ClickZ ran an interesting article on the “state of online video ads” from the vantage point of ad serving firms like Atlas and DoubleClick. While SpotXchange is much more than an ad serving firm-we are, in fact, a full service video network that provides a marketplace for dynamically matching advertisers with available publisher inventory, in addition to providing the video serving, tracking and reporting functions associated with pure ad serving firms-I took an interest in this story.
Author Hollis Thomases identifies various barriers to broader video advertising adoption, particularly third-party video ad serving. The lack of standardization in reporting and measurement guidelines has certainly been a point of contention in the space, but I would argue that it has not been a fundamental barrier. Until the Interactive Advertising Bureau makes much more serious progress on standardization, agencies, publishers and service providers alike recognize that we must make due with the respective measurement and reporting that is available. Reach and CTR, familiar metrics offline and on, respectively, have shown to be those generating the most interest from advertisers. A number of more advanced metrics are available from some service providers, including SpotXchange, but I’m not convinced that advertisers have figured out how to best act on those metrics, so they remain a novelty to most.
Different ad formats, according to Thomases, represent another challenge to advertisers. I agree with Atlas’ Geoff Coco, quoted as calling this a non-issue. (SpotXchange has worked quite closely with Coco as members of the IAB’s third-party ad serving committee). Transcoding an advertiser’s original video commercial into the few formats that publishers need (more than 94 percent of the traffic across our network in December 2007 was FLV) is a commodity service that should intimidate absolutely no one. If Thomases and her colleagues do not see this happening readily, the problem isn’t that they are not asking “loud enough”, it’s that they are not asking the right question, or perhaps not the right person.
The more pressing challenge, as Coco points out, is “how the player interacts with the ad system and its content feeds…[and the]…interoperability…[of] the ad request and delivery formats.” I think this point may be lost on the author because she is mistakenly under the impression that, “with initial online video ad space in demand and inventory availability low, publishers could easily sell out their ad space without having to make any system modifications.” This may be true for ABC’s Desperate Housewives, or other “super premium” content providers, but it’s not the reality for the other 99 percent of publishers out there. Not only do they not have the “brand name” that brings advertisers to them, they lack the sales and serving infrastructure that would allow them to fully accommodate these advertisers if they did come knocking. Show me 99 different publishers and I will show you 99 different video player components and configurations that may, or may not, be compatible with advertisers’ preference for serving and tracking their campaigns.
Most publishers rely on multiple ad sources to fill their available inventory-generally a direct sales effort, as well as membership in one or more networks like SpotXchange. It’s the diversity of the various publishers and their player technologies, compounded with the diversity of ad suppliers, that make interoperability and integration the industry’s real bugaboo. Serving video ads is hard. Serving video ads from multiple sources (and creating the business logic to direct which source to hit at which time and under which circumstances) is even more challenging. Serving multiple ad units, including InStream (pre-, mid-, post-roll) and interactive overlay units (such as SpotXchange’s own InnerStream unit), from multiple sources is more daunting yet.
These complexities are why SpotXchange and other ad providers invest so much time and energy developing competency at ad syndication and integration-it’s one of the most significant assets we bring to the advertiser/publisher equation. If advertisers and publishers allow us to do our jobs correctly, neither of them should have to invest heavily in building their own capabilities in these processes.