Digitizing for dollars.
Online video advertising accounts for a relatively small share of overall Internet ad spending, and it is dwarfed by television advertising budgets.
eMarketer projects that US online video spending will account for only 4.3% of total online ad spending, and a mere 1.6% of television ad spending.
But online video advertising is growing.
By 2013, eMarketer estimates online video spending will account for 11% of online ad spending and 5.5% of the TV ad spend.
Although at first glance the figures may not look like much, to achieve them online video advertising must grow steadily and spectacularly.
After a big burst last year—over 125% growth—eMarketer expects to see growth over 40% for four years, “falling” to slightly over 30% in 2013.
“As the main vehicle for brand marketer ad spending, TV is not losing its place to online video advertising anytime soon,” says David Hallerman, eMarketer senior analyst and author of the new report, Digital Video Advertising: Where’s the Money?. “In 2009, for example, for every $100 advertisers spend on television, they will spend only $1.60 for video ads. Even by 2013, that number will only reach $5.50.”
However, even at this early stage, online video advertising does lead television advertising in one important metric: ad spending per hour viewed.
eMarketer projects that TV advertisers in the US will spend only $0.13 per hour of viewing, while their online video counterparts will spend 38% more, at $0.17 per hour.
“Since the time people spend watching video or TV content produces potential engagement points—moments to reach them with the marketer’s message—this is a suitable method for gauging the strength of these two parallel ad spending formats,” says Mr. Hallerman.
Digital Video Advertising: Where’s the Money? is a special, enhanced report, and available only to Total Access subscribers. For information about subscribing, click here.