Are you struggling to make your retail business stand out? The solution is right in front of you: online video advertising. But it’s not just about showcasing products – it’s about telling a story that truly connects with your audience. With the right approach, you can turn casual browsers into loyal customers. In this guide, we’ll show you how to leverage the power of online video advertising to enhance your retail strategy.
What is online video advertising or OLV?
It’s not surprising to see that ad spending on short-form videos is projected to reach a market volume of USD 145.8 billion by 2028, with an annual growth rate of 10.6%. OLV refers to video ads that appear on websites and apps, strategically placed before (pre-roll), during (mid-roll), or after (post-roll) online video content.
With its dynamic nature and targeted audience reach, OLV offers a prime opportunity for product promotion and brand building through a visually captivating key message. It also uses retargeting tactics to re-engage previous shoppers and guide them along the purchasing journey through strategic ad placements.
Types of online video advertising?
Types of video ads in online video advertising:
In-stream ads
In-stream ads are integrated into streaming video content and provide a seamless viewing experience for the audience. These ads can be categorized into three types: pre-roll (played before the video starts), mid-roll (played during the video), and post-roll (played after the video ends). By aligning with the natural flow of the content, in-stream ads have proven to be an effective form of advertising for businesses looking to reach their target audience.
Out-stream ads
This type of digital advertising video format allows video ads to be displayed outside traditional video players. It helps increase reach and engagement for advertisers and provide more diverse and dynamic ad experiences for viewers.
They include:
- Display ads are integrated into web content and may or may not appear within a video.
- Native ads blend with the website’s content to appear more natural and less intrusive.
- Overlay ads usually appear at the bottom of video content without interrupting it.
Interactive video ads
These ads interact with viewers, offering a more dynamic and engaging advertising experience.
Shoppable video ads
These ads enable viewers to purchase directly from the video, resulting in a more seamless buying experience.
The online video advertising ecosystem is evolving
The online video advertising ecosystem is reshaping the landscape for advertisers, publishers, and users. With this shift comes a surge in the popularity of video ads, presenting unique challenges and opportunities for each stakeholder group.
Advertiser's perspective
Advertisers leverage online video advertisements to increase brand awareness. These campaigns are focused on maximizing traffic and engagement, with a significant portion of budgets for building brand recognition.
Despite its growth, the industry still faces challenges such as absence of a consistent standard for defining viewable impressions. But organizations like IAB (Interactive Advertising Bureau) are establishing benchmarks which require a minimum percentage of the ad to be in view for a specific duration to qualify as a viewable video advertisement. With the right ad tech solution by their side retailers can capitalize on the growing interest in video ads.
Publisher's perspective
Publishers strive to keep up with the evolving video advertising trends. Although major platforms control a large portion of video inventory, open internet publishers are gradually gaining ground. They are actively building video inventory and are experimenting with offering different ad formats for advertisers and are seeking partnerships to distribute video content.
User's perspective
Digital video consumption is rapidly increasing, leading to a decline in traditional media usage. This shift is beneficial for both ad-free and advertising-supported video-on-demand platforms. Emphasizing user experience, the focus is on generating meaningful and interactive content. The industry’s response to user preferences is evident in the growing preference for shorter ads, particularly on mobile devices, and the rising popularity of skippable ads.
As digital video advertising continues to grow, there are challenges to overcome, such as measuring viewability and preventing intrusive or irrelevant ads. However, steps are being taken to address these issues. For example, there is a push for better viewability measurement standards to ensure users see only relevant ads that do not disrupt their online activities.
Additionally, the trend towards seamless and user-friendly advertising environments is at a rise leading to increasing preference for contextual advertising. Which means ads are more aligned with user preferences based on relevance of the content they engage with.
This evolution benefits advertisers by targeting their audiences more effectively, enabling publishers to tap into new revenue streams and enhancing the user experience through personalized content.
Example of online video advertising based on customer journey
Awareness stage
The awareness stage in online video advertising focuses on creating brand and product recognition among potential customers. This is achieved by using attention-grabbing and educational videos that often tell a story or evoke emotional responses to make a strong first impression and increase brand awareness. Engaging and informative video ads are key in introducing the brand or product to capture the audience’s attention.
Metrics to track: ad impressions, video views.
