In the advertising world, there's a never-ending push and pull between consumers and brands. Consumers want content, and will favor ads that don't interfere with their ability to get it. Brand advertisers must work within these parameters, responding to their customers' current preferences while also anticipating their future needs.
This has led to the rise of custom ad formats. Because they're seamlessly integrated into the site page (when implemented well), native ads promise to deliver a minimally disruptive ad experience. According to Business Insider's BI Intelligence, native is expected to account for 74 percent of all U.S. display ad revenue by the year 2021, and native video ads will be "one of the main drivers of this growth."
As brands are spending more on native, though, they're also increasing their investment in programmatic video. Last year, eMarketer predicted that 2016 would be "a pivotal year" for programmatic video in the U.S. They also expected that 56 percent of all digital video ad spending would go to programmatic, to the tune of more than $5.5 billion. We look forward to seeing the final numbers and whether they matched expectations.
It may seem like these two strategies—custom and programmatic—are at opposite ends of the advertising spectrum. Programmatic video leverages automation to streamline the buying process, often focusing less on human involvement. Custom placements, meanwhile, can involve lengthy discussions and individual negotiation sessions between buyers and sellers. Given the disparity between the two, you have to wonder what the future of advertising holds. Both have their advantages. So which will buyers and sellers choose?
They may not have to choose at all, because we're already seeing these two powerful strategies merge. Last July, Google introduced the ability to buy native ads programmatically. Why? Their aim is to provide a better user experience while also creating new opportunities for advertisers and publishers. It's just one of many innovations happening across the industry as we collectively pursue this three-pronged goal.
Nowhere is this truer than with video. Customizing the ad experience isn't just about the site environment, after all, but more about tuning in to your customers and understanding what they're looking for. It's a mindset as much as a tactic, and it can be applied to your video campaigns.
Our video marketplace at Tremor Video already allows buyers to create customized campaigns by matching their objectives to find the right viewer in the right place at the right time. Customization extends to video format selection and interactive creative, too. Our research on millennial consumers shows shorter mobile videos around 10-seconds in length have more brand appeal and persuasion potential for younger consumers, and brand advertisers can use this information to plan their buys. Next up, expect to see an increase in vertical video ads as both buyers and sellers embrace this viewing trend.
The digital environment is constantly evolving, and right now consumers expect an ad experience that feels like it was created expressly for them. Armed with programmatic video and a commitment to customization, you can mitigate that push and pull and take your rightful place in your customers' cross-channel, on-demand world.