What is Video Advertising?
Video advertising refers to the use of video content, such as commercials or promotional videos, to advertise a product or service, and can be used on various platforms, including websites, social media, and television. Video ads typically appear before, during, or after a video stream (known as pre-roll, mid-roll and post-roll) or as standalone ads, with the goal of capturing the viewer's attention and persuading them to take a desired action, such as purchasing a product or visiting a website.
Most video ads are bought, sold, and displayed programmatically (meaning the process involves purchasing and selling ad space in real time using a software solution such as an ad network) — largely through social media platforms — applying an array of targeting methods, and increasingly integrate interactive elements to further enhance engagement.
Video Advertising vs. Display Advertising
Businesses — particularly those new to online advertising — often confuse video advertising with display advertising, and vice versa. The two methods share some similarities, including a long mutual history of successful utilization, as well as some key differences.
Display advertising typically refers to ads that are made up of text, images, or a combination of the two, and can include static images, GIFs, and HTML5 elements (think interactivity and animations). Video advertising is a subset of display advertising that leans heavily on actual video clips accompanied by minimal messaging copy and a CTA (call to action, or what you want someone to do after they see your ad).
Both types are typically found on websites, social media platforms, and other digital properties, and are conveyed through their own sets of formatting options (more on that later in this article). Both are used to increase awareness, drive consideration, and/or increase reach.
Display advertising promises to put your ad in front of any number of targeted viewers through any number of websites that feature related content and potentially interested audiences. With the exception of interactive components, display ads tend to be a passive experience: the ad appears and plays, the viewer watches and ideally engages.
With video advertising, the user can usually choose what and when to watch, resulting in a captive audience of proactively engaged viewers. Also, on many platforms the advertiser only pays when the user chooses to engage with their content.
96% of video marketers say video marketing has increased user understanding of their product or service, and 95% say video marketing has helped them increase brand awareness. (Statista)¹
Trends in Video Advertising
With the rise and ubiquity of digital platforms and the growing popularity of streaming services, the demand and possibilities for video advertising have never been greater. All indicators point to video advertising continuing to play a significant role in the advertising industry over the next decade. Several trends are currently shaping the industry, fueled by rapid, dynamic evolution and growth.
- Shift to digital platforms: With more and more people consuming video content online, advertisers are increasingly turning to digital platforms such as Snapchat, YouTube, and Facebook, as well as streaming services like Netflix and Hulu, to reach their target audiences.
- Programmatic video advertising: The use of automation and data to deliver video ads to the right audience at the right time is becoming more prevalent, allowing for more effective targeting, real-time optimization, and better measurement of ad performance.
- Interactive and immersive video ads: Advertisers are increasingly using interactive and engaging video ads, such as shoppable video ads and interactive video ads that allow users to interact with the ad in some way, to increase engagement and drive conversions.
- Video in e-commerce: The use of video in e-commerce and social media platforms is becoming more prevalent as major players such as Snapchat have incorporated video as a core part of their functionality, and e-commerce platforms such as Amazon have started using video to show product details and features.
- Use of influencers and user-generated content (UGC): Advertisers are partnering with social media influencers and using user-generated content to create authentic and relatable video ads that align with their target audiences.
- Personalization: With advancements in technology, advertisers are able to deliver more personalized video ads to their target audience, providing a more relevant and engaging experience for viewers.
- Vertical video: With the increase in mobile usage, vertical video format is becoming more popular, as it works better on smaller screens and users tend to hold their phones vertically.
- Video ad formats: Advancements in technology are helping newer video ad formats such as Virtual Reality (VR) and Augmented Reality (AR) ads to become exponentially more viable, providing new ways for brands to interact with their customers.
In both the long and short term, video advertising will continue to be a vital part of the advertising ecosystem, and it will continue to evolve as technology and consumer behavior change.
Types of Video Ads
With that foundation in place, let’s look at some of the most common types of video ads available to advertisers, each of which has its own unique characteristics and best uses.
- Pre-roll ads: These are short video ads that are played before the main content, typically on streaming platforms or video-on-demand services. They are often skippable after a few seconds, allowing viewers to choose whether to watch the ad or not.
- Mid-roll ads: Played during the main content, typically on streaming platforms or video-on-demand services, these ads are often placed at natural breakpoints in the content, such as between episodes of a podcast or TV show.
- Outstream ads: These ads are placed within the content on a web page, typically in a mobile or desktop environment. They are designed to play automatically when they are in view, regardless of whether the main content is playing.
- Bumper ads: These short, non-skippable video ads are typically 6 seconds or less in length, deliver a quick, impactful message, and are best used to drive brand awareness/recall.
- In-stream ads: These are video ads that are played during the main content, typically on streaming platforms or video-on-demand services. They are similar to mid-roll ads, but are delivered in the same format as the main content.
- Interactive video ads: Best used to increase engagement and drive conversions, these ads allow viewers to interact with them in some way, such as by clicking on links or taking polls.
- Shoppable video ads: These ads enable viewers to purchase products directly from the ad, and are ideal for driving sales and increasing conversions.
- VR and AR video ads: These use virtual reality (VR) and augmented reality (AR) technology to create immersive and engaging experiences for the viewer. Used properly, they are instrumental in developing impactful and memorable campaigns.
As with other ad types, the choice of video ad format depends on a campaign's objective, target audience, and desired results.
