Basically, there are two types of ads on the youtubes. One type is the actual ads that are sometimes unskippable and are marked by the yellow progress bar. Then there are sponsored ads which come in the middle of the video (for example: this video was sponsored by NordVPN) and are put in the actual video. Usually these are very short and only like 2-5 seconds long.

I don't really get the point of sponsorblock either since I can just skip them by pressing the arrow key)