The Interactive Advertising Bureau (IAB) Tech Lab has introduced a revised set of specifications for video ads, changing the definition of instream and outstream ads as we know it.
This update aims to increase transparency over the video ad buying and selling process, and will impact billions of dollars of advertising budgets and revenue.
But what exactly has changed and why did the IAB change it?
In this article, we’ll explain everything you need to know about the new IAB video ad classification.
New Definitions of Instream and Outstream Video Ads
The new IAB update changed the definition of instream and outstream video ads, the two primary video placement categories.
Prior to the update, the definitions were quite simple:
Instream video ads were defined as ads played within existing content as pre-roll, mid-roll, or post-roll ads.
Outstream video ads were defined as ads played independently and not connected to existing content.
However, this created a gray area (that we will explain more about below), which led to the IAB reclassifying the ad units into four categories:
- Accompanying content
- No content/standalone
Here’s what each of them mean:
Like the previous definition, this category includes video ads that play within the context of a video player, either before, during, or after the primary video content.
However, now instream ads are required to be set to “sound-on” by default.
They also need to exhibit “explicit demonstrated intent to watch the video.”
In other words, instream ads are only considered instream if the user actually went to watch the video the ads are in.
Like instream, accompanying content also serves pre-roll, mid-roll, and post-roll ads. However, accompanying content is situated within editorial content and begins to play when it comes into a user’s viewport.
It is not required to have “sound-on” and doesn’t need to have explicit user intent to watch the video.
This category encompasses video ads that are not connected with any content.
In simpler terms, they are simply video players with ads and don’t feature any content other than the ads.
The interstitial category is for full-screen video ads, whether web or in-app.
Why Did IAB Update the Video Ad Classifications?
The IAB’s new update is to ensure that advertisers are getting the true value for their ad purchase.
Instream ads are one of the most valuable ad formats for advertisers. In fact, they are willing to pay up to 50% higher bid prices for instream ads.
However, due to the amorphous definition of instream ads, there were situations in which advertisers were paying instream ad cost for ads that were served in small, muted players in the bottom corner of the screen.
This created a gray area and a lack of clarity regarding instream ads, and what exactly advertisers are paying for/publishers are charging for.
What the New IAB Video Classification Means for Publishers?
Some DSPs have already announced that starting June 1, 2023, they will not be bidding on inventory that don’t use the IAB’s new classification.
Soon, all other DSPs will follow suit.
This means that publishers that don’t adopt the new changes will lose out on valuable ad revenue.
That is the first takeaway.
The second takeaway is that publishers now have to sell their video ad inventory in a smarter way.
Understanding the intricacies of the new video formats will have a significant impact on the CPMs that you succeed in leveraging from advertisers.
One of the ways to ensure that you are maximizing your revenue potential for video ads is by working with a reliable and trusted monetization company.
Adnimation, a Google Certified Publishing Partner (GCPP) and a Google AdX partner, has years of experience with video ads in particular, and know how to leverage higher prices for each ad.
To get started or to learn about how we can help, feel free to get in touch today.