Dubbed the “Vungle Exchange,” the technology solves a number of technical challenges associated with in-app video, namely support for HD, high-bitrate, 15-second video ads, improved latency to speed up load times and the connection to server-side technology for adaptive ad formats and creative, Vungle CEO Zain Jaffer said.
“We see ourselves building the infrastructure for in-app video advertising,” he said. “You’re noticing a big trend where companies are starting to make a lot of mobile revenue and that’s fueled by app install ads.”
With mobile app install ads, Vungle has seen traction for its App Trailers format, which help app developers promote apps in their network through 15-second video trailers, Jaffer said. AOL Ventures and others have invested in the company based on developer interest in these formats.
Vungle works with 5,000 app developers, which include Halfbrick (the maker of "Fruit Ninja"), Noodlecake, Zeptolab (the maker of the game "Cut The Rope"), DoubleTap and Limbic. Vungle makes money through a revenue-share model where demand partners are charged by CPM and Vungle takes a cut while its developers, “which act as our publishers,” take the rest, “which keeps our interests aligned with theirs,” Jaffer said.
Jaffer acknowledged the challenge of scaling in-app video in an exchange environment, namely in the form of unlocking inventory and creating effective formats consistent with the user experience.
“People historically have been very sloppy when it comes to implementing video into their applications,” he said. “We show videos in a thoughtful way either as interstitials in natural points within the application or integrated with the app mechanics.”
For example, if you’re playing a game and you hit an obstacle, “you might say, ‘Here, you can revive your character and in return you need to watch a video ad,’" he said. “Implementing video ads carefully results in tremendous scale. Developers are already using our SDK and now this SDK will be exchange-ready.”
Although video inventory has yet to command a majority of mobile in-app revenue, there are upward growth signs. Mobile SSP Inneractive, for instance, saw a doubling in Q1 with demand partners focusing on video (60 buyers executed 800 campaigns, according to the company).
Inneractive, which operates a video ad exchange, enables a diverse set of formats such as 15- to 30-second clips, pre-roll and in-app, full-screen interstitials.
With more mobile app developers opening in-app video inventory, Inneractive launched a feature called AdWatch to tackle issues like brand safety with the ability to monitor delivery paths of ads in real time.
B2B platforms are considering in-app video, too.
Demandbase, a B2B targeting and personalization platform, has just added mobile and video targeting functionality. According to Louis Moynihan, Demandbase’s VP of business development, “within a short period of time we will allow personalized VPAID ads (the IAB’s Video Player Ad-API Definition standard) in exchange inventory. While we have not yet connected to in-app yet, it is absolutely on plan as a mobile strategy by end of year.”
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