Pre-Roll Video Ad Prices lower due to Increase in Inventory

Traditional TV costs per thousand may still be climbing — but that isn’t the case for digital pre-roll video ads, in part due to increased inventory.

Current pre-roll video advertising — perhaps the biggest piece of the digital video category — is down slightly at $8.18 CPMs from an $8.83 CPM during the first half of 2012, reports real-time video ad platform TubeMogul. The dip occurs when inflation has been bumping along at 2.5% per month.

Most of that is due to heavy inventory, says the company.

The number of daily pre-roll video ads available for real-time buying averaged 331 million ads available per day in October. There has been a monthly inventory growth rate of 7.3% in 2012, says TubeMogul.

Digital video completion rates — an increasingly important measure for digital advertisers — continue to grow with certain formats. Top-level (tier one) sites have the higher competition rates for 15-second commercials. In the third quarter of this year, nearly 85% of viewers now watch an entire ad on top sites. This is up from nearly 82% for the first half of the year.

Research also reveals that watching a completed video means better recall and brand association. There is a 20% rate of message association for those who watch a completed message, versus 8.3% for those who don’t watch a completed video message. General awareness has improved to 6.9% from 3.5%.

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