• by Scott Jones , Op-Ed Contributor, May 6, 2015

If you’re a CPG marketer and you’re not yet leveraging digital video ads, it’s time to start. What makes digital video such a natural fit for CPG brands? CPG brands are already experienced TV advertisers. They are experts at using videos to tell great stories and make emotional connections with their audiences. So the leap from TV to digital video is actually a natural transition. Digital video advertising can also be closely coordinated with TV schedules so that multi-screen exposure can reinforce and enhance connections and messaging.

Additionally, Millennials are flocking to digital video. Have you ever watched a group of millennials research a topic? Instantly they are online, and most of their consumption is in the form of digital video. And when they more casually consume media, digital video is their go-to. It’s no surprise, then, that CPG marketers and agencies are following this ever-so-important segment by investing more and more advertising dollars in digital video. According to the IAB’s recent Digital Video Spend Study, 68% of marketers and agencies surveyed expect their digital video ad budgets to increase this year, with an average increase of 43% to $10.3M. If you’re not already an expert in digital video advertising, here’s a brief primer on the topic.

Ad Types 

There are currently two leading in-stream ad formats (played or viewed in a video player): 

• Linear video ads are presented before, in the middle of, or after the video content is consumed by the user. Similar to a TV commercial, linear video ads are watched in addition to the content as the ad takes over the full view of the video. Pre-rolls, interactive takeovers, and short bumper vignettes are examples of this format.

• Non-linear video ads run concurrently with the video content and are often delivered as text, graphical ads, or as video overlays. Overlays, product placements, and companion ads (commonly text display ads, or skins that wrap around the video experience) are examples of this format.

Venues

Like other digital advertising, digital video advertising can be split into both premium and remnant (non-premium) placements. Premium venues provide more control and context, but come at a higher price, whereas remnant venues provide ‘tonnage’ with discounted terms, but lack targeting and control. Some leading options to consider include:

• Yahoo, delivered via Brightroll
• Google, delivered via YouTube and mDialog
• Aol, delivered via AdapTv
• Facebook, delivered via LiveRail
• Comcast, delivered via FreeWheel

Pricing

Dominated by traditional CPM pricing, in both programmatic and negotiated forms, digital video ads can also be purchased based on clicks, engagement, views, and actions.

• CPM / CPV: best for brand building where impressions and awareness are the goal
• CPC / CPA: best for direct-response campaigns
• CPE: requires the publisher and advertiser to agree on what engagement means

Targeting

Most publishers (and platforms) now provide granular targeting options to hone in on your target audiences. These include options such as demographics (age, gender, ethnicity), context, and location. As with other digital advertising options, the more targeted a placement, the higher its price point. 

Performance

Beyond internal metrics related to purchase influence, viewability and shareability are two measures of video ad performance that should always be tracked and measured. Viewability assures that your advertisement was actually seen by the individual and shareability measures it’s virality.

Regardless of the brand that you are building, digital video advertising should be on your radar. Video consumption is significant, especially amongst the Millennial segment, and continues to rise, and digital video advertising provides a viable blend of reach and engagement typical of TV advertising, with targeting and measurability typical of display advertising.