Consideration stage
In this stage, the main video content aims to nurture potential customers and provide detailed information about the product. This includes showcasing how the product solves a specific problem and building a connection with the brand. When creating such ads, retailers focus on creating detailed content with product demonstrations and customer testimonials to help build interest and trust.
Metrics to track: Click-through rates, engagement rates.
Conversion stage
The final stage of video advertising drives action, such as a purchase. This can be achieved through strong calls to action, special offers, or product demonstrations. The content should be persuasive and reassure the viewer of the product’s value. Encourage action by highlighting compelling calls-to-action, special offers, and benefits-driven product videos.
Metrics to track: Conversion rates, sales numbers.
For better results, run all campaigns simultaneously through the same technology partner. This allows for a seamless transition from one stage of the customer journey to the next and provides marketers with valuable data on audience engagement and conversion rates throughout the entire process.
5 Rules for running a successful online video advertising campaign
1. Have a robust advertising media strategy in place
Creating a successful online video advertising campaign requires a strong marketing strategy. This involves utilizing commerce media technology, which uses data and intelligence to target consumers at every stage of their shopping journey. To effectively use commerce media for video, marketers should run multiple campaigns targeting new and existing customers simultaneously.
This approach will guide audiences through each customer journey stage, from discovery to purchase, and encourage repeat buying. In today’s digital landscape, where shopping and social media activities are intertwined, incorporating digital marketing video strategies at every stage of the purchase funnel is crucial for making an impact and driving quick purchase decisions.
2. Think audience first
The first step to building successful video campaigns is choosing the right audience for each objective. Your campaigns will target different audiences and have different key performance indicators (KPIs) depending on where they are in the customer journey. For example, for awareness campaigns, it’s important to reach a large number of customers, but you should also narrow down your audience to those most likely to purchase.
Partnering with an advertising technology platform like FCC can help you utilize and enhance first-party data with commerce data. This provides a comprehensive and 360-degree view of your target audience, including their behavior and purchase intent, allowing you to achieve your video marketing campaign goals.
3. Focus on reach and not format, channel, and device
In online video advertising, the key to success is reaching your target audience wherever and however they consume video content. This means understanding their viewing behaviors and utilizing a variety of channels, platforms, devices, and ad formats to effectively reach them. Have access to a wide range of inventory sources, including premium publishers and streaming services.
To ensure your campaign’s success in reaching your desired audience, leverage a comprehensive video advertising solution that covers all bases – be it social media videos, product videos, or long or short videos. This comprehensive approach ensures that your campaign reaches its intended audience through multiple touchpoints, maximizing its effectiveness.
4. Repurpose and scale your video ads
Producing video creative can be expensive, which deters marketers from launching ad campaigns with OLV media. However, with a well-planned media and video advertising strategy and the right advertising partner, one video can be used to create ads for the entire customer journey.
The initial video should consist of 30-second and 15-second versions for brand awareness across various platforms such as streaming devices, desktop, mobile web, and in-app. As customers move down the sales funnel, your video advertising partner should have various formats incorporating snippets of your video and display elements to drive objectives like conversion, and repeat purchases.
5. Measure KPIs
Tracking the success of your ad campaigns is crucial for measuring business results such as sales, revenue, and ROI. While each campaign may have specific key performance indicators (KPIs), tracking how each campaign moves customers through the purchase funnel is important. For example, suppose a potential customer sees your video ad on an OTT device and becomes part of your consideration audience before purchasing through a conversion ad or organically. In that case, you can attribute that sale to the impact of your OTT campaign.
Your advertising partner should provide attributions and reporting that connects the dots between video ad spending and sales outcomes by tracing the customer’s journey from initial view to final purchase.
Effective KPI metrics are essential for tracking the success of online video advertising campaigns. Some key metrics to consider include engagement rates, click-through rates (CTR), conversion rates (CR), and return on investment (ROI). Additionally, tracking view-through rate, brand lift, audience retention rates, and cost per acquisition is important to gain a deeper understanding of campaign performance.
These metrics can provide valuable insights into factors such as how long viewers watch ads, the impact on brand perception, viewer engagement throughout the video, and the effectiveness of acquiring new customers or leads at a reasonable cost.
