Are In-Stream Video Ads Worth the Investment? [Benefits & Best Practices for Marketers]

It should come as no surprise to us marketers that short-form video was the top performing content format in 2024. As video content overtakes text-heavy content formats — whether in the form of live streams, YouTube videos, or Instagram Stories — marketers must include a plan to use in-stream video ads in their strategies.

I’m sure you know already how effective the combination of video and marketing tactics can be. In-stream ads provide the opportunity to get your brand in front of your audience when they’re already consuming content.

Using the right combination of tactics — like a strong hook, compelling message, and visually exciting creative — will increase the chances of viewers engaging with your ad. But it also helps to have the right data. Below, I want to break down the basics of using in-stream videos as well as some successful tactics marketers have experimented with.

Table of Contents

• What are in-stream ads?
• Benefits of In-Stream Video Ads
• Types of In-Stream Ads
• Best Practices for Using In-Stream Video Ads

What are in-stream ads?

An in-stream video ad is a promotion created by a brand that runs before or during a video on a streaming platform, such as YouTube. Aside from appearing in popular videos, these ads can also appear in Stories or live streams on platforms like Instagram and Facebook.

To give you a visual of what an in-stream ad looks like, here’s a screenshot of a Chewy Pharmacy ad that appeared during a YouTube video I recently watched:

Benefits of In-Stream Video Ads

When done right, there are a handful of perks to in-stream advertising. To find out exactly what the benefits are, I asked video marketing experts for their insights.

Ad Sequencing

According to Maria Harrison, the President and Co-Founder of Bullseye Strategy, the digital agency of record for The Corcoran Group, one benefit of in-stream video ads is that they allow ad sequencing. This is a powerful tool that allows marketers to control the order in which viewers see a series of video ads.

“This creates a cohesive narrative or story arc to engage audiences, enhancing brand recall, message retention, and user engagement,” says Harrison. “Ad sequencing can drive a deeper sense of engagement and affinity for a brand due to our ability to bring a brand to life through a relatable story for the target audience. These ads can truly allow prospective customers to envision themselves as part of the story being portrayed in the ads.”

Targeting Capabilities

Your video can be targeted to audiences similar to your brand‘s or can be placed in videos that match your ad’s keyword. With these types of targeting options, you can present your ad to viewers that match your audience’s demographics or interests.

Because these viewers might have similar interests and purchasing motives as your customers, a well-targeted in-stream ad could ultimately result in a higher chance of purchases.

Attention-Grabbing

Another benefit of in-stream ads is they command attention in a way other ad formats can’t.

“In-stream ads grab attention because they’re impossible to ignore,” says Justin Belmont, CEO of digital marketing agency Prose. “They’re perfect for storytelling, brand building, and driving quick actions like clicks or signups.”

Short-Form

Another perk of in-stream ads is that these videos don’t need to be incredibly long or detailed. Depending on the platform you use, you can often launch ads as short as five seconds.

While this gives marketers a limited amount of time to grab a viewer‘s attention, it also means they’ll need to produce less content than they would for a long-form marketing video.

Want to quickly create a video ad from existing content? Use Clip Creator to turn text into professional video content with just a few clicks.

Increased ROI

Aside from length and targeting capabilities, the last and most obvious perk of in-stream ads is their ROI potential.

Harrison shared with me the incredible results of an in-stream video ad holiday campaign her team created for The Corcoran Group using YouTube Video Ads and YouTube Select Reserve.

“The campaign focused on warm, inviting, and aspirational messaging, showcasing the joy of finding the perfect home during the holidays,” says Harrison. “This approach resonated strongly with the audience, driving a 198% increase in direct-to-site visitor sessions and a 48% increase in primary conversions (direct) year-over-year during the three-week campaign.”

Sounds great, right?

Although the perks above might have you ready to invest in in-stream ads, there are still a few things you’ll need to research and keep in mind.

Types of In-Stream Ads

Even though in-stream ads are shorter and can be spoon-fed to your audience with ad targeting tools, your content will still need to convince those viewers to click on the ad‘s link and buy your brand’s product. That’s why it’s important to consider the type of in-stream ad that would work best for your campaign.

