If you've been keeping up with recent news and announcements about in-stream video advertising, you know that pre-roll ads get all of the attention. For just a minute, I'd like to discuss the overlooked mid-roll ad format. It's not such a radical concept. I'd say it's been pretty successful in that other medium, TV.
Lean Back With the proliferation of broadband comes an evolution toward long-form content that lends itself to a "lean-back" viewing experience as opposed to the "lean in" method for watching short clips on a computer. As users view more Web-based video content on larger screens, via set-top boxes, and on mobile devices, we'll start to see an explosion of long-form content.
The problem with publishing long-form content online is the cost (encoding, licensing, hosting, etc.). With current advertising rates, a pre-roll ad simply won't cover those costs. However, with several mid-roll ads inserted at relevant points within the content, publishers can cover their costs and even generate a profit. There is a ton of long-form content out there that many publishers and content owners have been waiting to monetize. With the development of intelligent mid-roll ad insertion technologies and demand from advertisers, we will begin to see more and more of it come online.
Location, Location, Location As more long-form content comes online, it will help alleviate the biggest problem currently facing online advertisers: inventory. And this new ad real estate is likely more valuable than its pre-roll counterpart. A user viewing a mid-roll ad has committed to watching the content and is captive and engaged, so completion rates are higher. Mid-roll ads also offer enhanced targeting possibilities such as sequential ads within a single piece of content or ads inserted near segments of content that closely relate to an advertiser's product.
Users will be accepting of these in-stream ad insertions because, after all, it most closely resembles the traditional TV format. Given a choice between pay-per-view and ads, users prefer ads by almost three to one.
I'm excited to see how the mid-roll ad format evolves as the online video landscape matures. By the time we're all watching Jack Bauer's escape on our laptops and cell phones, it's more than likely that the terms "pre-roll," "mid-roll," and "post-roll" will start to disappear and be replaced by a more universal ad name that would cover all formats and all viewing devices. Maybe even something crazy, like "commercials."