Digital Content NewFronts Predicted to Capture 40% of ODV Spending

The IAB has done a new study just in time for the Digital Content New Fronts. Like most IAB studies, this one is positive for the industry.

The key highlights are a prediction of ongoing strong growth for digital video, with the average advertiser spending more than $9 million annually for its grand’s digital video advertising. This represents a 67% increase from two years ago, and at present, video represents more than 50% of a brands digital/mobile ad spending. Most advertisers are optimistic about how their advertising is contributing to the brand’s success, and plan to invest more in the next 12 months in mobile and video and maintain current TV spend levels. For the first time this year, digital spending outpaced TV spend.

Agencies really like cross-platform campaigns that include both TV and online video, and those campaigns are driven the agencies, 67% of whom plan to increase cross-platform spending.

How brands and agencies spend: 

Direct and indirect buying of Digital Video are both robust: Programmatic Video buying seeing broad adoption and steady growth – accounting for 45% of all Digital Video dollars spent. Yet still more than half spend directly with premium video sites. Advertisers currently allocate digital video budgets fairly evenly across multiple channels (TV shows online, news sites, etc.) Suggesting advertisers are still in a test and learn phase and presenting an opportunity for channels to prove their effectiveness for a greater slice of the pie.

The good news is that every market sector increased its mobile/digital video spend over the past three years, although telecommunications is the biggest ad spender.

Ad spending on original digital programming has nearly doubled since 2015. In 2016, 42% of original digital video dollars went to native advertising opportunities. The perception on the part of video advertisers is that digital video reaches an audience that can’t be reached on TV, and will become as important as original TV programming within the next 3 years.

As a result of rapid changes and growth in the industry, 67% of video advertisers plan to attend the 2017 NewFronts, and those who believe in video agree that attending last year’s NewFronts encouraged them to plan ways to incorporate VR and 360 video ads into their lineups. Although VR hasn’t taken off on a mass scale just yet, 360 video and VR are already supported by Facebook and Google, which makes investment in those formats unavoidable for advertisers.  This year’s NewFronts is predicted to capture 40% of advertisers’ original digital video budgets.

Once again the winds of change are sweeping across the media landscape.



Digital Video Ad Spend Grows

Digital Video Ad Spend Growing Sharply