Mobile digital video advertising is the future

A s we all have been reading, online video consumption growth rates have soared over the past year especially due to broadband growth and penetration. As a result, video sharing and video search website have realize a much stronger traffic scenario whereby advertisers and marketers are spending and are poised to spend just short of $1billion in online video advertising this year.
 Because of the keen interest of the advertisers towards the online video segment, many video sharing sites have been encouraged to come up with different formats for the placement of video advertisements. Oleksiy Nesterenko Startup Finance has analysed that the quantum of investment in this segment has fuelled innovation of the methods in which video sites are deploying online video monetization and advertising programs. Oleksiy Nesterenko found that in-stream (pre-roll, mid-roll, post-roll) advertisement formats have been in existence longest and have produced a good share of revenue for online video content producers.

Pre-Roll Ads — In this format of advertising, the advertisement clip is inserted before the actual video and while playing the video, the advertisement clip is played first and the viewer is compelled to watch the advertisement before the start of the real video file.

Post-roll Format — In post-roll, just like the other in-stream ad formats, a short clip is played and streamed within the player at the end of the video stream itself. This is not as desired by advertisers as they know that many users never watch a video all the way until the end.

Mid-Roll Ads — This advertising format is where the clips are included in the middle of the videos so that the viewer goes through the video advertisement if he is curious enough to see the remaining part of the video, this format is also very popular with many of the video sites.

Some of the video sites have started experimenting with different formats like, in-player banners: In-player ads sometimes include relevant text or image advertisements in the space available in video player between the outer margin of the video and the inner margin of the video player.

Video is quickly becoming the dominant medium of the Smartphone era.

According to the recent study by BI intelligence, US digital-video advertising revenue from mobile-based video ads will top over $1.2 billion this year, equalling ca. 25% of the total video advertising revenue. That figure is expected to grow at a five-year compound annual growth rate (CAGR) of nearly 40%, reaching $6.5 billion in year 2020 (or ca. 49% of total video advertising revenue).

Overall surge in digital-video advertising is driven by the simple fact that video ads are more effective than standard display ad units. Google’s Rich Media Gallery estimated that in-stream video ads (including ads that play at the start, during, and after video content) yielded click-through rates that were 18x higher than HTML5 banner ad units.

Social-networking sites are best positioned to be the biggest gainers of this trend, as they already have huge built-in mobile audiences, advanced targeting, and native-style ad units.

About the Author

Oleksiy Nesterenko is a seasoned finance and business development professional, offering over 9 years of experience across multiple areas of business including financial planning and analysis, capital raising, corporate finance, business strategy development, and M&A.

Contact him at (310) 710 4248 or mail at for the needed financial and strategic insight which will enable your businesses to thrive.
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