As users become savvier and less responsive to traditional banner ads, publishers struggle to maintain revenue.
In response, the advertising industry is constantly evolving as both advertisers and publishers look for new ways to improve ROI and diversify revenue.
One option that has been gaining traction recently is interstitial ads, which have very high viewability and click-through rates (CTRs). However, these ads are intrusive and hamper UX, giving them a mixed reputation among publishers.
In this article, I will give you an overview of interstitial ads and discuss a new study that shows how you can implement them while still maintaining user experience.
What Are Interstitial Ads?
Interstitial ads are full-screen advertisements that pop up between the user's current page and the page they intend to navigate to.
These ads are hard to overlook and require users to take action in order to proceed to their intended destination. This feature makes them an excellent tool to grab users' attention and encourage them to engage with the ad.
As user engagement increases, advertisers are willing to pay higher CPMs (cost-per-mille, or, cost per one thousand impressions), resulting in higher RPMs for publishers.
Advantages
For advertisers, engagement is the name of the game. The goal of digital advertisers is to have users see, click, and eventually purchase their product or service.
Due to the incredibly high viewability of interstitial ads, more users click on them, which is why advertisers are willing to pay so much.
For publishers, it is a simple matter of supply and demand. There is a large demand among advertisers for interstitial ads, but not a large supply because publishers need to limit them (more on this below).
Given this situation, publishers can charge advertisers very high CPMs for interstitial ads.
Disadvantages
Given their high eCPM (effective cost per mille, or, how much the publisher receives per one thousand impressions), one may wonder why not all publishers use interstitial ads.
The main drawback of interstitial ads is their effect on user experience (UX). The intrusive nature of the ads hampers UX, which can result in lower traffic.
In addition, if implemented incorrectly, interstitial ads can lead to slower loading times and penalties for misuse. That is why publishers must implement frequency capping to ensure that the ads don’t appear too often.
New Study Shows How to Boost Revenue and Maintain UX
It’s pretty evident to everyone in the industry that interstitial ads yield more revenue for publishers than traditional banner ads. However, a recent study by the ad monetization company Adnimation quantified just how effective the ads are.
According to the study, the average eCPM of interstitial ads was more than 4,000% higher than regular banner ads. This means that if your average eCPM for banner ads is $1, the eCPM of your interstitial ads would be $41.
The study analyzed data from 50 random publishers, with half based in the United States and half based in Europe, for a duration of 3 months. According to the study, the effectiveness of interstitial ads was nearly identical for US and European traffic.
A key takeaway from the study is that the high eCPMs of these ads can enable publishers to decrease the number of regular banner ads and improve UX, while still generating more revenue.
In other words, due to the fact that eCPMs for interstitial ads are so high, publishers can now afford to improve the overall UX of their site by reducing the number of regular banner ads. This is great news for publishers who are on the fence about implementing this strategy due to UX concerns.
That is not to say that interstitial ads don’t affect UX. They still do. However, their high value can allow you to offset the costs of showing fewer overall banner ads on your site.
There’s a Catch
Of course, there’s a catch, there always is.
But in this case, the catch is simple: do it right!
As noted above, incorrect implementation can lead to penalization. In fact, Google has strict guidelines for interstitial ads, and the last thing you want is to be penalized by Google.
Given this, you need to ensure that interstitial ads are placed correctly, have a frequency cap, and feature a clear 'X' or close button.
In addition, you need advanced ad-serving technology and ongoing management to maximize the prices. Don't just implement the ads and hope for the best. Yes, your revenue will improve, but you won’t get the most you can from the ads.
For the best results, make sure to actively monitor the ads and make real-time decisions on when and to whom to show the ads based on the relevant data.
Lead Image: Myriam Jessier
Also published here.