Video is quickly becoming the dominant medium of the smartphone era.
YouTube, Facebook, Instagram, Twitch, BuzzFeed, and Snapchat videos are increasingly keeping audiences glued to their small screens, opening up new greenfield opportunities in advertising.
In this all-new in-depth research from BI Intelligence, we find that US digital-video advertising revenue from PC- and mobile-based video ads will top nearly $US5 billion this year, and grow at a five-year compound annual growth rate (CAGR) of 21.9%. Total revenue will reach $US13.3 billion by year-end 2020, according to BI Intelligence estimates based on historical data from the Interactive Advertising Bureau (IAB).
Here are some of the key takeaways:
- Video is quickly replacing static display advertising on desktop. Video will account for 41% of total desktop display-related spending in 2020, up from a 26% share this year.
- Video ads perform better than standard display ad units. In-stream video ads, including ads that play at the start, during, and after video content, yielded click-through rates (CTRs) that were 18x higher than HTML5 banner ad units in February 2015, according to Google’s Rich Media Gallery.
- Video’s premium status within digital is reflected in the format’s high prices.Video ads tend to cost significantly more (e.g., 2x or 3x) than non-video ad units on premium publishers like Vice and Instagram.
- Facebook, Instagram, and Twitter have all introduced new digital-video ad products. Social video offers several major advantages from an advertiser perspective, including huge built-in mobile audiences, advanced targeting, and native-style ad units.
- But despite their high prices and strong results, video ads create a special set of challenges around viewability.
In full, the report:
- Forecasts programmatic and digital video spending on desktop and mobile through 2020.
- Analyses recent video-ad price and performance trends.
- Outlines new video-ad products from social networks like Facebook, Twitter, and Instagram.
- Explores the unique hurdles that video-ads face for viewability.
To access the full report from BI Intelligence, sign up for a 14-day trial here. Members also gain access to new in-depth reports, hundreds of charts and datasets, as well as daily newsletters on the digital industry.
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