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US spending on addressable TV ads doubled in 2015 and is set to double again this year, eMarketer projects in its first estimates of spending on targeted TV ads delivered on a home-by-home basis via cable and satellite.
That rapid growth is from a small base, however. Last year, addressable TV ad spending reached just $400 million in the US, and this year will hit $890 million. Growth will slow in 2017 and 2018, but spending on these targeted TV ads will top $2 billion by the end of eMarketer’s forecast period.
Even then, however, addressable commercials will represent just a tiny share of the TV ad universe—under 3%. This year, just 1.3% of TV ad spending in the US will go toward addressable placements.
In May, Starcom MediaVest Group sized the universe of addressable TV households at 49.8 million for 2016, distributed across several providers, with the largest chunk customers of Comcast.
eMarketer estimates that 100 million US households subscribe to pay TV services this year, so Starcom’s figure would mean just under half of all pay TV households could be reached with addressable TV ads.
In July 2015, 28% of US senior-level agency and marketing professionals surveyed by the Interactive Advertising Bureau (IAB), Samsung and AT&T AdWorks said they were already using addressable TV advertising, and 38% said they planned to take it up in the next 12 months.
In March, Jack Myers estimated that spending on interactive, video-on-demand (VOD) and addressable TV ads—in the aggregate—would reach $700 million this year in the US. The figure is higher than eMarketer’s estimate for addressable TV alone, but includes other advertising options. Jack Myers expects that bundle of advanced TV advertising to see $8.70 billion in US investments in 2020.
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