Well it was good while it lasted. While television networks and advertisers morned the introduction of commercial fast forwarding on television, they have found solace online, where consumers have consigned themselves to sitting through pre-rolls and interstitials if it means streaming high quality video content.
YouTube is trying to change all that. The video giant today announced today that it is launching “skippable” pre-roll ads on some of its videos. The move will help YouTube create better ads, charge better rates for the ads that are seen and improve its ad model. It could also lead to further erosion of video ad views overall, which networks won’t be happy about.
The good news: networks won’t have to worry about that for a while.
YouTube is allowing viewers to skip ads in the hopes of getting feedback on the advertising they serve — and higher revenues from advertisers.
On certain videos, users will be able to click on a link to skip pre-roll ads, and just start watching content. The ads will run on videos from content partners, which
have already opted into the test.
According to YouTube:
rates are affected by several factors, notably length and creative.
When a pre-roll is only 15 seconds, we see completion rates as high as
85%. Also, creative matters a lot: the quality and relevance of the ad
itself seems to have 3x the influence on abandonment online as it does
on TV. Viewers online tend to be much more active in making choices
about what they watch.”
Unless the skip link is incredibly prominent (or the creative incredibly bad), viewers are likely to stick through 15 seconds of commercial, mostly because they’re currently in that habit.
But for YouTube especially, good ads are important. A dog on a skateboard may become a viral hit on the site, but viewers are less likely to partake in the equivalent of video junkfood if they have to sit through an ad to get to it, and the network is incredibly keen to minimize video abandonment. Also, ensuring that viewers are engaged in the ads the do like ensures that they can charge advertisers higher CPM.
The bigger concern is if this takes off and users get accustomed to skipping ads online. For network and other less available content, users are currently willing to sit through ads. But DVRs have proven that given the choice, they will skip. And network plans to weigh down their video content with longer ads online are not likely to go over well.
YouTube is going to use the data collected from this experiment to improve their advertising. As Silicon Alley Insider writes:
“If Google collects valuable user data, this could contribute to the development of a quality-score system similar to the one used to determine the
placement and pricing of search ads. If the model is similar to search,
Google could use data on whether it thinks the ads are likely to be
skipped or elected to be viewed to establish a differentiated pricing
model for placement, thereby enhancing both the user and advertiser
And it gets back to a premise that Google was built on: letting consumers decide what they want to do is never a bad idea. That doesn’t mean that the networks are going to like it.