Over the last few years, the popularity of advertising video-on-demand (AVOD) services has been increasing rapidly. With the prediction of Deloitte Global that almost two-thirds of consumers in developed countries will use at least one AVOD service monthly by the end of 2024, the trend is likely to continue.
Moreover, by 2030, the majority of online video streaming subscriptions are expected to be partially or wholly ad-funded, catching up with emerging markets where ad-funded video-on-demand is the usual norm.
The rise of AVOD can be attributed to several factors, including steep inflation rates eating up income gains for many consumers. Many streaming video services in developed markets used to offer ad-free experiences as part of the benefit of a subscription, with the expectation that viewers would never return to ad-supported services.
This subsequent change has been quite impactful in its way!! You might be wondering how you can leverage all of it ??
Then, let me tell you..
It is observed that in this growing demand, there has been a steep increase in premium productions all over the world, which is in part because of ready-to-use available technology.
YES.. Really it is!
As people have become accustomed to being at home most of the time, the OTT revenue model or over-the-top platforms responded to the increasing at-home media usage. Also, popular revenue channels just like Ad-supported Video Streaming Revenue on Demand or AVOD are one among the important models that will work for operators and is an excellent way to monetize your VOD platform. And, of course it is said to be a master-striking monetization strategy amongst others.
Now let’s look into the..
Overview of VOD or On-Demand Content Platform
What is VOD? Video-on-demand is a type of content distribution platform that offers viewers the ability to opt for how, when, and where they see media. They just have to click on a link and begin watching a video.
Video-on-demand has some basic advantages like it lets viewers view the content at any time – consumers can play content whenever they like. Users can control what they watch and have extra opportunities to select what they see, in comparison to conventional TV scheduling. When all this is combined, top VOD platforms offers audiences the complete freedom to see content in a user-friendly, convenient and reachable way.
– a few of which you use every day. It has become more valuable than before in the current COVID-19 pandemic scenario.
AVOD Meaning – What it Really Is?
What is AVOD? Advertising-based video on demand or Ad-based revenue model is a kind of service where consumers have to view ads for free to watch the actual content that they decide to watch. When you’re looking to simply put it, the most popular form of AVOD or to name an example of AVOD talks about YouTube, DailyMotion, MX Player, etc. AVOD is mostly useful for people with a big fanbase or focused audience since ad views offer minimal amounts of investment & acquire massive volumes of actual revenue.
There has been growth in AVOD in 2021 and more is expected in 2024. The pandemic has a positive effect on the on-demand streaming industry. As a matter of fact, more broadcasters are acquiring vast scope to bring in something new to audiences.
Indeed, this trend has been rising throughout putting the growth drive into high gear despite COVID-19 pandemic implications in other industry streamlines.
AVOD Business Model
AVOD (advertising-based video on demand) business model is based on generating revenue via advertisements. This highly used model has three key players: content creators/publishers, advertisers, and audiences/viewers. Let’s take a closer look at each one:
We all will agree that content creators and publishers are the backbone of any AVOD business model. They are the ones who put all the effort into creating high-quality content that attracts end-users and advertisers. The more the content gets the views, the more revenue it generates for the publishers through ad revenue, thereby creating a mutually beneficial relationship.
Advertisers are another crucial player in the AVOD business model. They pay publishers to promote their goods or services to an audience that is truly interested in what they have to offer. In this case, advertisers completely rely on publishers to ensure that they reach the correct audience, which can then be converted into a paying customer.
The audience is critical to the AVOD business model as they spend their valuable time watching the content. When viewers view ads, advertisers pay for their attention. Here, viewers become a prominent point of attraction for both parties. As a result, creating a positive user experience for the audience is critical for retaining their loyalty and attracting new advertisers to the platform.
Various Ad Options for your AVOD Businesses
AVOD, or Advertising-based Video on Demand, is an innovative and fast-growing business model that allows users to access video content for free in exchange for watching ads. As this model benefits both advertisers and content providers, it has become an increasingly popular strategy in the online video streaming industry.
1. Video Ads
When it comes to AVOD, it becomes essential to provide various types of video ads to attract different types of advertisers and target audiences from various geographical locations. Indeed, offering different video ad formats can help businesses meet the needs and objectives of advertisers while providing a better experience for the audience.
2. Pre-Roll Ads
Pre-roll ads are an excellent option for businesses as they ensure that viewers will see the ad before accessing the content that they are very much eager to watch. Pre-roll ads are highly effective in capturing the end-users attention, especially when they are a bit relevant to the content that follows after the advertisement.
