Video AppNexperts: An Interview with AppNexus SVP of Video Technology Eric Hoffert
Welcome to our Video AppNexperts Series! In each new edition, a different AppNexian will tell you about their work with video and provide tips for how publishers and advertisers can use the medium more effectively. This week, we talked to Senior Vice President of Video Technology Eric Hoffert.
1. Can you tell me about your time working on programmatic video?
Generally speaking, I’ve been working on digital video for more than 25 years! I led the creation of Quicktime video compression at Apple, served as Video Architect at Spotify, worked as CTO at JW Player, and have consulted on video platforms at VICE Media and Disney. But I didn’t get started full time with programmatic video until I started working with AppNexus in May of 2015 – an effort which led to AppNexus entering the programmatic video market.
For many years, the story of programmatic video has been one of incredible but unrealized potential. Programmatic video seemed like it should be an easy win for publishers and advertisers – people love to watch video online, and programmatic enables publishers to monetize that attention effectively while also helping advertisers to reach their audiences through a highly-engaging medium.
That sounds great in theory, but in practice, programmatic video has faced challenges. Many of these stem from the fact that producing quality video at scale is expensive and time-consuming. Few companies can do it, so there’s a constrained supply of premium video inventory, which means that publishers can price that inventory higher and limit access to select buyers. That market landscape created both motive and opportunity for bad actors. As ad budgets for digital video went up, we saw industry-wide increases in fraud on programmatic video transactions – for example, in the form of domain spoofing schemes and non-human video views.
There have also been inventory quality concerns with programmatic video. Notably, YouTube faced controversy when advertisers saw the extreme, hateful content people were able to monetize on its platform – it’s a challenge they still seem to be facing today.
But the encouraging part here is that, after a transformational period working through these challenges, programmatic video is now poised to enter a golden age on the open internet, with a focus on brand safe, highly viewable, engaging, premium, and multi-screen supply. Many of the challenges of the last five to ten years are being addressed, allowing the industry to move forward and to realize the powerful potential for programmatic video. The timing for these changes is optimal, as internet users are spending more and more time each day consuming digital video, meaning programmatic video ad spend continues to rise.
2. You talk a lot about building a better video internet at AppNexus. What does that look like?
I think the narrative of programmatic video not living up to its potential is finally starting to shift as we address many of the challenges I just described – solving those issues has been one of my biggest priorities leading video engineering here at AppNexus.
So, how do you bring more high-quality, brand-safe inventory into the programmatic video marketplace? At AppNexus, we’ve found that a key strategy is to form direct relationships with top video publishers and broadcasters around the globe by supporting them with best-in-class video technology. We’ve recently signed deals with several of the largest media companies in the world, as well as several of the internet’s highest-traffic web sites who make the most use of video content. These publishers are directly connected to our video marketplace, so when people buy their inventory on AppNexus, they know they’re getting the real thing. When buyers don’t have to worry about the veracity of the inventory they’re purchasing – something that should be table stakes in our industry – they’re free to shift focus to hitting the right audience, refining their creative messaging, and everything else that goes into building a successful video campaign.
Beyond that, we’re also blocking sites that don’t meet our inventory quality standards and removing unauthorized resellers from our platform – the ads.txt initiative has been a crucial help there. Similar to our direct publisher integrations, the goal is to give our clients confidence that when they buy video through AppNexus, they’re getting exactly what they’re paying for.
We’re also working to ensure that programmatic video ads enhance the user experience rather than diminish it. In fact, we see this as one of AppNexus’ key competitive advantages when it comes to video. Thanks to our global infrastructure and high-performance platform, we have one of the lowest video ad response times in the industry – under 150 milliseconds on average – which greatly reduces any video buffering users have to sit through when viewing ad-supported video streams. We’re also striving to eliminate back-to-back video ads, removing buyers that add latency to video by running secondary auctions, and enforcing quality standards for high definition video creatives running on over-the-top (OTT) services streamed to connected TV (CTV) devices.
3. What’s coming next year for programmatic video?
I think the most exciting developments have to do with the ongoing rise of OTT and CTV. By now, everyone knows about cord-cutting – more and more people are transitioning from cable and broadcast TV to streaming services that deliver their favorite shows to the device of their choosing – in many cases an HD television. But that trend is only just beginning. Now that live, mass viewing events like sports are available to stream, we expect even more people to make the switch. And when they do, advertisers will be primed to reach them with high-quality video ads thanks to programmatic live streaming. This is a huge development. Video advertisers can now reach users directly in their living rooms when they’re at their most engaged – previously, that was only possible through broadcast TV.
In order to help advertisers take full advantage of this mega trend, we’re working on audience targeting, measurement, and attribution technology that works for the big screen in the living room. We ‘ve started doing this for CTV devices through our partnership with Tru Optik, but that’s just one piece of the puzzle. We’re also developing a unique technology platform called AppNexus Programmable Data (APD) that allows large-scale audience datasets to be uploaded with automatic buy-side matching to audience segments, enabling video ad campaigns to target specialized audiences on CTV devices.
All in all, AppNexus’ approach to video is similar to our strategy for programmatic in general. We want to optimize yield for video publishers, reach desirable audiences for video advertisers, and ensure video experiences are great for users. If you want to learn more or get involved, you can contact us here.