Pre-Roll Video Ads Still Hated, Here to Stay

What Happens When the Most Annoying Format Is Also the Most Effective?

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Jim Louderback
Jim Louderback
In all the internet, is there a less innovative ad type than the pre-roll?

It's pretty much just the classic 30-second spot, lifted from broadcast TV and occasionally shortened to 15 seconds.

Yet when it comes to online video, in the end, that's where the action is. The ad unit has been maligned, foresworn, abused and dismissed. But like a cockroach, it survives, while many other online video ad units have faded into obscurity. Heck, I once promised that there would never be a pre-roll at Revision3, but I was eating my words within a year.

Pre-rolls are not without their problems. A recent study by online video analytics firm TubeMogul showed that the 30-second pre-roll causes nearly 16% -- or one in six -- of every viewer to tune away. That's not necessarily a bad thing, because it still leaves a whole heck of a lot of viewers to make money off of.

The pre-roll is also becoming a standard ad unit even far, far away from video. It's becoming a new type of interstitial, sort of a quid pro quo for using a free web service. As an example, many casual game companies are starting to make watching a pre-roll a condition for playing a game online.

And now we see that, by adding choice to a pre-roll, you can improve effectiveness. Here's how it works: Before viewing a pre-roll, the viewer is given a choice between a handful of ad options. They choose the one they want, watch it, and then get to see the video they really wanted. Hulu's been leading the charge here, but it appears that the Vivaki/Pool group has endorsed selectable pre-rolls as the best way to monetize online video.

Here's the problem with pre-rolls: Users hate them, just as they hate pop-ups, pop-unders, those annoying Vibrant word definitions and auto-playing audio and video ads. But they are effective -- and the selectable variants are even more so: double the click-through rates of traditional pre-rolls, and nearly three times the recall.

Unfortunately, I'm afraid they also depress video sharing and snacking -- which is ultimately how a video goes viral, and how new creators build audiences. We'll soon find out whether this is true, because it appears that YouTube will put pre-rolls on many of their more popular producers as well, including the ones that benefit most from virality.

I still think in-show sponsorship is one of the best models for online video. With the right hosts, the right brands and the right audiences, the results can be spectacular (e-mail me if you want examples and case studies). And I'm really hoping that overlays take off, as they allow an in-video ad experience that's less intrusive than a pre-roll.

But it seems the pre-roll is here to stay. Let's just hope it doesn't kill the goose before we figure out how to get it to lay those golden eggs.

What do you think about the future of pre-rolls? Love 'em or hate 'em?

Leave your thoughts in the comments below!

Jim Louderback is CEO of internet video network Revision3. For more details on these issues, you can reach him at [email protected], or follow him on Twitter: @jlouderb.
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