Digital MarketingVideo MarketingOffline video ads are a revenue opportunity most video providers are missing

Offline video ads are a revenue opportunity most video providers are missing

Forrester found that two-thirds of Americans don’t mind watching ads accompanying free content, and 72% would rather watch video content containing ads than wait longer for ad-free content. Ad-supported video on-demand (AVOD) providers are finding a new revenue opportunity to contrast subscription services: offline video ads.

Would you rather watch a new episode of your favorite TV show on your phone or tablet right now with ads, or wait a few days, dodging internet spoilers, until it’s available ad-free? Chances are, you answered watch it right now. But now imagine that endlessly buffering ads make the video nearly impossible to watch. You’re probably pretty disappointed–and maybe a little miffed at those brands that ruined your video.

In the past, subscription video-on-demand (SVOD) providers have had an opportunity that ad-supported video-on-demand (AVOD) providers have not: the ability to let audiences download content so they can watch without lag or buffering. But offline video ads are changing the game–allowing AVOD providers to give audiences ad-supported video content to view at their leisure.

Content produced in collaboration with Penthera.

Viewers don’t mind ads. It’s the wait they hate

As more and more SVOD services are introduced to the market, creating a streaming price war, AVOD providers have the unique advantage of offering content that’s absolutely free. And while the generally accepted knowledge has been that customers are happy to pay $10 a month to multiple service providers for ad-free video, the truth is that most consumers are also happy to watch ads as long as they’re relevant and load quickly.

A recent study by Forrester found that two-thirds of Americans don’t mind watching ads accompanying free content. Furthermore, 72% would rather watch video content containing ads than wait longer for ad-free content. What users hate are ads that lag or take forever to buffer. Penthera has found that 88% of viewers are frustrated with streaming, up from 81% in 2018.

A mobile download feature could be the solution

So what can AVOD providers do to make sure viewers are seeing ads in a way that doesn’t cause frustration? Give viewers the option to watch video, especially mobile video, offline with a download feature. Allowing all content, including ads, to fully download before audiences watch can remove the challenge of slow-loading, endlessly buffering video that can cause many to walk away from your content–and your ads.  

Offline video ads are a revenue opportunity

It doesn’t make a lot of sense to offer free content that can’t be viewed. And repeated attempts to view content that simply doesn’t work could lead to a decrease in loyalty to video platforms. However, ad-supported video download presents a huge revenue opportunity for AVOD providers. If they enable viewers to watch content offline, AVOD providers can ensure no money is left on the table. Downloading has become a solution that viewers rely on to watch their favorite SVOD content seamlessly, solving some of their most persistent frustrations. But downloading can also translate to immediate additional revenue for AVOD providers since users will be able to watch content and ads when and where they want.

Industry analyst and thought leader Dan Rayburn wrote a pretty compelling projection of the potential revenue download for AVOD could generate. According to Rayburn:

“If an AVOD service has 10M subscribers and 25% of them download one 30 minute video per month. With an average ad load of five ads per show, at a CPM rate of $20, that’s an additional $250,000 in ad revenue per month.”

His projection is based on users downloading once a month, but Penthera has found, by looking at the data across its network of clients who offer a download feature, the numbers are likely much higher.

But timeliness is a factor

But offering offline video ads presents a new set of challenges. There’s no point in serving an ad to a client, having them download the video, and then view the offer well past its expiration date. A good offline video ad feature will dynamically insert ads, regularly refreshing them in the background to ensure the ads viewers watch are always relevant.

“Click heres” are the new click-throughs

One area where it would seem online videos have the upper hand are click-through features that not only provide viewers an opportunity to gather more information about the products and services they see featured in ads, but also provide marketers with valuable insights into video performance. Historically, one concern about offline video ads has been that there was no way to tie ads seen to revenue increase.

Until now. Offering viewers the ability to “click here” while viewing videos offline can be every bit as effective as offering the ability to click-through. Click heres allow users to mark the video content that interests them. Then once they are back online, viewers get a notification reminding them that they expressed an interest in the content of the ad, and that notification directs them to the appropriate landing page, website, or App Store.

For more information on how you can increase your revenue with offline video ads, download Penthera’s white paper “How AVOD Providers Can Finally Offer Mobile Download.” 


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