Why Video Advertising Needs to Dump Impressions and Move to 'Cost Per View'

©IDG Communications, Inc. Photo contributed by Matthew Mikaelian.

Video That People Choose to Watch Should Be Treated Differently Than Those Forced on Them

Ad Age, 3/1/11

When a “view” is counted on a site like YouTube, audiences and brands alike know what it means: someone chose to watch a video. Increasingly, there are a proliferation of video ads that capture the same characteristic, from pre-rolls giving viewers a choice of which ad to watch to skippable pre-rolls to in-banner units that viewers click to play.

Despite online video’s massive growth — daily unique video viewers grew 31.6% in the past year, according to ComScore — metrics for pricing and measuring video advertising have not evolved in tandem. The primary way video advertising is bought and sold today is cost-per-thousand impressions (CPM). As Dave Morgan pointed out, CPM pricing in general has its limitations, leading to cross-comparisons that can be misleading, like comparing radio to TV. Online, CPM pricing equates a “clean-forward” video experience with a rich-media or display ad experience, despite proven differences in effectiveness. Further, as different ad formats proliferate in a pre-roll constrained world (e.g. click-to-play video ads) with a variety of pricing models, cross-comparisons can be difficult.

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