What’s Ahead for Video Advertising?
By Patrick Hanavan |
Media intelligence firm Zenith recently released its “Online Video Forecasts 2017” report, highlighting consumer and advertiser trends related to the format in the year to come. Not surprisingly, the report paints a rosy picture for the future of video consumption and ad spending, particularly when it comes to mobile devices. What are the main takeaways from Zenith’s report, and what can advertisers learn from them? Here are three key themes:
Consumer consumption of video continues to grow
Video is already popular with consumers. But Zenith predicts a significant surge in video viewing will continue to push consumption even higher, with estimates that consumers will spend more than 47 minutes per day watching online video in 2017. This in comparison to just over 39 minutes in 2016. Need proof that consumers are hungry for more streaming video? Just look at Netflix, which blew past its quarterly subscriber goal for Q2 2017, adding more than 5 million subscribers instead of the predicted 3 million. This is in addition to the continued push by digital platforms like YouTube, Facebook, Instagram, Twitter, and Snapchat into the video content and advertising sectors.
Video consumption is shifting to mobile devices
Consumption isn’t just increasing because there is more video to watch. Zenith notes that another key factor in the skyrocketing demand for video content is the shift in viewing time toward mobile devices. In the company’s 2017 forecast, time spent viewing video on smartphones and tablets will increase 35% over the year prior to reach an average of 28 minutes per day. This is in contrast to time spent viewing video on “fixed” devices like PCs, laptops and smart TVs, which Zenith predicts will “peak” in 2017 as it grows by just 2%, accounting for 18 minutes of consumption for per day.
More video content everywhere means more opportunities for advertisers
The good news for advertisers is that as overall consumption and mobile consumption of video continue to grow, there will be more opportunities to allocate media dollars to the format. Zenith expects online video spending worldwide will grow by 23% in 2017, reaching more than $27 billion. Furthermore, Zenith expects online video will account for nearly one-third (31%) of all digital display ad spending. The rapid shift toward mobile consumption also means that advertisers should be conscious of how they’re allocating budgets toward mobile video versus overall video spending. Zenith estimates that spending on video ads targeting “fixed” devices will be $15.2 billion in 2017, while mobile video will reach $12 billion.
The video advertising sector continues to evolve, thanks to rapidly changing consumption habits and significant shifts in advertising spending. With so many changes happening so quickly, including the move to mobile video and new video ad formats, it can be hard for agencies and advertisers to stay on top of it all. But as Zenith’s forecast indicates, this fast-moving sector looks likely to continue its rapid pace of progress and innovation.