Online Video Ads Catching Up to Online Video Views

Video advertising is finally catching up to consumer viewing habits.

That’s the finding of the latest quarterly report from video technology company FreeWheel, assessing both online video ads and video views.

Video ad views are rising at a faster rate than video views in the third quarter, marking the first time that ad views outpaced video views in growth rates, a promising sign for the online video ad economy.

Freewheel said the volume of videos views in its data set that reaches across clients including Turner, ESPN, FOX, Univision, Discovery Communications, VEVO and others increased from 6 billion a year ago to 11.8 billion, while video ad views grew from 3.1 billion to 7.2 billion during the same period. That’s a growth rate of 128% for video ad views, and 97% for video views, respectively. 

Videos longer than 20 minutes had the most video ads per video – about five on average in the third quarter, up from three in the second quarter. Long-form videos also have the highest ad completion rates, weighing in at 82%. The stability of completion rates for ads, even when the ad load rises, suggests that consumer tolerance for commercials in online video content is growing. While ad loads in online video aren’t close yet to ad loads in TV, the delta is narrowing, and that’s promising for networks eager to make more money with the migration to online video viewing.

"It shows that consumers have proven to content owners that they understand that to watch their favorite content for 'free' they need to watch ads - so those content owners are now increasing ad loads, approaching those of TV. The ad loads increasing from 3 to 5 in long-form video content supports this finding,” said JoAnna Abel, VP of Marketing for FreeWheel.

Freewheel also studied video consumption across various devices. The amount of video watched on Smartphones ticks up during the day, suggesting that consumers turn to their personal phones rather than work computers for video viewing. iPad viewing has a bump before work and during the evening, reaching its peak at 10:30 p.m., indicating that tablets are serving an in-home entertainment role. Similarly, consumers are watching a little less views on their iPhones and iPods.

Correction: Wednesday’s edition of “VidBlog” incorrectly attributed the deal between social TV companion app Umami and syndicated TV shows “Entertainment Tonight” and “The Insider” to CBS, which distributes the shows. The deal was made directly with the shows.

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