Video seems unstoppable these days. Digital video and TV ad spending exceeded eMarketer’s forecasts in both categories. It reached a milestone in 2018, when it accounted for 25% of all US digital advertising. Streaming services, such as Hulu and Sling TV, also posted significant gains in their ad businesses in 2018. Video ad spending continues to grow at a double-digit pace, with total spending estimated to be over $36 billion in 2019.
The video ecosystem is actively changing, too, sometimes in opposite directions. Amazon launched Freedive, an ad-supported video-on-demand (AVOD) service through its IMDb unit in January. This strategy is consistent with Amazon’s decision to keep ads “always on” in its gaming and video platform Twitch. On the social side, TikTok, the Vine-like mobile app where (mostly) young users can watch and create short videos, is rumored to be testing four types of video ads for the US market, including native video ads. Meanwhile, Apple and Disney’s newly introduced streaming TV services will be ad-free.
An estimated 82.8% of all internet users in the US or 235.1 million people watch video in its various forms. Just over half of them watch live streaming video on platforms including linear OTT services, sports, live events, social media and news publisher streams. The number of live video viewers is growing at a faster rate than video viewers overall. These audience trends show how the lines between video categories are becoming increasingly blurry. Is TV becoming more like digital video or is digital video the new TV? And what does it all mean to marketers?
Most players are betting on the convergence of the advertising market for video and TV. Comcast is beginning to integrate its digital video and traditional TV ad delivery through its FreeWheel and NBCUniversal businesses. Nielsen’s Total Ad Ratings measurement system now includes YouTube mobile ad inventory. US connected TV ad impressions served by Extreme Reach almost tripled in a year, growing from 15% to 44% of the total in Q4 2018.
With all the success and popularity come some challenges. Marketers are increasingly concerned about video fraud on the ad delivery networks, according to one study from last year. And, the question of how best measure video ads’ impact remains partially answered, at best.
Net Conversion’s own quest for an accurate metric for video advertising led us to the creation of our View-Influenced-Visit (ViV) awareness metric. This custom metric allows us to fine-tune digital video to reach the audiences with the lowest Cost per ViV, thus ensuring optimal performance. By using ViV measurements over several years, we developed a methodology that now allows us to directly forecast and influence results generated by our digital video efforts. By thinking past the basic metrics related to video, we were able to build a sustainable innovative technology that can respond to the fast-changing video environment and our clients’ custom needs and goals. If you want to learn more about ViVs, let us know!