3. Mid-Roll Ads
Basically, Mid-roll ads are played during the online video stream, in the middle of the content. They are highly effective because they appear at a point where the end-user has already gone deep into the content, making it more likely that they will continue to watch and finish the advertisement. In short, due to content curiosity, the end-user will definitely watch the advertisement till the end.
4. Post-Roll Ad
When it comes to post-roll ads, the ad is played at the end of the video stream, and is a good option for advertisers looking to maximize engagement and ensure that viewers watch the entire ad. Post-roll ads are displayed after the content ends, making it more likely that the end-user will watch the entire ad before moving on to the next piece of content.
In conclusion, we can say that by providing a variety of video ad formats, AVOD businesses can attract advertisers and provide a better user experience for the audience. By understanding the different types of video ads available and their respective benefits, businesses can choose the right video ad formats that meet their needs and objectives.
Great.. You must be musing about..
Why Choose Advertising Video On Demand (AVOD) For Your Streaming Business?
AVOD is completely free, which makes it extremely accessible to any kind of audience. Advertisers all around the world want to implement this monetization model since it helps them to get their brands in front of a large number of people and build brand recognition. As a result, AVOD proves to be naturally the best alternative for advertisers trying to reach customers directly.
Now, customers are looking for sports broadcasts, television shows, and other forms of content. The AVOD sector, in particular, has seen fast expansion and spreading out across numerous markets worldwide. The markets across Europe and Latin America appear to be the most interested in AVOD.
Let us discover what makes AVOD or Ad-based model a #1 recommended option for video monetization platform.
What Are The Benefits Of Using Advertising VOD Platform?
Here are some reasons why AVOD is an ideal choice for advertisers, wanting them to approach their consumers directly.
1. High-level User Acquisition Creates A Room:
As it’s a free model it is hugely attractive to a wide range of audiences. Though a lot of people are willing to pay subscription fees for high-value content, a lot more will be available to consume it if they can see it for free.
2. Optimum Revenue Source Is A Plus:
AVOD has outstanding potential for platform owners & advertisers as both can gain maximum traction of digital ads, leading to profit perks since they are on demand currently.
3. Forecasts Indicate Huge Scope for Broadcasters:
Subsequently, insights from Global video ad expenditure let us know that it is expected to rise revenue & reach nearly $36 Million by 2025.
4. Customization of Ads Gears Microtargeting:
With personalized advertising, advertisers are better placed with their target audience. This aids them in making more sales and enhances the user experience.
5. Variety of Ad Video Formats:
Advertising formats in AVOD comprise display banners, sponsored content, and other streaming ad creations like binge and pause ads. That’s because streaming platforms and ad collaborators are increasingly making ads more appealing to consumers.
Having said that, it’s an ideal time to take advantage of this advancing trend and of this advertising-based business model.
How AVOD Works In Insertions – CSAI & SSAI?
Basically, Ad-based revenue models can be leveraged in video streaming business with two major ways. One with the other from CSAI vs SSAI. While talking about the CSAI or client-side ad insertion solution, it works through an application which sends API requests to the ad server, for it to serve or deliver ad streams.
Then, when we look into SSAI or server-side ad insertion, we come to know that it stitches or inserts the ad media directly to the main video stream, thus eliminating the need for a server request to receive adverts.
Let’s explore both of its intricate functionality..
Client-Side Ad Insertion
CSAI is the process of sending ads to clients via mobile, gaming consoles, desktop, etc; in which the client-side player requests the ad-server for the advert during the time it reaches the particular ad-markers in the stream or manifest file.
When the server receives a request at the client’s-side player, it makes use of the data to know which is the suitable ad to cater to that particular client’s player. Then, it responds with the information of the ad. After that, the player automatically pauses for a bit in the middle of the video. Followingly, the ad gets played and then the video resumes.
Server-side Ad Insertion
SSAI – also referred to as DAI or Dynamic Ad insertion is an insertion technique whereby media (video and audio) are put on directly into the video that is currently being streamed – at the server in cloud but not at client’s server on-premises.
Moreover, in SSAI, the CSAI is quite different from SSAI to facilitate ad insertion. Since it’s a popularly chosen top video monetization platforms amongst top brands, currently SSAI is preferred than the other one.
AVOD – How Is It Different From Other Revenue Models?
AVOD can be a perfect option for content creators and platform owners to monetize their content, since it can be sailed through while investing to have lump sum returns. In order to profit immensely, an AVOD model does not require to create or sell a product outright.