Parting thoughts
Video ads are the future of retail marketing. Flipkart Commerce Cloud (FCC) offers solutions for targeted advertising, competitive pricing strategies, and a diverse product assortment to cater to the evolving needs of retailers.
With a comprehensive suite of products, FCC Marketplace Technology Stack offers 40 modular components, including personalization, merchandising, catalog, recommendation engines, seller and order management tools.
FCC’s Ads Manager helps retailers manage display ads, sponsored listings, contextual ads, and end-to-end ad ecosystems with minimal effort and investment.
Additionally, ‘Retail Pricing Manager’ assists retailers in understanding competitive pricing strategies by tracking real-time competitor price changes and using ML models to analyze historical sales data for price elasticity of demand. It also combines game theory to predict customer response to price changes to drive sales with data-driven insights and strategic decision-making.
To know how FCC can help boost your retail media platform sales, book a free product demo!
FAQ
Online video advertising differs from traditional TV advertising primarily in targeting, measurability, and cost structure. Online video uses precise digital targeting (demographics, interests, behavior, search history) powered by first-party data, offers real-time performance metrics like clicks and conversion rates, and is generally more flexible and cost-effective with lower barriers to entry. Traditional TV offers massive, broad reach and often builds higher inherent trust, but is expensive, has limited targeting, and relies on delayed, aggregated audience measurement.
The main online video ad formats include in-stream ads, which play directly inside a video player either before (pre-roll), during (mid-roll), or after (post-roll) the main video content; out-stream ads, which appear outside of video players, typically embedded within articles or social feeds and often start muted; CTV/OTT ads, which are in-stream ads delivered through streaming services like Hulu, Roku, or smart TVs; and social video ads, which are optimized for social feeds like Facebook, Instagram, or TikTok, often using short, vertical formats.
Online video ads are bought and priced using several models that correspond to campaign goals. CPM (Cost Per Mille) is common for awareness campaigns, where you pay for every 1,000 impressions. CPV (Cost Per View) is used to optimize for video views, often charging only if a user watches a certain duration or interacts. CPC (Cost Per Click) focuses on driving traffic to a website, charging per click. Finally, CPA (Cost Per Action) is used for direct response, paying only when a specific conversion event occurs.
You can make online video ads mobile-friendly by optimizing the creative for vertical or square aspect ratios to fill the mobile screen, ensuring all text and visuals are clear on smaller displays, and keeping the length concise to respect mobile attention spans. To make them sound-off ready, you must include clear, readable text overlays, headlines, and calls-to-action (CTAs), and use subtitles or closed captions to convey the full message effectively even when the audio is muted.
Best practices to improve online video ad performance include ensuring the brand and core message are shown in the first 3-5 seconds to prevent skips or drop-offs. The video should also use captions or text overlays to ensure the message is clear, as most videos are watched sound-off on mobile devices. Videos should maintain a clear, singular call-to-action (CTA) and be formatted to suit mobile viewing, such as using vertical or square aspect ratios.
Video ad lengths that work best vary significantly depending on the campaign goal and the placement channel. For maximizing reach and frequency in brand awareness campaigns, 6-second bumper ads are the most effective as they are non-skippable and concise. 15-to-30-second ads are the industry standard for consideration and storytelling across in-stream and Connected TV (CTV) placements, offering enough time to convey a narrative. For high-intent placements on social media feeds and mobile, shorter videos, often 5 to 15 seconds, are recommended to capture attention before the user scrolls past.
Creative best practices to improve online video ad performance include ensuring the brand and core message are visually shown in the first 3-5 seconds to immediately hook the viewer and overcome ad skips or drop-offs. The video must be designed to work sound-off by utilizing clear captions, text overlays, and graphic elements. Furthermore, videos should maintain a single, clear call-to-action (CTA) and be formatted with appropriate aspect ratios (like vertical or square) to suit mobile and social viewing environments.
You make online video ads mobile-friendly by optimizing the creative for vertical or square aspect ratios to fill the mobile screen, ensuring all text and visuals are clear and legible on smaller displays, and keeping the length concise to respect mobile attention spans. To make them sound-off ready, you must include clear, readable text overlays, headlines, and calls-to-action (CTAs), and use subtitles or closed captions to convey the full message and narrative effectively even when the audio is muted, as most mobile users watch video without sound by default.
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