Programmatic Video Advertising Explained: What Is It and How Does It Work
- What is programmatic video advertising
- Benefits of programmatic video advertising
- Disadvantages of programmatic video advertising
- Formats of programmatic video advertising
- How to create effective programmatic video ads
Programmatic advertising has become a necessity for any brand that wants to grow. It can take many forms, be broadcasted on different platforms, and target different audiences. Today, 75% of all advertising in the digital ad space is programmatic. And 54% of consumers want to see more video content from the brand they're interested in.
Programmatic video advertising refers to the practice of using bots to buy ad space based on set pre-conditions. The advertiser defines their ideal audience in detail, provides access to their ads, and sets a budget.
The program takes this user data and uses real-time bids to show this ad to the user who matches the ideal customer profile. As with other programmatic DSP ads, the ad with the highest bid wins. All of this happens in the time it takes for the page to load.
Here we'll talk about a type of programmatic advertising called programmatic video advertising. This is one of the most common and in-demand advertising formats on the market, so it's important to know how it works and what features it has, as well as how it can be used.
What is programmatic video advertising
Programmatic video advertising is a technology of algorithmic purchase of video ad impressions only for target users. Programmatic has extensive targeting capabilities and self-learning artificial intelligence that optimizes the ad campaign in real time.
About 75% of online video ads are shown automatically with programmatic video advertising and the percentage will only increase each year.
Programmatic media buying platforms allow brands and marketers to buy advertising through an ad exchange. It gives brands and marketers several distinct and very important advantages.
First, it eliminates intermediaries and simplifies the ad buying process to a 1-on-1 deal. Second, because of the detailed targeting demographics available, programmatic ensures that every impression a brand or marketer receives when buying an ad is much more targeted and, therefore, relevant. It turns out that such advertising is much more effective at getting the desired conversions.
Benefits of programmatic video advertising
Programmatic video ads can be placed on different platforms, and they can be transmitted to various devices. This is a worthy advantage, especially considering how many gadgets people use in their daily lives. Programmatic advertising can be streamed on everything from TV to smartwatches.
The whole process of buying ads is automated and takes seconds, saving time and budget. In addition, real-time bidding ensures the delivery of a particular ad to a specific user at a certain time.
The advertiser always knows where the ad was placed, who saw it, and how they interacted with it, thanks to a precise analytics system. Moreover, this data can later be used to set up future ad campaigns.
Audience buying happens in real time and takes moments. In addition, at any moment of the advertising campaign, you can see the actual data on its progress and, if necessary, correct the settings, which also significantly saves time and resources.
Broad coverage of your target audience
The expansion of the inventory for advertising on sites allows programmatic videos to reach a large number of relevant users.
Disadvantages of programmatic video advertising
In the digital advertising world, you can run into fraudsters and the field of advertising is no exception. Special programs can fake video ads views or create hidden views. Scammers can also create click farms, through which they can simulate users performing valuable actions.
Therefore, it is recommended to work with large and proven software platforms and to follow current security protocols aimed at countering ad fraud activity.
Data quality is a hot topic in the programmatic advertising industry. At times, data may be provided by a third party, but not all providers of such data do their jobs with integrity. Also, if you're using an ad network, it's impossible to tell exactly where your ads will be shown. Sure, there are lists of prohibited words or resources where your ads cannot be published, but there is still no 100% accuracy in where your ads will be shown.
It is also worth discussing the sources and quality of the data used with your media partner before launching your advertising campaign.
Programmatic video advertising is a fairly complex format that requires compliance with certain technical conditions. You need to be sure that the file size of the ad does not exceed the recommended size. When placing video ads, you need to monitor the performance of landing pages, loading speed, and other technical issues.
Formats of programmatic video advertising
In-stream video ads
If you've ever watched anything on YouTube, you're probably familiar with this type of advertising. It allows ads to be inserted into a digital video clip that is played by the user at a specific point in time.
