Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

The IAB did some research recently centered around the NewFronts – that place where digital video companies show off upcoming content and features in order to sell ad inventory to advertisers, buyers and agencies. As this is the third year of the NewFronts they also showed some trend data since its inception and basically, TV and digital video ad spends are tied.

Methodology

The IAB conducted an online survey between April 1st and 16th. They got 297 responses of people from "Marketer & Agency contacts from The Advertiser Perceptions Media Decision Maker Database, and third-party databases as needed."Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

Qualification:

  • Involved in Digital Video or TV Advertising Decision-Making
  • $1M+ Total Annual Ad Spend

Directional Data: Some findings in the presentation could reflect data with low bases.

Note: Throughout the survey Original Digital Video Content refers to programming (not advertising) that is professionally produced specifically for digital/online consumption.

So nine out of ten of the respondents are familiar with the NewFronts on some level.

Three Year Spending Trend

Back in 2012 when the NewFronts first started, the majority of agencies and marketers were concerned with television more so than with digital video. But the trend is toward digital video ad spending with a 17% rise in digital video allocation at agencies and 14% with marketers. This year it's a 51/49 split in favor of TV. Extrapolating the growth rate out to 2015 should see digital video pull ahead of its grandsire TV.

Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

It does seem that the trend is slowing though which could result in a straight up 50/50 split next year. Either way, digital video advertising is healthy.

Where are the Ads Going?

The IAB also looked at where that money is going in terms of ad placements and found a very small move away from portals and ad networks (non-video-centric) and into things like social, video sites and directly to publishers. Some of that money also came from the TV digital sites, but just one percent from 2012-13 and no change this year. Marketers are putting more faith into social and portal than agencies, who feel that video ad networks are the place to play.

Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

Continued Growth?

The IAB also wanted to see if this type of growth would continue. Included in the survey was the question, "In the next 12 months, would you expect the amount of [your company’s/your clients’] spend on the following types of advertising to increase, stay the same or decrease?"

The majority said increase, 65% overall including 70% of agencies and 59% of marketers. In fact, just one percent of marketers thought there might be a decrease at all.

TV advertising optimism wasn't so rosy. Less than half believe TV ad spend would grow and just about half believe that it will be the same. That means 15% of marketers and 12% of agencies think that there will be a decrease in the amount of money spent on TV advertising by their clients or company.

Digital Video Ad Spend Creeping Up on TV, Marketing Budgets Shifting

So not only do they believe that digital video spending will likely increase, they seem to believe that the money may come from TV ad budgets. So the next logical question was, from where will that money for increased digital video ad spends come from?

Over two-thirds of respondents (67%) said TV ad spend budgets would likely take the hit for expanded digital video advertising. Nearly half (48%) said overall ad budget expansion, 45% said broadcast TV and 43% said cable TV.

Other sources included interactive TV (27%), non-video digital ads (32%) and non-digital/non-TV ads (33%).

Clearly, this revolution won't be televised…

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About the Author -
Christophor Rick is a freelance writer specializing in technology, new media, video games, IPTV, online video advertising and consumer electronics. His past work has included press releases, copy-writing, travel writing and journalism. He also writes novel-length and short fiction as part of Three-Faced Media . View All Posts By -

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