Online Video Taking a Bigger Chunk of the Ad Budget

For the past few years, publishers and marketers have been preparing for the arrival of the online video ad sector in a big way. In 2013, marketers and agencies are shifting more money into the format, for desktop and mobile. Adap.tv's latest webinarsurvey predicts big growth next year, too, as media buyers cannibalize funds from other formats to pay for online video, but the ongoing problem of audience measurement poses challenges.

In 2014, 86% of brands will spend more on online video as will 91% of agencies. This year, 33% of marketers are increasing ad spending overall in order to get their video ads on front of online consumers. However, some brands are shifting funds from the following media formats to pay for their new strategy:

  • Broadcast TV 31%
  • Display 30%
  • Print 19%
  • Cable TV 10%
  • Direct response 6%
  • Search 5%
  • Out-​of-​home 3%

Agencies are looking for ways to pay for online video, too. 42% are tapping out-​of-​home advertising and 26% are cutting search budgets in order to fund online video. Agencies also noted that when they cut the broadcast TV budget for online video, 45% made a reduction of between 1% and 10%.

Part of the online video spending will go to mobile. About 70% of agencies who buy online video allocate some money to the mobile format. For brands, that number is 43%.

At this point, the only factor holding back online video growth appears to be measurement standards. At least 70% of agencies and 65% of brands say existing standards don’t satisfy their need for audience guarantees.  Brands also want to know who’s seeing their videos and they want more detail, information beyond age and gender. Finally, both agencies and brands would like to have an accurate cross-​screen measurement of audiences.

It will be fascinating to see how quickly online video grows in light of the frustrations about audience measurement. What's your prediction?

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.