Here are the most common in-stream ad types:

• Skippable ads. These ads can be skipped after a few seconds.
• Non-skippable ads. These ads cannot be skipped, and the viewer is forced to watch the entirety of the ad before their chosen video continues to play.
• Bumper ads. Video ads that are six seconds or less. These cannot be skipped and are played before, during, or after a video.
• Pre-roll ads. Ads that play before video content.
• Mid-roll ads. These ads appear midway through a video, usually at natural intervals.
• Post-roll ads. Ads that play after the main video content.
• Interactive video ads. These ads have interactive elements such as polls or clickable buttons.
• Overlay ads. Ads that appear as a banner or graphic overlay at the bottom of the video content.
• Shoppable video ads. Ads with integrated e-commerce features, allowing viewers to click and purchase directly from the video. An example of this is the Chewy Pharmacy ad I shared earlier in the article.

Here’s an example of an in-stream video ad from Airbnb that’s both skippable and shoppable, as shown by the CTA buttons:

The type of ad you choose will determine your overall messaging and content. For example, if you create a skippable ad, the primary message must be delivered within the first few seconds.

“Non-skippable ads allow us more time to build the story within the ads,” says Harrison. “Though they may frustrate a user who is eager to reach their chosen content.”

Best Practices for Using In-Stream Video Ads

As I’ve laid out, there are solid pros and cons to in-stream advertising. While the cons shouldn’t scare you from trying this marketing tactic, you should still keep them in mind in order to create a video that can avoid constant skips from your audience. Here are a few tips to keep in mind.

One challenge is keeping viewers engaged long enough to recognize the brand and be attentive to the message.

We address this by using exciting or interesting visuals designed to grab the viewer’s attention quickly. It is critical to deliver the core message within the first few seconds of the ad before they have the chance to either skip it or mentally disengage from it.

Another challenge is finding qualified audiences — in the case of The Corcoran Group, qualified home buyers. We overcome this by cross-referencing audience attributes, such as demographics, behaviors, and interests, to ensure we are targeting those most likely to take action. Additionally, we rely on constant testing and refinement, analyzing performance data to optimize creatives, messaging, and targeting for the best results.

Focus on the hook.

Based on what consumers told us, you have anywhere from one to five seconds to grab your viewer‘s attention before they zone out or skip your ad. You’ll rarely have more than 10 seconds to sway them.

“People usually skip ads if they find it boring, irrelevant, or too long,” says Gerti Mema, marketing manager at Equipment Finance Canada. “We address this by keeping the message short, immediately sharing the value the viewer can benefit from.”

So, begin your ad with an action-packed scene or concisely explain your product as quickly as possible. Don‘t take time to get to the point — even if the ad platform you’re using allows a 30-to-60-second video.

Refine your target audience.

Audiences will either skip your ad because they just don‘t want to see a commercial, or they’re bored by your content because it isn’t relevant to them or the video. This is why it’s important to create ads that are hyper-targeted to your target audience and focus on a brand-related topic they value.

“One challenge of in-stream ads is finding qualified audiences — in the case of The Corcoran Group, qualified home buyers,” says Harrison. “We overcome this by cross-referencing audience attributes, such as demographics, behaviors, and interests, to ensure we are targeting those most likely to take action.”

Use examples as inspiration.

Luckily, millions of brands have already tested out in-stream advertising. While this means the pool of advertising could be competitive, it also means that there are plenty of effective ads out there that you can watch for inspiration.

In my experience as a marketer, if an ad gets me to pay attention, then I know they’re doing something right.

Next time you‘re watching a video that begins or features an in-stream ad, watch the content. Take a mental note of why you do or don’t want to skip the ad. If you’re considering engaging with the ad and tapping to learn more about a product, ask yourself, “How did this content persuade me to click?”

Always test and refine your message.

Like any advertising strategy, you constantly test and analyze your in-stream video ads. Take a look at performance data and break down your creative, messaging, and targeting to optimize your ads for the best results.

“We always test different versions of the ad to see what connects best with our audience,” says Mema. “Messaging that feels personal and relatable can encourage viewers to take action and make sure to incorporate the action pages seamlessly into the ad.”

Getting the Most Out of Video Stream Ads

What I like most about in-stream video ads as a marketer is that they’re an opportunity to get in front of your audience when they’re already engaged.

To get the most out of your video stream ads, I suggest starting by figuring out which type of in-stream ad would work best for your product, message, and audience. Then, create your short ad using a strong hook and a memorable message. From there, take a look at your ad performance to understand user behavior. If you chose a skippable ad, did viewers skip right away, or did they linger for a couple of seconds? Use those insights to adjust your messaging, creativity, and hook for your future video ads.

In-stream video ads are a great way to get in front of a targeted audience and grab their attention. The next time you stop and watch a video ad that pops up before a video, I suggest jotting down what grabbed your attention. Use this as inspiration for your next in-stream ad.

Editor’s note: This post was originally published in July 2020 and has been updated for comprehensiveness.

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