Programmatic Pre-Roll Ads: What They Are, How They Work, and When Should You Try Them

When diving into programmatic advertising for the first time, the amount of options, tactics, technology, and partners can be overwhelming. Programmatic advertising is supposed to simplify things for marketers, not make them more complicated!

But you wouldn’t know that with the amount of specialized ad inventory and terminology there is to make sense of the programmatic world. Because we’ve helped tons of brands and marketers get programmatic advertising started, we’ve decided to explain many of the common aspects of programmatic ads to those looking for more information as they explore this complex but powerful area of digital marketing.

Today’s topic: “Pre-roll” video advertising!

What is pre-roll?

No, it’s not the bread you eat before a meal, but good guess!

Programmatic pre-roll ads are a form of video ad that are served across mobile, tablet, and desktop devices immediately before a user consumes a piece of short-form video content from a publisher. Common video durations are 15-seconds and 30-seconds.

Why is it special?

Because pre-roll can be purchased programmatically, CPMs are much less expensive than what’s available in the walled gardens. You’ll have the same granular audience targeting and optimization capabilities available in programmatic display.

With programmatic video, you can reach users currently consuming content contextually relevant to your brand, and you can secure inventory on premium sites like Forbes, CNN, and Business Insider, that might not be available to you by other means.

Since programmatic video is served across the internet outside of any walled gardens, there’s the additional benefit of transparency and seemingly limitless scale. Like display, when pre-roll is bought programmatically, frequency caps can be set on a minute, hour, and daily basis (in addition to week and lifetime).

An exciting feature of programmatic video is that skippable or non-skippable inventory can be targeted. With non-skippable inventory, the only way a user doesn’t complete the ad is if they close the tab or pause the video, so you can expect to see high video completion rates of around 75%.

When should I run programmatic video?

Programmatic video is a cost-effective way to support current Youtube or Connected TV efforts. Similar to these channels, pre-roll communicates your brand’s message via a high-impact medium. Alternatively, pre-roll can also be a great way to test creative assets to see what drives strong performance before investing in Connected TV.

If you see a messaging strategy that performs well on display or a video that performs well on social, it could make sense to test that same strategy via programmatic pre-roll video, since it can scale your strategy across a variety of targeting tactics. For example, if an ecommerce brand experiences a large volume of assisted conversions via YouTube, it would definitely make sense to target users currently searching your high-value keywords via programmatic video.

Which metrics and KPIs should be used to measure programmatic video?

Since pre-roll video is usually deployed as an awareness tactic, high-funnel metrics are best to evaluate performance. Common metrics include video completion rate, first quartile completions, and cost per landing page visit. Pre-roll ads are clickable, so some activity is trackable in Google Analytics, but click data is going to be sparse and generally we advise against using direct website action as the main way to evaluate the success of a programmatic video campaign.

A different, but also valuable approach to measurement outside of direct metrics like those above are brand lift studies. Brand lift studies use in-flight advertising to measure survey-based outcomes like brand awareness, ad recall, and even purchase influence, areas where pre-roll video ads are more likely to have an impact than in final purchases.

What are some of the best practices associated with programmatic pre-roll video?

Programmatic video can seem like a complex channel, but there are some general best practices that our team stands by. We recommend testing both 15-second and 30-second ads at campaign launch. Every campaign will be different, but you’re likely to see higher video completion rates (VCR) against shorter video lengths – in most cases, this is 15 seconds. Higher VCR will mean more absorption of the full brand message, which can strengthen brand recall.
Thirty-second ads tend to see a bit lower VCR (typically 5-10% lower), but drive higher engagement in the form of a longer time-on-site and a more efficient cost-per-landing page visit. Even when you run 30-second ads, remember to use the first seven seconds wisely to get the most out of your ads. We strongly recommend against running a programmatic pre-roll video longer than 30 seconds.

Both skippable and non-skippable inventory is available, with non-skippable video typically driving higher video completion rates and engagement. CPMs are only slightly higher on non-skippable inventory (approximately $14 compared to skippable’s ~$12 CPM) and performance tends to be stronger, so we always recommend non-skippable videos to start. Depending on your goals, skippable could be a fit as well.

Pre-roll video is the best of both worlds in terms of optimization capabilities – all of the same levers frequently pulled in display are available, but in a higher-impact medium. Following launch, expect that you’ll need about 3-4 weeks (dependent on investment) for data to gather before pulling any major levers. As we enter the “learning phase” immediately post-launch, a close eye is kept on frequency, day of week trends, and creative performance (15 vs 30 seconds) with targeting tweaks being made as needed.

Conclusion

While the landscape of programmatic is vast and pre-roll video is only one small corner, we hope that this explainer was useful to inform whether it would be a good fit for your brand. Click on the topic tag at the top of this blog post for more of our content on programmatic advertising, or for more tips on video advertising, download our Performance Marketer’s Guide to YouTube Advertising.

With the wide range of solutions and vendors for programmatic advertising, it’s not reasonable to expect you’ll be able to learn everything you need to know in a buying process to have a successful launch right away. Brands taking the leap into programmatic ads need specialists to guide them through the landscape, whether they be internal or external. If that sounds like something you’ll need as you explore programmatic, contact our team!