The volumes of digital video consumption are growing each year, but in 2020 this trend became specifically notable due to social distancing and recent technological developments. Many experts estimate that this tendency will only strengthen and the impact on the online video advertising industry can be quite dramatic in the years to come.

According to Emarketer, over 39% of the world’s population will be consuming digital video content by 2023. Given that by this time the global population is projected to reach 8 billion, one can easily calculate what that means for video in advertising. Over 3.1 billion people can become your potential customers, so advertising with video is clearly becoming a must for global businesses regardless of their industry.

A lot of marketers already took these statistics into consideration and started to use video for advertising their businesses. In fact, as many as 92% of marketers reported that video ads played a crucial role in their promotion plans in 2020. For the coming years, all experts expect this industry to grow and develop, so for every marketer, there are certainly a couple of trends to watch regardless of business specifics. So what is video advertising? And how to integrate it into your marketing strategy? Read on to get the latest tips for your business!

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What is video advertising?

Before we jump into sophisticated marketing techniques and newly developed trends, let us start with stating a clear digital video advertising definition:

Video advertising is a broad marketing term that includes all kinds of promotional video content displayed via various digital platforms and devices, such as desktop, tablet, or mobile devices, connected TV, and even gaming consoles. These video ads can be shorter or longer (over 15 seconds), displayed within, before, or after the streamed video content, and distributed via several different channels, such as broadcast, cable, satellite, etc.

Apart from this, video ads can be found within a banner or an article, newsfeed, or even a mobile app. Furthermore, one can use videos as a part of their native advertising strategy, rich media campaign, interstitial ads, as well as in-app rewarded video.

What are the benefits of online video advertising?

The ad market is getting more and more saturated with the infinite streams of content that users consume on a daily basis, and long gone are the times when you could get someone’s attention by a colorful banner. The Internet is filled with vivid, sometimes even intrusive ads, so encountering a relevant and immersive web video ad can really feel like a breath of fresh air. But apart from a more positive user experience, there are a couple of other benefits of video advertising online we’d like to mention:

  • Eye-catching. Dynamic and immersive video ads are a great way to get users’ attention and increase brand awareness. It is a great opportunity to share a lot of details in a short time; hence, increasing your chances to really stand out in times when information overload is quickly becoming a new norm for many of us. Forbes reports that an average user stays on the website with video content for 88% longer compared to other sites, which gives you even more time to impress your visitors.
  • Great visual capabilities. One video advertisement can do a bigger job showcasing your product than long-read descriptions and pictures about it. Also, an advertising video can present your product from different angles, educate on its functions or deliver a powerful message - things that would take much more time and effort for other formats.
  • Space for creativity. Apart from this, video ads provide a lot of space for creativity and your own unique strategies and ideas. To build a better connection with your audiences, one can play with angles and colors, background sounds and music, and any other details you feel into. In fact, with the help of just one video ad, you can already deliver a real story that would catch your potential clients’ attention, entertain and educate them at the same time.
  • Broad reach. An illustrative factor for a successful and memorable video on advertising is your brands’ increased reach. If consumers are enjoying your video ad they are quite likely to share it with their friends, growing your audiences even more. This works even better in combination with user-generated content - getting users’ attention and response is much easier with video than it is with a single banner image or short text. Videos on advertising look much more dynamic and vivid, which makes them much more appealing and entertaining for users.
  • Move with the times. Including advertising video into your strategy is not really a novelty anymore. In fact, most marketers worldwide are already doing it, and competing without these formats may become increasingly harder. One of the main reasons for this is the fast-paced technological development in the industry, such as the global introduction and implementation of the 5G network. With such support, video advertising has all chances to dominate the next decade, so now is the perfect time to jump in!

We have listed only the most important and universal benefits of video advertising that can be leveraged by any business owner from any part of the world. Nevertheless, there are also a huge number of business-specific advantages defined by your vertical, target audience persona, and many other factors. We recommend trying video ads for yourself to get a unique first-hand experience with this format and explore how it will improve the results of your advertising campaigns.

The growth of digital video advertising

To get a clearer view of the growth rates and the future of video ads, let’s have a look at the current state of digital video advertising.

