Home Ad Exchange News Online Video Surges, As Advertiser Budgets Cut Into TV

Online Video Surges, As Advertiser Budgets Cut Into TV

SHARE:

AdexpendVideo ad spend will continue to explode, increasing 29% per year and reaching $23.3 billion by 2017, according to the latest update to ZenithOptimedia’s global ad expenditure forecast.

While 29% is a decline from the 34% growth rate Zenith recorded for online video in 2014, the format is the fastest-growing digital ad category, partially due to mobile.

Zenith predicts mobile ad revenue will grow 39.8% through 2017, while desktop display will grow 4.6%.

Other factors driving online video growth include measurement firms Nielsen and comScore’s investment in cross-platform video metrics, companies like YouTube, Facebook and Twitter investing in video ad products and the fact that programmatic video buying gives “advertisers with more control and better value,” according to Zenith’s report.

Zenith’s numbers illustrate the shift from traditional TV buying to “total video.” While television accounted for 39% of ad spend in 2014, it’s expected to grow at a much softer rate (3%) than other formats through 2017, particularly as more marketers move budgets from television to online video. 

IPG Mediabrands’ media investment division MAGNA Global similarly saw softening in TV ad spend. An update to MAGNA’s forecast in February estimated that TV ad revenues grew only 3% in 2014.

Advertisers, agencies and even media companies are beginning to complement and package television buys with online video and mobile, said Jonathan Barnard, head of forecasting for ZenithOptimedia.

“It’s obviously something broadcasters are looking at now, too, because they’re facing a lot of competition from upstarts and online services,” he said. “The broadcasters have a long-entrenched advantage in producing content, and so new ways to distribute and monetize existing content is something that would be very valuable to them.”

Zenith’s projections did not specifically reference investments in programmatic TV. While programmatic’s efficiencies has made it attractive for online display buying, it hasn’t arrived in TV – at least not yet.

“Certainly we see opportunity for programmatic to grow in offline, as well, with TV, and things like digital out-of-home,” said Barnard.

Total global ad expenditures will increase 4.4% in 2015 to reach $544 billion, a slightly downward revision by Zenith (0.5 decrease in percentage points) due to economic strain in Russia, the Ukraine and China. This figure was generally in line with MAGNA’s total global ad expenditure forecast for 2015, which was $536 billion.

Must Read

Comic: Ad-ception

The New York Times And Instacart Integrate For Shoppable Recipes

The New York Times and Instacart are partnering for shoppable recipe videos.

Experian Enters The Third-Party Data Onboarding Business

Experian entered the third-party data onboarder market on Tuesday with a new product based on its Tapad acquisition.

Albertsons Takes Its First Steps Into Non-Endemic Advertising, Retail Media’s Next Frontier

Albertsons is taking that first step into non-endemic advertising next week via a partnership with Rokt to serve ads to people who have already purchased groceries.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters

Marketecture Buys AdTechGod (No, Really)

Marketecture has acquired AdTechGod – an anonymous ad tech Twitter poster turned one-man content studio – and the AdTech Forum, an information resource hosted by AdTechGod and Jeremy Bloom.

Why The False Advertising Lawsuit Against Poppi Is Bad News For RMNs

This week’s dispatch explores the new trend of false advertising class-action suits in the food and CPG industry and how the evolution of online, data-driven retail media could exacerbate the problem.

Seedtag Acquires Beachfront For Deeper Roots In TV And Streaming

Contextual ad platform Seedtag acquires Beachfront, a supply-side platform that specializes in TV and video.