Instead, space in your video is simply offered up to companies for running an advertisement. This gives you an extremely simple and hands-off method of monetizing content in a jiffy.
Now you must be thinking if given a chance, which would be the best option to monetize? Is it SVOD, TVOD & PVOD??
If you ask me, you can explore two ways of monetizing your top AVOD platform. One is, you could combine PPV(TVOD) & PVOD, and SVOD platforms to facilitate your viewers with a general subscription service & charge extra for premium gated content. Or, you can also try having a combination of instream-ads injected into subscription videos for viewers choosing monthly subscription. Besides that, if you want to also utilize all three, that’s also a way!! Ultimately, it’s up to you to decide to leverage pay-per-view in livestreams, throw skippable ads for good measure!!
Ofcourse, there’s a question coming up in your mind!
Why is VOD supposedly held as suitable revenue monetization compared with the rest??
Then, let me tell you how it evolved.. VOD began with movies. Users turned to streaming platforms such as Netflix and VOD services that were linked to cable subscription accounts instantly. As people have become accustomed to being at home most of the time, the OTT revenue model or over-the-top platforms responded to the increasing at-home media usage.
To add to this growing demand, there has been a steep increase in premium productions from all over the world, which is in part because of ready-to-use available technology.
Get to know the other types of monetization models that you can explore:
SVOD – What is subscription video on demand, the money-generating model and the most common type of VOD services provided by media companies presently. It’s a type of service that gives users access to a whole video library for a small repeated fee.
TVOD – Pay-Per-View or TVOD is a transactional video on demand service that lets you purchase content on the basis of, as the name suggests, viewing each content as your consumers pay.
PVOD – No wonder why 55% of Americans use Netflix or alike where a billion hours of streaming is done per week. Premium video on demand, lets you simultaneously strategize broadcasts just before the theatrical window comes up.
Instances When a Streaming Business Can Monetize with AVOD
AVOD usually connects with paid or free aired content to generate surplus revenue that boosts your business as compared to others. For example, PPC or getting paid per click is a great way to get in money from your blog. Google will go look for advertisers or deal directly with companies searching to spend money on advertising.
AVOD is a great option as an advertising-based revenue model for all else except new content, famous blockbuster movies, and popular content of which a famous celebrity is a part.
AVOD business model is extremely well-suited for content providers or operators who have a broad variety of content like TV content, catch-up content and influencer content like vlogs from celebrities which appeal to the youth of today.
AVOD is super good for content aggregators who have a great deal of content pouring in from varied sources, and super great for broadcasters who have new and saved content.
AVOD is well-suited for free-to-air channels on TV that can offer an optimal revenue stream. Some kinds of content are more suitable for AVOD like lengthy content and old movies as there is adequate time to show ads as a part of the whole package to make fair the cost.
Operators in a zone where Disney+, Netflix, Apple TV, and Amazon TV app are seizing market share, AVOD may be what you are finding to offer an extra revenue stream. AVOD is a service that generates free traffic and the excellent advantage to providers is its ability to gather user information which can be used to improve an SVOD offering.
If You Already have an idea about launching a Video Monetization Platform, Schedule a free demo and We’ll Get You On The Road To VOD Streaming Success!
Frequently Asked Questions (FAQ):
Advertising Video On Demand (AVOD) is a sort of service in which users have to watch advertisements in order to view the content they want to watch for free. Like many other advertising models, the primary goal of AVOD advertising is to generate revenue from streaming content.
AVOD is just one of the several viable ways to monetize on-demand videos. The primary goal is to provide free viewership. AVOD monetization is a low-risky method of earning handsome revenue. Here, publishers can attract more and more diverse advertisers. Overall, AVOD streaming benefits all parties in a great way.
Consider the following factors for choosing the right platform provider – Your intended audience, the level of privacy & security you may require now or in the future, the type of content you wish to deliver, etc. You should also consider other video on demand advertising models before coming to a conclusion.
In general, the AVOD monetization model is highly sought-after by advertisers as it allows them to put their brands in front of a large number of users and build brand recognition. That is why AVOD advertising becomes an ideal choice for advertisers in every single situation. As a content creator, AVOD is a terrific strategy if your videos get a lot of views.
The AVOD monetization strategy is used by some of the most well-known video streaming providers out there. When it comes to prominent and well known examples, the names include – YouTube, Instagram, Dailymotion, MX player, Roku, Pluto TV.