Video advertising has become a primary method for brands to connect with consumers, especially as audiences spend more time on streaming platforms. Instream advertising is a significant part of this landscape, acting as the digital successor to traditional television commercials. This format is powerful because it benefits from a user who is already in a focused, video-watching mindset. This article will define instream advertising, explore its forms, detail where it appears, examine its trade-offs, and clarify the metrics used to gauge its success.
Defining Instream Advertising
Instream advertising refers to video advertisements embedded directly within a video player that play sequentially with the content a user has selected. The core characteristic of this format is that it relies on an existing video environment, where the user has already demonstrated an intent to watch a video. This placement leverages the viewer’s established focus on the screen, creating a captive audience for the advertiser’s message.
This format closely mirrors the experience of a commercial break on linear television, often taking over the entire video playing space. Because the ad is served within the content stream, it benefits from high viewability rates compared to other ad formats. Many instream ads are non-skippable, or only skippable after a short duration, such as five seconds, ensuring the advertiser’s message is delivered. This high-quality placement and the user’s intent to watch contribute to instream ads commanding higher Cost Per Mille (CPM) rates than most other digital ad units.
The Three Main Types of Instream Ads
Instream advertisements are classified into three types based on their timing relative to the main video content: pre-roll, mid-roll, and post-roll. This distinction dictates the user experience, the likelihood of ad completion, and the overall value of the impression.
Pre-roll
Pre-roll ads play immediately before the main video content begins, capturing a viewer’s attention when they are most anticipating their chosen video. This placement is often the highest priced because it guarantees initial exposure, reaching the audience before any potential drop-off occurs. They are effective for building brand awareness, though users may skip them after a few seconds if the option is available.
Mid-roll
Mid-roll ads interrupt the video content, appearing during natural breaks in longer-form videos, similar to a traditional television commercial break. This placement yields higher completion rates since the user is already invested in watching the remainder of the content. However, poorly timed interruptions can lead to user frustration and may increase the likelihood of the viewer abandoning the content entirely.
Post-roll
Post-roll ads appear after the content has concluded, playing once the user’s selected video has finished. This is considered the least intrusive type, as it does not interrupt the main viewing experience. Post-roll ads are frequently used for calls-to-action, such as encouraging a subscription or a website visit, or for retargeting campaigns. They suffer from lower engagement and completion rates since many users navigate away from the player immediately after the content ends.
Where Instream Ads Appear
The environment for instream ads has expanded significantly beyond desktop browsers to encompass a wide range of high-engagement, video-centric platforms. These advertisements are commonly found on major video-sharing sites, such as YouTube, where they appear before, during, or after user-generated videos. This environment provides massive reach and advanced audience targeting capabilities based on user demographics and behaviors.
Instream ads are also the standard format within Connected TV (CTV) and Over-the-Top (OTT) streaming services. These placements include ad-supported video on demand (AVOD) platforms like Hulu, Peacock, Tubi, and Pluto TV, where viewers consume professionally produced movies and shows. The ads are also served through digital multichannel video programming distributors (MVPDs) like YouTube TV and Sling TV, which stream live and on-demand content over the internet.
Key Advantages and Disadvantages
Instream advertising provides distinct advantages, primarily centered on guaranteed visibility and high engagement levels. Due to their placement within a video the user has actively chosen to watch, instream ads achieve superior Video Completion Rates (VCRs), often exceeding 90% on CTV platforms. The presence of instream ads on premium publisher websites and established streaming services provides a degree of brand safety and a high-quality viewing context.
The format’s inherent disruption presents several drawbacks for advertisers and publishers. Instream ads often carry a high Cost Per Mille (CPM) compared to other formats because of the premium inventory and guaranteed viewability. Forced viewing, especially with non-skippable or mid-roll ads, can lead to user annoyance and ad fatigue, potentially resulting in a negative brand perception. The success of instream advertising is a delicate balance between message delivery and user experience.
Measuring Success and Instream Metrics
Advertisers track the performance of instream campaigns using specific video performance indicators that measure audience attention and message delivery. A primary metric is the Video Completion Rate (VCR), which calculates the percentage of impressions that played through to 100% completion. VCR directly measures how effectively the advertisement retains the viewer’s attention through its entire runtime.
Viewability standards are used to ensure an ad impression is genuinely seen by the user. For video, the industry standard set by the Interactive Advertising Bureau (IAB) and the Media Rating Council (MRC) defines a viewable impression as one where at least 50% of the ad’s pixels are visible on the screen for a continuous period of at least two seconds. The Cost Per Mille (CPM) remains the primary pricing model for instream ads, representing the price an advertiser pays for one thousand ad impressions.
Distinguishing Instream from Outstream Video Ads
Instream ads are fundamentally different from outstream video ads, a distinction crucial for understanding the digital video advertising landscape. The defining factor for instream is its reliance on an existing video player and an audience that has actively sought out video content. The ad must be inserted into the stream of a video that a publisher already provides.
Outstream ads, by contrast, create their own video player within non-video content, such as embedded between paragraphs of a text article or in a social media feed. These ads are often referred to as in-article or native video ads and typically start playing automatically when they scroll into view, often muted by default. Outstream is used to monetize pages that do not contain dedicated video content, expanding the reach of video advertising.