Last week Tremor Media, Jupiter, and Break.com announced studies showing that pre roll wasn't dead. 

• Tremor says that pre roll completion hits 80%


• Break says that pre roll completion rates hit 90% with 78% watching at least 15 seconds and click throughs are coming in at about 10%. 


• Jupiter notes that pre roll drop off is about 5% and also notes that natural drop off after 15 seconds is 10%

Then eMarketer
negates their hefty February prediction of $1.4B in online video advertising and halves it to $505M. 

Between these studies, the Olympics and Gemini Division, its been a busy week in the online video industry.  Whew! 

So what does this mean?  Well so far there's four main types of online video monetization:

• Pre-Roll


• Post-Roll / Interstitial


• Overlay


• Surrounding Banners

"We've seen slightly higher completion rates for 30-second ads than 15 seconds," said Tremor CEO Jason Glickman in a statement. "While we wouldn't suggest it as a best practice, it is proof that audiences are willing to accept pre-roll advertising in exchange for the content they want, on demand."

So, obviously if you want to watch something you are going to sit through a 30 second commercial.  Especially long form video, since that's what television has conditioned us to expect.  Want to watch "The Office?"  Sure I'll sit through a commercial.  I got to watch 4 hours of rowing from one measly pre roll....good deal!  Are they effective?  10% click through rate?  I don't really know what Intel has to do with rowing, but maybe there's something I'm missing....

But imagine you heard about Bolt's record breaking 100m.  I'd be kind of annoyed but I'd still endure it, but imagine watching a 15 or even a 30 second pre roll for 9.69 seconds worth of content.  Annoying?  Yes.  Endurable?  Sure.  Relevant?  Probably not.  (Maybe Intel can say something how they are the fastest chips in the world?  But that's stretching it).  And that's probably why 30's are more likely to get watched than 15's. 

Mid Roll is pretty good actually and its what television writers and Dan Brown have perfected.  Create dramatic tension and right when something is about to happen, show a mid roll.  Imagine, the middle of the 4x100 swimming relay:  "And Jason Lezak is catching up to Alain Bernand of France, he's now a few meters behind with 10 meters to go..this could be amazing..And let's show you some messages from our sponsors."  You bet you'll sit through those. 

Overlay Ads are relatively new although we are starting to slowly see them on television.  Scanscout even has a system to place contextually relevant ads within video. 

Post Rolls just don't work.  Sorry.  Revver tried it and look at what happened to them.  Fact of the matter is, why am I watching a commercial after you just gave me the content?  After the show, I'm gone. 

Surrounding Banners and / or custom skinning is a nice way to ensure that your brand is seen ALL THE TIME.  Even when you aren't paying attention to pre rolls you can't help but notice the Dell skinned video player. 

Conclusion:  There's a problem here, and while contextual overlay ads are going to suffer most, it also affects pre/post/mid rolls.  And that problem is illustrated by eMarketer.....there's not enough inventory!  If someone is talking about mortgages in the video, and the mortgage companies are hurting and don't want to incur media buys, that space ends up going to Coke, Intel, Microsoft, or American Express.  Hardly relevant, leading to bad ROI, and possibly having these advertisers pull out of online video. 

We're slowly seeing tools like Miro coming out (Tivo for online video) that at some point is going to make the "roll" family of advertising obsolete.  Overlay ads or something integrated with the content is going to be the future of online video advertising.  So here's what we can do as an industry.  Let's serve up contextually relevant ads, so that our advertisers win because when they win, we win.  Soon, they'll be able to see how effective video is at branding and marketing and with relevancy we'll have a long tail of advertising inventory.  And we'll be able to make those eMarketer numbers.....