The Future of Automated Video Advertising

Dec 20, 2017


5 Takeaways from JW London Insights

On November 29, 2017, some of the brightest minds in media and technology converged on London for the city’s first ever JW Insights event .

In a particularly enlightening discussion led by Digiday senior reporter Lucinda Southern, leaders from JW Player, Facebook, Index Exchange and Minute Media shed light on what we can expect to see in the world of automated, or “programmatic,” video advertising in the times to come.

Here are five things we learned about the future of automated video advertising.

Advertisers are following viewers to short-form content.

Recent shifts in video consumption patterns are forcing advertisers to reconsider their historical bias against short-form video.

“Let’s start with how users want to consume content. It’s short-form, largely,” said JW Player COO Bill Day. “If you’re an advertiser, you need to learn how to buy into that format, and if you’re selling, you need to learn how to perfect it.”

In fact, Sherzod Rizaev, global head of commercial ops at Minute Media, noted that he’s already seeing brands migrate from traditional, 30-second pre-roll ads to shorter, 6- to 15-second messages.

The optimal video market will see a mix of direct and automated ad sales.

When asked to name the biggest myth in automated video advertising, Facebook Product Marketing Manager Joe Devoy said that many advertisers wrongly believe that programmatic impressions are always inferior to direct-sold inventory.

JW Player’s Day affirmed that many buyers have this misconception, but predicted that programmatic advertising isn’t about to swallow the entire video ad space. Instead, he suggested that “there’s going to be a large chunk of inventory that’s sold on a direct basis” and that a mature digital video marketplace will have a healthy mix of both.

Anti-fraud efforts like ads.txt will increase video CPMs.

According to Index Exchange VP of Publisher Development Luke Fenney, video advertising is currently undervalued due to the fraudulent inventory in the marketplace.

But as anti-fraud initiatives like ads.txt begin to stamp out bad actors, Fenney says he expects to see ad prices increase substantially throughout 2018.

“I think buyers need to realize that a lot of what they’ve been buying today is crap,” Fenney said, not mincing words. “That is ultimately going to change.”

When it comes to inventory, transparency will be just as important as quality.

Even if the inventory is legitimate, it may be difficult for advertisers to see exactly what they’re buying.

For instance, a DSP might not have the technology to properly read all the information about an impression that’s being passed to it. As a result, an outstream ad might be misrepresented to the advertiser as a higher quality pre-roll.

In order to increase transparency in the marketplace, Index Exchange’s Fenney said that technology partners should update to the latest version of OpenRTB.

Successful publishers will place a greater focus on user experience.

JW Player’s Day was dismayed to learn that outstream video has overtaken pre-roll ads as the dominant format in U.K. video advertising.

Rather than relying on outstream revenues, Day says publishers can generate higher revenues from pre-roll ads by keeping people on-site longer with a better user experience. To this end, he recommends less intrusive ad units, simpler pages, and intelligent content recommendations: “Migrating to an environment where the pages are faster, cleaner, and sold better is the way to go.”

To watch the full video:

For more on JW London Insights, read our recap of The Drum session and visit our video page.

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