Online video advertising spend rising across the globe
December 22nd, 2011
Online video advertising spend will see a dramatic rise over the coming year, according to new research.
Digital video ad network Break Media reported that there will be a 32 per cent increase in online video spend, with more money from the traditional TV budgets being injected into the sector.
The media company also reported overall organic advertising budget growth could see a rise of 38 per cent. Display advertising budgets are tipped to see a rise of 45 per cent, according to the firm.
Break Media's vice president of marketing, Andy Tu, told Media Post, “Video advertising spending is growing faster than expected, and this is the first time a significant portion of the increased resources devoted to it are coming from television budgets.”
Recent related research from Forrester Research backed up Break's findings, suggesting an extremely healthy growth for the online video sector for next year. Digital video advertising was tipped to reach £1.2 billion for 2011 and £3.4 billion by 2016.
The dramatic rise in online video spend comes as a result of the rising interest in the medium – according to Break Media, over 90 per cent of all advertisers are planning to utilise video advertising over the coming year. This will take the digital video share of the market up to 41 per cent from the current 20 per cent.
The firm also reported a rise in usage of the cost per view (CPV) formula, as increasing numbers of content providers are starting to offer the pricing method.
According to the research, the CPV formula has grown to have a 40 per cent share of the market. Despite its rising prevalence and popularity, many websites are also offering alternatives to this pricing model, with payment formulas including cost-per-click (CPC) and cost-per-thousand (CPM).
The biggest areas of growth were highlighted by the company's recent annual digital video advertising trends survey, and mobile advertising was found to be a real buzzword.
This was mainly attributed to the increase in mobile devices, which grew two-fold over the last year, with predictions that it will increase by a further 16 per cent in 2012.
The survey also found that the majority of advertisers still prefer the pre-roll online video format, despite the variety now on offer across the online video sector.