According to Statista, in 2021 the US video ad spend is expected to grow up to $22.18 billion. When it comes to a more global picture, experts report a 10.8% growth of worldwide online video ad spend throughout 2020, and in the future, this trend is projected to strengthen. It is anticipated to reach 11.5% in 2022, while over 82% of all Internet traffic will be coming from online videos.

change in global ad spending

As we can see, the industry is scaling up quickly and when it comes to versatility, numerous unique solutions and new formats are constantly being developed. Starting from virtual reality videos to live broadcasting, the immersive possibilities of video advertising are becoming more and more attractive. With formats like 360 panoramas and other interactive solutions, the connection between brands and their audiences can get stronger than ever.

The 5 steps to a successful video advertising campaign

Leveraging the full benefits of video advertising can be quite simple if one clearly defines first all of the details that work best for their specific business objectives. Here are the 5 steps to consider for building a perfect video ads campaign:

Step 1. Consider your audiences. The core of video advertising is creating a closer connection to your potential buyers, which is mostly accomplished by incorporating targeting solutions and personalizing your message. To build a solid relationship with your clients, consider digital video viewers and your potential audiences. This will help you to create and distribute a message that would deeply resonate with them.

  • Step 2. Choose your format. Video ad formats are quite versatile and include numerous solutions for all types of businesses. Study the channels that work best for your business and choose the appropriate formats to make your videos even more memorable.
  • Step 3. Try different sizes. Some video ad units show more visibility and greater ROI than the others depending on channels and platforms they are distributed through. Understanding this relation is often the key to get the best results.
  • Step 4. Watch for the trends. Not only experimenting with new trends and solutions can be a great source of inspiration, but also can drastically improve your revenues. Trying these for your business can drive your sales by delighting your customers and improving brand awareness.
  • Step 5. Get a holistic view. Once you incorporate all of these insights into a holistic view, your video ads strategy will be practically finished. As a result, you’ll be able to deliver trending messages with the right size and format to the right audience and through the right channels.

Now, let us study each of these steps in more detail - below you will find some key insights based on our research and experience that will help you build an effective video advertising campaign.

Global video advertising audiences

Millions of video content viewers worldwide sounds like a wonderful opportunity, but it could all be useless if it wasn’t for marketers who research first who these people actually are. If we take a look at the actual data it will become much easier to understand the landscape and get the most for your business objectives.

digital video viewers online

According to Emarketer, the geographical distribution of digital video audiences over the next three years will look like this:

In 2020 global number of video viewers reached 2,781 million, of which 1,541 million live within the Asia-Pacific region, over 500 million in North America and Western Europe, about 298 million in Latin America, and 182 million in the Middle East and African continent combined.

There will be over 100 million more digital viewers in 2021, and by 2023 this number is going to reach 3,141 million people. Asia-Pacific region will experience especially significant growth with almost 300 million new viewers.

These numbers include users of all ages who consume video content at least monthly. When it comes to average numbers, daily video consumption has risen dramatically in just a couple of years. While in 2018 average time spent watching videos was 1.5 hours per day, in 2021 this number is close to 2.5 hours.

Particular attention is focused on the two younger age groups: 8-12-year-old kids and 13-19-year-old teens where 56% and 66% respectively reported watching online videos every day. This is a huge opportunity, especially for businesses from the related industries, but one can also possibly encounter a lot of competition there.

These are the most significant trends for some regions and demographic groups, but of course, video advertising is not limited to these specific tendencies. We recommend studying other aspects like best-performing video ads formats and sizes depending on your business objective to thoroughly refine your marketing strategy.