In this format, the ad is played inside the video player. It can be divided into:
- Pre-roll — ads are shown before the beginning of the video;
- Mid-roll — showing video ads in the middle of the video;
- Post-roll — ads are shown at the end of the video.
This type is more expensive but has the highest visibility.
Also, each type of in-stream video is divided into skippable and unskippable. Meaning, the user can either skip the advertising clip, or they are obliged to see it to the very end.
The audience intends to watch the online video content in which the ad appeared, so users usually stay on the page until the end of the video ads.
In display ads
This type of advertising appears in the recommendations from YouTube or in the first lines of YouTube searches. Also, programmatic display advertising videos can be in the upper right corner of the screen if you use the desktop version of the app. Such online videos don't play on their own, the user has to click on them to view the video.
Outstream video ads
Out stream video ads are the ads, which are displayed between text messages, online articles, and other content in the news feed; ad space is not dependent on the video player.
The advantage of this format is a wider selection of video ad inventory. When a video comes into view, it plays without sound, but the user can turn the sound on, watch the video content and navigate through the ad, or just swipe and close it.
In-Banner video ads
The video is displayed inside a banner. When an ad comes into view, the video automatically plays without sound. This format is very similar to outstream video, but they differ in the way that in-banner video usually plays a looped and short video, while outstream can contain a full clip.
In-game video ads
This format of video advertising is usually used to place targeted ads in game apps. Recently, in-game videos have become an extremely popular advertising format for both advertisers and publishers, represented by game app developers.
There are several types of video ads — interactive, cross-page, and rewarded video.
Interactive advertising allows you to interact with the video: try out the gameplay, select options, and watch a preview of the advertised application. This type is characterized by high rates of engagement and conversion.
Cross-page ads are shown at the moment of transition from one thing to another inside the game. For example, when loading between levels or when switching between different locations. Usually, the player can minimize or close such a video after a certain amount of time required for the loading of certain game data.
Rewarded video advertising
Rewarded video offers users various in-game bonuses for watching video ads. This is probably the most popular and requested format of in-game advertising at the moment. Not only it doesn't annoy the user by showing the advertisement in the middle of the game, but also motivates them to get more involved in the gaming process. And because of the bonuses received in the game and the good mood, players form a positive image of the brand advertised this way.
How to create effective programmatic video ads
In order to create effective video ads, you have to follow certain rules. In this paragraph, we will list the basic conditions necessary to create a good, memorable video ad that will fulfill its intended function.
Take into account the ad placement
Different types of video ads work differently. Therefore, you need to determine on which platform your video content will look best. For example, a video that can't be understood without sound is likely to be useless in the in-banner ad format but will work great for the in-stream format.
A short and clear message for the user's attention
Sometimes commercials are works of art. The Cannes Festival winners are watched not because they're promoting a famous car brand or soda, but because they're masterpieces of video making. However, if you have a clear purpose (for example: to inform about the conditions of the starting promo), then make a long, burdened plot reel to nothing. Advertising should be short and clear.
Despite the fact that you do not have much room for your imagination, you still have to throw it into the abyss of ideas for ads. Since you are fighting for the attention of users who are used to all the possible tricks of marketers, you will have to stand out with something. So don't forget to be creative. You vitally need the attention of users; today it is the most expensive commodity in the advertising market.
Take into account the audience
Any marketer knows that advertising will be different depending on what audience it appeals to. Ads for zoomers will be quite different than ads for millennials, and ads for Japanese will be very distinct from ads for Americans.
Programmatic video advertising is a must-have tool in any marketer's arsenal. Thanks to programmatic video advertising platforms, video has become a flexible and accessible ad format that can be placed almost anywhere. This is an important step for the entire programmatic industry, which will allow many brands to greatly advance their advertising opportunities. SmartyAds DSP, of course, also lets you set up and run programmatic video campaigns at any time, at any scale.
Launch your programmatic video ads on SmartyAds DSP!
Irina Kovalenko, CMO of SmartyAds