14 DAY TRIAL // Online video is growing at an increased rate and, despite growing revenue from advertising, video sites are still struggling to become profitable. Even YouTube, which dominates the market, hasn't managed to achieve this, but it's not for lack of trying. Slowly but surely, though, it's getting there and a new, skippable pre-roll video ad format might take it one step closer.
Pre-roll ads aren't completely new to YouTube, it tried them before, though the results were less than encouraging. In fact, 70 percent of the users would rather not watch the video at all than wait for the ad to finish. The small length of most videos on YouTube makes the ads look very long, despite being a lot shorter than TV ads, for example. But, as in some cases the ads were even longer than the video itself, it's easy to see why they weren't so popular. Pre-roll ads, though, work much better for longer videos and YouTube has had much better success with ads in videos longer than 15 minutes, where 85 percent of the time users would watch through them to see the videos.
Google now aims to change this with a small test in which users will be able to skip the ads that show up before the video or during it for longer content. These ads will only show up for a small number of users and are only available with a few advertisers, which have opted-in for the test. The goal is to see what ads get the users more engaged and to generally learn more about how they respond to the ads when they have the option of skipping them.
"We're already down that road with promoted videos," Phil Farhi, product manager at YouTube, told Mediapost. "We see the ability to skip ads as another form of engagement. [...] On television you might need 30 seconds to make sure people know the Web site and phone number, and tell them the offer three times," he added. "Online, you can run a much shorter industry ad, and use the companion ad space for the call to action."