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Best performing video advertising formats

In order to leverage the opportunities provided by video advertising formats to the full extent, it is important to study its best-performing video ads formats and capabilities, as well as the ways these can be implemented into your own business strategy. Here are some of the most popular video ad formats that you might find useful:

  • In-banner video ads. Perhaps the most common video advertising format, these ads are usually built inside usual banner ads of various sizes. These include 300x250, 160x600, or 728x90, as defined by the International Advertising Bureau (IAB). It works well for ad campaigns focused on viewability and simplicity, and it also is quite affordable.
  • Reveal videos also look like a part of the website’s content, but this kind of videos is played when the users scroll it down to the visibility zone. These can be in the middle, closer to the end, or right after the first couple of sentences of the content. These video ads provide great viewability, as well as higher engagement rates.
  • Rewarded video ads. One of the most interactive opportunities for mobile video marketers that also shows great completion rates. These videos are usually around 5 to 10 seconds long and allow users to view, click and interact with an ad in exchange for the reward - for instance, a bonus in a game, premium content, additional functionality, etc.
  • In-stream ads. These are the ads displayed around streamed video content. There are three main types of such in video advertising which include: pre-roll videos (these appear before the steamed content), mid-roll (these are played in the middle), as well as post-roll ads (distributed after the video). They usually have higher click-through rates and are among the most cost-effective video ad formats.
  • Native video ads are usually blended in with the website or platform they are displayed on. In general, native advertising mimics the design and style of the original video content to provide an immersive and non-intrusive user experience. They get more sharings on social media. As a result, these ads usually get more clicks and shares, allowing brands to build deeper connections with their audiences.
  • Interstitial advertising includes full-screen video ads that pop up when the content is changing or in-between the game. These ads can be interruptive, but are more memorable and drive more engagement the more precisely they are tailored to the relevant audiences. Combined with rich media elements, interstitial videos can be quite effective which makes them especially popular among mobile marketers.
  • Playable ads are one of the most interactive formats that mixtures video ads with games. They normally last from 5 seconds to around a minute and showcase a game or an app. The main aim of playable ads is to provide users with an opportunity to try your product or service and to encourage them to install it right after this short demo. These ads are highly interactive and often show some of the best completion rates.

In general, native video ads and full-screen interstitials tend to show greater results, as compared to usual banner ads. When it comes to the efficiency of video advertising formats, our stats show that rewarded video, native, and interstitials are among the top-performing formats. This is especially notable for mobile and in-app campaigns where these types of ads usually provide higher engagement rates.

It is also worth noting that omnichannel marketing campaigns tend to show even better performance with videos. By utilizing multiple platforms advertisers can effectively reach each of their target audience personas and increase the campaign’s ROI by 20% or even more. In addition, our data confirm that adding two extra video ad formats to your existing strategy can boost your revenues up to 70%!

Best performing video ads sizes

Apart from choosing the right video ad format, it is important to find the best ad sizes for your offers and align them with the formats and channels you use. As always, each of them has its ups and downs and can be more suitable for your specific goals and other parameters. Depending on these factors combined with data from our 90-day research on different sizes’ effectiveness, one can easily choose what fits best for your business:

As defined by the IAB standards, the most common banner ad sizes used on the desktop include:

  • Billboard - 970*250
  • Large Rectangle - 336*280
  • Medium Rectangle - 300*250
  • Leaderboard - 728*90
  • Skyscraper - 120*60
  • Wide Skyscraper - 160*600

Among standard tablet and mobile ad sizes, marketers often use:

  • Smartphone static banner (Mobile Leaderboard) - 300*50
  • Large mobile banner - 320*100
  • Mobile phone full screen - 320*480
  • Mobile phone thin full screen - 300*600
  • Tablet interstitial - 768*1024

As for the performance of these sizes, our findings confirm the following:

Wider ads often correspond to higher ad viewability rates. Larger banners show better visibility and engagement rates, especially if they are located closer to the upper corners of the web page.

Large (336*280) and medium (300*250) rectangles serve specifically well for catching user attention.

Medium rectangle (300*250) is one of the most popular and effective ad sizes - it accounts for 36% of all served impressions and provides 33% impression shares.

When it comes to engagement and shares, great results are observed for leaderboards (728*90), skyscrapers (120*60), and large mobile banners (320*100). These ad units account for 32%, 13%, and 10% of impression shares respectively.

77% of all impressions are generated by large and medium rectangles, leaderboards, skyscrapers, as well as large mobile banners.

Video ad sizes performance & channels

There is a certain link between the results shown by different video ads and the platforms they are distributed around. Video ads, as well as user generated content shared on social media platforms like Instagram or TikTok, are mostly vertical, while for YouTube horizontal videos are more favorable. It can also depend on your geos or the device type used by the viewer.

