World’s Biggest Online Video Ad Network Moves to Cost-Per-Engagement Pricing Model

By on 08/08/2011 6:57 AM @daisywhitney

Ad networks like Tremor Video aren’t aiming to compete with the premium publishers, said Jason Krebs, SVP and Chief Media Officer for Tremor, who was a panelist in the Beet.TV Leadership Webcast which originated in the AOL Studios in New York last month.

Instead, Tremor focuses on selling reach, frequency and engagement, while premium sites sell brand adjacency, custom ideas and a permanent position to advertisers, Krebs said during a discussion on whether ad networks and exchanges potentially commoditize video ad pricing.

Tremor is one of the first video ad networks to sell pre-rolls on a cost-per-engagement basis. That’s an important metric because engagement is a sought-after measurement by advertisers and it’s one that’s been hard to come by so far on the Web. With cost-per-engagement units, advertisers only pay when viewers engage with the ad.

“The cost is relative to the value of what you are providing to the consumers,” Krebs said. “If you have a good message to tell, we will make sure it finds its home with the right audience.”

According to comScore, Tremo Video is the largest online video network.

Also in this segment, Molly Sugarman of Horizon Media, the biggest independent media buying shop, speaks about the value of engagement around video.

Update 8/8: In an email to Beet.TV, Krebs tells us that from the second to the third quarter, Tremor expects to see a 140% increase in pre-roll cost-per-engagement revenue. "We are seeing very strong correlation to engagement and brand lift, which is obviously highly attractive to big brand advertisers," he says.

Daisy Whitney

 

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