Advertising is one of the fields that drives so much of the entertainment and publishing fields. It’s impossible to visit an Internet site or watch a TV show without numerous ads popping up, vying for your attention. As the use of mobile devices is increasing, we’re beginning to see that trend follow onto your smartphones, tablets, and all of the screens that fill your life. We’ve written before about the rise of mobile advertisements in general, pushed mainly by the huge amount of growth in mobile devices over the past few years, paired with advertisers’ desire to capture those users’ attention. Mobile advertisement dollars have increased exponentially over the past few years, but no market is quite so poised to take over like that of mobile video advertising.
On top of that, advertisers are getting much better at making it seem like the ads are a natural part of the app you’re using, so they seem like a normal fit, not an abnormality. The rise in quality of those video ads is allowing the industry to grow by leaps and bounds, which is why you’re likely to start seeing more and more video ads on your smartphone, said Gil Shoham, CEO and co-founder of mobile app monetization platform Supersonic. According to Shoham, 82% of the time spent on mobile devices is in apps, not on the mobile web. “Until last year, the advertisers didn’t really capitalize on that opportunity,” he said during a conversation with The Cheat Sheet.
Up until about two years ago, the technology didn’t really exist to host video advertising within apps in a seamless way, Shoham said. Supersonic and competing companies like it have created the programs that allow app developers to integrate advertising in better ways, in multiple instances throughout the use of an app. Video viewers on mobile devices have grown in the past two years or so, making the demand for that sort of content even higher. According to Ooyala, a video monetization and analytics platform, 34% of all video plays in the fourth quarter of 2014 were on smartphones and tablets. December, which had the highest mobile video plays, increased by 114% compared to the year before.
What’s more, Cisco reports that global mobile traffic increased 69% in 2014. Video makes up a huge portion of that, as mobile video traffic grew to 55% of all mobile data usage by the end of 2014. That’s expected to continue growing, with predictions that mobile data traffic will grow tenfold by 2019.
As mobile video becomes more popular, it becomes more natural to see ads in that form as well. (We’ve written that this could be a main reason Verizon bought AOL, since the Internet company has been able to capitalize on video advertising in big ways.) Plus, the video ads within apps have advantages over the video ads that you see on a typical website, Shoham said. For one, the ad fills the entire mobile screen, which means that users have to watch it — they can’t keep scrolling down the page or get distracted by something else on the screen. But what’s an even bigger deal is that mobile video ads can be formatted in a method called “pre-caching,” which means that it loads ahead of time and can play automatically, even in high definition. As a result, the ads are much crisper, Shoham said, and there’s no waiting time for it to load. “The experience for the user is so much better,” he added.
As platforms like Supersonic have made it easier for advertisers and app developers to join together, advertisers have also begun investing more in the video ads that are created. The advertising campaign that Machine Zone created for Game of War – Fire Age featuring supermodel Kate Upton is one example of that, Shoham said. The ads (one of which is shown above) are featured everywhere, including on several other apps on mobile devices. “This is an example of an expensive production that is working. It’s definitely worth the investment,” Shoham said.
The new dedication to video shows that advertisers are putting much more thought into the creative process, meaning that the videos fit better within a mobile framework, are higher quality, and are better received by users. In return, app developers like Electronic Arts (EA) and Zynga are more willing to place ads in their apps. Until very recently, app developers and publishers were very hesitant to show video ads to their users, and tried to make most of their revenue from in-app purchases. But now, they can make additional revenue without sacrificing the user experience, Shoham said. “These app developers — they take user experience very very seriously,” he explained. “They have no tolerance for any experience that doesn’t make sense.”
Shoham said as the industry expands and the demand becomes higher for video ads, changes are happening on a monthly basis that shift how the ads are used, where they appear within apps, and ways to engage users. Because Supersonic works directly with the app developers, the changes to the advertising platform can reflect what developers want to see most, while keeping customer preferences at the forefront. “I think it’s leading us in the right direction,” Shoham said. The bottom line: You’re going to see more video ads when you’re using apps on your smartphone or tablet. But if Supersonic, the app creators, and advertisers are doing their job correctly, it won’t seem like a huge waste of your time.
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