For instance, the number of interactions with ads was found to be slightly higher for mobile devices (53%) and this trend is much stronger for Asian countries - like Japan, where 57% of ads are consumed from mobile. In particular, the highest click-through rates were observed for mobile interstitials (1024*768 and 768*1024) with 12.9% and 8.3% CTR respectively, as well as full-screen ads (480*320 and 320*480) with 6.9% and 4.3% CTR.

Video ads performance by format

Similarly, video ads of different sizes show different results depending on the chosen ad format. In general, the top-performing video ads sizes include 320*480 and 480*320 for mobile, as well as 768*1024 and 1024*768 for tablets. The same sizes also work well for interstitial ads both on desktop and tablet.

Most promising native ad sizes include 320*480 and 300*400 for mobile; 728*90 and 300*250 for tablets. At the same time, mobile rich media ads show the greatest results for sizes 600*500 and 320*480, while for tablets wider ad units are more favorable - such as 1200*627, 1200*629, and 627*627.

Our final step is to monitor current trends and try them for reaching your unique business objectives. The video advertising industry is constantly growing and new solutions are springing up like mushrooms, so one should certainly watch for these developments to timely jump in and leverage their full potential for their brand. Here are some of the most exciting opportunities for 2021:

Longer video ads formats. It’s no secret short videos are gaining popularity on social media in recent years - nevertheless, recent data shows longer video advertisements can actually also be quite effective. For instance, according to Statista in the US the most popular videos usually are around 30 seconds long. Moreover, 72% of mobile and tablet users tend to show even more engagement after the first 6 seconds of the video and up to around 22 seconds. These work specifically well if one adds up an element of storytelling to showcase how their business improves their clients’ daily lives, shifting the focus from brands to their customers’ needs.

Animated videos. Motion-tracked graphics, cartoons, and footage blended with animation are becoming more popular for advertising with video, as they allow brands to create fun and lively content without huge investments. Animations allow marketers to share an appealing story understandable to every audience from all sorts of industries that can fit any point of your sales funnel.

It can also be used to create a solid brand image or symbols like well-known Ronald McDonald or Mr. Clean by Procter & Gamble. This trend can be also efficiently used for explainer videos on advertising that are rapidly growing in popularity in 2021.

Explainer videos. Promoting your services often requires educating your customers and explainer videos are a perfect tool to do this. Brands often need to showcase their services, clarify how to use their product, share values, or describe complex concepts behind their mission. This became especially relevant since the pandemics - the global e-learning market grew by 36.3% in 2020.

By providing your potential customers with valuable information, one can establish a solid brand image without being intrusive or pushy, so that your audiences will be willing to learn and try products themselves. As for B2B services, explainer videos can also become your tool to establish your brand as a thought leader regarding your topic.

360-degree experience. This rising trend is a perfect opportunity to create immersive experiences and to showcase your services within various environments. Such a unique visual adventure is considered far more exciting by 98% of American consumers and 41% view it as a perfect opportunity to try the offers in action before purchasing. It also provides 46% higher video completion rates and over 300% click-through rates as compared to the traditional display advertisements.

Virtual and augmented reality content is another example of interactive trends that is likely to grow in video advertising in the years to come. According to Statista, by 2024 it is expected to reach $72.8 billion which is a six times increase from now. This technology allows users to visualize products and various environments without having to physically transport them. It is especially relevant during the lockdown. VR is currently mostly used within the gaming and entertainment industries, but it can potentially revolutionize advertising and shopping experiences, so grabbing this opportunity may be crucial for many brands across industries.

The final word

The growth of the digital video advertising industry provides more and more opportunities for advertisers. The ability to showcase your product and share an immersive experience allows businesses to bring their connection with customers to a brand new level. With the help of video ads, one can reach broader audiences, capture their interest and engage them.

What is more, all of this is achievable by following a few simple steps: getting to know your audience, learning your top-performing sizes and formats, and applying the right cutting-edge trends and solutions. SmartyAds DSP is designed specifically to help businesses put into practice effective video advertising strategies. We offer a wide range of video ads sizes and formats suitable for all business verticals - instantly deliver your message to customers in the most relevant form and channel.

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