This post has been updated.

I've written many times about the topic of inventory quality, the importance of working with credible partners and the fact that not all inventory is created equal.   There continues to be  a widening gap in the perception of pre-roll video quality from buyers, sellers and  content owners.  

Video is an interesting animal.  On the web it is completely unlike traditional linear television, yet it appears to be the same.  Many of the players are similar.  There are content producers, syndicators, distributors and destinations where video can be viewed. 

However, the differences end there.  With television, advertisements generally are viewed during a commercial break nested within, or adjacent to, programming in a standardized format within the 'box' in your living room.  With online video, the viewing experience takes on many shapes, sizes, experiences and placements.  A video advertisement on the web can appear in a banner, before a flash game, as a full page takeover, before or within an actual program (in stream) or as a standalone piece of content (think a movie trailer on YouTube).  These varying viewing experiences make it challenging for the buyer to evaluate the quality of the environment, difficult to standardize rates, and nearly impossible to determine where his ad is running.  

Publishers, as well as many networks, have taken advantage of the lack of standards in online video, using the inequality of placements and the limited tracking capabilities to game the system by delivering video ads in banner, InStream and inGame to help bolster inventory volume.  Early on just about any pre-roll ad was worth about $35+, so increasing the volume seemed logical.  Some companies would even set the video to auto play when the page loaded and classified it as pre-roll, regardless of whether the consumer actually engaged with the content.  Interestingly, most buyers of online video today only understand the difference between in-banner and in-stream and, in many cases, have no idea which version actually runs, especially if the media partner handles the creative build out. 

Recently, some technology startups like Adap.TV and BrightRoll responded to the shift to automated display buying by launching their own video exchange services, which aggregated varying video sources.  This created further distance between the buyer and the actual content owner/distributor, making it even more challenging to evaluate placements beyond price. 

So we now have multiple sellers in market providing "pre-roll" video to buyers across a wide range of price points and a marketer who still does not understand what each price point means.   Let me break it down for you… 

  1. Direct: When a buyer goes direct, the price point is much higher (as expected) but they get specific adjacencies, similar to a television buy. 
  2. Distributors: Next, there are companies that work with a wide array of direct owners/distributors to sell a network of InStream video programming at scale at a midpoint price ($12-$18 CPM).
  3. Aggregators: Finally you have exchanges and aggregators selling InStream plus other types of questionable, lower priced, video at the $4-$8 CPM range. 

Not surprisingly, buyers -- who are under the gun to execute, are under-resourced and are forced to show efficiencies -- will often choose the lowest priced option.  However, they should consider that buying online video inventory in this fashion will likely put them at odds with the ultimate goals and objectives of their client, who is looking to have the brand shown within clean, well-lit environments, adjacent to quality programming, and where its message can be seen and heard. 

 So if you are buying video online, make sure you understand what the risks are, what types of inventory are represented, and which credible partners offer differentiated capabilities and content types that require consumer engagement.   Quality inventory comes at a price, so pay close attention when a buy seems too good to be true… because it probably is.  What do you think? 


This article originally appeared at Real Media Group. Copyright 2014.