Including Video Advertising in Your Marketing Mix
Not quite sure if video ads should be part of your business’s campaign strategy? Check out these reasons why it makes plenty of sense to include video advertising in your marketing mix:
- High engagement: Video ads have the ability to grab the viewer's attention more effectively than other ad formats, such as text or static images. They can also convey information in a more engaging and dynamic way, which can lead to higher engagement and better recall.
- Strong emotional impact: Video ads have the ability to elicit strong emotional responses from viewers, which can lead to more effective persuasion and more effective branding.
- High shareability: Videos are more likely to be shared on social media platforms, which can lead to more exposure for the ad and the brand.
- Better tracking and measurement: Video ads can be tracked and measured more effectively than other ad formats, allowing businesses to better understand their performance and optimize their campaigns.
- Versatility: Video ads can be used across a wide range of platforms, including television, websites, social media, and streaming services, which allows for a wide reach and the ability to target specific audiences.
- Interactivity: Video ads can be made interactive and shoppable, which can increase engagement and drive sales.
- Showcasing products and services: Video ads can be used to showcase products and services, providing a more detailed and informative look at what a company has to offer.
- Video in e-commerce: As e-commerce continues to grow, video will become an even more important tool for showcasing products and driving sales, both online and in-store.
In short, video advertising is benefit-rich and can help businesses increase brand awareness, reach new audiences, generate leads, and drive sales. It's important to note that video ads are not always the best fit for every campaign — but when used correctly, they can be a powerful tool for converting audiences.
Creating and Running Effective Video Ads
Crafting a persuasive video ad to run in your campaign requires a combination of creativity, strategy, and a solid understanding of your target audience. To get your creative right and maximize your ad's effectiveness, make sure these considerations are part of your process:
- Define the goals and objectives of the ad: Before creating your ad, clearly define the goals and objectives of the campaign it’s supporting — such as increasing brand awareness, driving sales, or generating leads — based on what you want to achieve.
- Define your target audience: Conduct research to gain a deep understanding of your target audience, including their demographics, interests, and pain points. That effort will help to ensure that the ad speaks directly to the people you want to engage and convert.
- Plan your video: Decide what your video will look and sound like. (While people often use their phones with sound off, 64% of Snapchat Ads are viewed with sound on, so keep that in mind².) Make sure your ideas align with your campaign objective, resonate with your target audience, and highlight key benefits of your product or service. Always include a call to action.
- Produce your ad: People respond most favorably to user-generated content these days, so use your phone to film your video. Keep it quick, simple, and compelling. Consider giving Snap Publisher a try — it’s easy to use and offers customizable templates sortable by objective.
- Optimize your ad: Optimize your ad for your chosen platforms and target audience, ensuring that it’s being seen by the right people, in the right context.
- Test the ad: Test your ad with a small group of people to get feedback and make any necessary changes before launching it to a wider audience.
- Track and measure performance: Use metrics such as viewability, click-through rate, and conversions to understand your ad’s effectiveness, then make adjustments as needed to continually improve its performance.
Once you’ve created your ad, follow these steps to get it running on the platform of your choice:
- Choose a platform such as Snapchat.
- Define your target audience.
- Set a budget.
- Launch your campaign.
- Track and measure activity and results.
- Optimize your campaign to see consistently improving results.
U.S. digital video advertising spending is expected to climb to $78.45 in 2023. That’s up from $67.16 billion in 2022 — and just $31.86 billion in 2019. (wyzowl - available in English only)³
Investing in video advertising
The amount that a small to medium-sized business should invest in video advertising will depend on several factors, such as the size of the business, the industry it operates within, and the goals of the campaign. A general rule of thumb is to allocate around 10-15% of the overall marketing budget to video advertising.
From there, deciding on how that budget should be allocated depends on your objectives and target audience. Some options to take into account:
- Brand awareness: Invest in pre-roll and outstream video ads to reach a wide audience and increase brand awareness.
- Product or service promotion: Invest in product or service promotion videos that can be used on your company's website, social media platforms, or shared with influencers to reach specific target audiences.
- Interactive and engaging videos: Invest in options such as shoppable videos to increase engagement and drive conversions.
- UGC-based content: For the purposes of using the content in your ads (with permission, of course), encourage your customers and supportive influencers to create relatable, relevant user-generated content that aligns with your target audience.
Businesses should also consider the cost of producing videos, as outlay always varies depending on the quality, length, and complexity of a given piece. It may be beneficial to start with a smaller budget, test the results, and then scale up as needed.
7 Reasons to Run Video Ads on Snapchat
- Young and engaged audiences: Snapchat is home to a youthful, deeply engaged worldwide community, making it a great platform for reaching a younger demographic.
- High viewability: Snapchat's vertical video format, known as Snap Ads, is designed to be viewed in full-screen mode, providing a high viewability rate for video ads.
- Ample targeting options: Snapchat offers a wide range of targeting options, including demographic, location, and interest-based targeting, which allows for more effective targeting of the desired audience.
- Interactive features: Snapchat offers interactive features such as augmented reality lenses, which allow businesses to create immersive and engaging video ads that can increase engagement and drive conversions.
- World-class engagement: Snapchat's Stories feature, which is a collection of videos, photos, and text that are posted by users, has a high engagement rate. This is a good option for businesses to create video ads that can be seen by a larger audience and increase brand awareness.
- Measurable results: Snapchat provides detailed metrics and analytics, which allows businesses to measure the performance of their video ad campaigns and make adjustments as needed.
- Cost-effectiveness: Compared to other platforms, Snapchat is considered to be one of the more cost-effective platforms, making it a sound option for small to medium-sized businesses.