are not well received by the viewer, which negatively impacts the advertiser,” leading customer-centric brands such as AT&T, Cars.comTripAdvisor and Cox Communications are turning to real-time, personalized pre-roll video ads to provide each customer or prospect with relevant information, leading to significantly higher conversion rates, RoAS, and a better viewing experience for the consumer.

What do you think? Do you anticipate the demise of the pre-roll ad like Mr. Adham, or are you optimistic and believe smarter video advertising means a better customer experience? Feel free to share your thoughts in the comments section below, and stay tuned tomorrow for part two: I’ll share five ways brands can use personalized pre-roll ads for a positive consumer experience.


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