Google has a new ad unit out called True View. It’s used on YouTube.
True View allows the video ad to be skipped by the viewer after five seconds. Because the viewer isn’t mandated to watch the entire commercial, it can be as long as the advertiser wants. Or, as long as the viewer finds it interesting.
The advertiser only pays for the commercial if the viewer watches it for thirty seconds. The advertiser doesn’t pay if the viewer leaves after five seconds.
Tod Sacerdoti, the CEO and founder of Brightroll, examines the value of True View in an article that you can access here. But for those of you in a hurry, let me highlight what Tod had to say.
True View definitely offers value to viewers. After all, viewers are not forced to watch a commercial. They can get right into what they came to YouTube to watch. Saving time certainly offers value to viewers.
So you probably won’t be surprised when I tell you that more than 80% of viewers choose the option of skipping the commercial after five seconds.
Does that mean that True View offers little value to publishers? Mr Sacerdoti says “no”, for two reasons. The first being that True View generates comparable CPMs to linear pre-roll ads. And second, the 80% skip rate means that publishers lose less viewers as a result of showing the ads. Data suggests that 25% of viewers leave the page when they see a pre-roll ad pop up. So, True View reduces this churn.
How about value to advertisers? Mr Sacerdoti says that remains to be determined. If the creative is compelling, or, longer than thirty seconds, then Mr Sacerdoti says True View can work very well for advertisers.
All that’s true. But where I disagree with Mr Sacerdoti is that I think True View offers immense value to advertisers. Why?
In a nutshell, it allows them to hold their creative agencies accountable.
How it works is this. After five seconds an advertiser knows whether or not an interested party has chosen to stay involved with the commercial. The advertiser has paid his agency to create a commercial that captures the viewers’ involvement. Google can now measure how long they stay involved for.
Let’s say the advertiser tells his agency, I’ll pay you based on output rather than effort for creating this commercial. And the output I’ll pay you for is viewer involvement (rather than sales). In other words, rather than paying for how long the agency works on the commercial to create it (effort), the agency gets paid for how long the viewer watches it for (outcome).
The longer viewers stay involved with the commercial, the more the agency makes. Of course, the opposite would also hold true.
This would allow the advertiser to hold his agency financially accountable for delivering what the commercial first needs to do before a sale can be made.
Hold the viewer’s attention.
The more of the viewer’s attention a commercial holds, the more the commercial should be worth to the advertiser. So, the more it should be worth to the agency that created it.
It’s why I think True View offers a win/win/win when it comes to value.
For viewers, it’s a definite win as it saves them time.
Publishers win because they can still sell on a CPM basis without creating irritating interruptions for their viewers. They still get their cut.
And advertisers win because for the first time they get what they have always said they wanted – creative accountability.
But the biggest benefactor of all?
Well, that would be Google. After all, they will now have new data – view duration data - that they can monetize and sell to advertisers.
And, I would bet they can sell it at a pretty hefty fee.
I mean, impressions, which are fleeting and, for the most part, unaccountable, go for around 2 cents an eyeball ($20 CPM).
I would have to bet that an advertiser will pay a lot more for accountability.
My guess is $50/sec.
And, that’s probably low.