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Continued Growth Expected for Video Ads
by Jack Loechner, Wednesday, May 20, 2009 12 AM
According to BrightRoll's Q1 2009 Video Advertising Report, polling nearly 150 US advertising agencies with a special focus on video advertising, 87% of agency executives plan to spend
more of their online advertising budgets on video in 2009, EMarketer predicts Online video advertising to grow 45% in 2009, reaching $850 milion, and 71% of survey respondents view online video
advertising as a complementary medium to television. Respondent View of Online
Advertising In Conjunction With TV Advertising View% of
Respondents Complementary 71% Not
relevant comparison 13 Competitive 12
Other 4 Source: BrightRoll Video Ad
Report Q1 2009, May 2009 53% of respondents expect instream CPM prices to be marginally lower one year from now, and 20% think the price of pre-roll will
drop to half of what it is today. The most important factors in CPM pricing, as seen by the respondents, are:
- 45% say surrounding content
- 27% say click through
rate
- 25% say site placement
- 3% say length of at
BrightRoll's average CPM (cost-per-thousand impressions) numbers from the industry at large confirm
the trend:
- Average pre-roll CPM: Q408 vs. Q308: down 12.5%
- Average pre-roll CPM: Q408 vs. Q407: down 25.0%
- Percentage of campaign revenue from rre-roll:
Q109 (80.6%), Q108 (63.1%)
The drop in CPM pricing "could be a good thing," because cost may have been limiting growth, TechCrunch observed, saying if prices come down
further to $7-9 instead of $20, they'll be more comparable with TV commercials, which range between $15 (primetime) to $50 (niche, targeted cable channels). The survey found that reach and
targeting capabilities are the aspects of online video advertising that respondents say their clients are most concerned about:
Online Video ConcernsConcern% of Respondents Targeting capabilities 28% Reach 24 Price
relative to TV 17 Ability to reuse creative
9 Ad unit format 7
Other 15
Source: Source: BrightRoll Video Ad Report Q1
2009, May 2009 Survey respondents would like to see more behavioral and contextual advertising in 2009, so that search and display marketers can easily
tailor ads. The report opines that agencies must alter practices to get the most out of targeting, instead of using repurposed TV-specific spots for the Web.
Type of Targeting Respondents PreferTargeting% of Respondents Behaviorial
38% Contextual 27
Demographic 17 Deep-geographical 12 Content 6
Source: Source: BrightRoll Video Ad Report Q1 2009, May 2009 Both pre-roll and in-banner ads were
regarded as preferable units, with one out of two respondents saying their use of one or the other depended on the situation and advertiser goals. Reasons for their preference, according to the
survey, are guaranteed impressions, overall engagement, and noticeability. The study finds that 41% of the respondents are more likely to buy inventory from an ad network, or 51% from a portal
because of the key differences between display and video advertising:
- Portals don't offer "nearly" the reach in video as in display
- Portals are priced at
high end of market, whereas in display they dominate both highly priced direct buys and remnant inventory
- Portals don't sell significant volume of video inventory from their
owned and operated properties
Primary Perceived Benefit Buying From Video
Advertising NetworkBenefit% of Responses
Lower price 46% Campaign execution efficiencies
28 Higher quality content 12
Video inventory without display or sponsorship bundling 11 Delivery speed
and/or budget fill 3
Source: Source: BrightRoll Video Ad Report Q1 2009, May
2009 Pricing for video ads also varied depending on where they were located on-screen, says eMarketer, in a recent release. Online video consultancy
LiveRail estimated that overlay ads ran CPMs of $7.40 and in-stream ads were priced at $16.40 in Q4 2008. AccuStream iMedia Research put the average 2008 figure as high as $35 for premium preroll
online video ads.
Average US Online Video Advertising CPM, 2008TypeCPM ($) Premium
preroll $35 Preroll 25
Ad network inventory 13 In-banner video impressions 11
Source: AccuStream iMedia Research, Jan 2009, from eMarketer, May 2009
The most surprising finding of the survey, Marketing VOX said, was the lack of data and effort around video advertising efficacy, noting that 87% have not performed any in-house
research around their online video campaign efficacy. A recent Forrester report concluded that interactive advertising is heading for growth over the next seven years, and Nielsen Online
presents most recent data on video usage on line. Overall online video usage and top online brands ranked by video streams for April 2009. Year-over-year, total streams, streams per viewer and
time per viewer were up, led by a 58% growth in time per viewer.
Overall Online Video
Usage(U.S.) Apr-08Apr-09 Percent Change Unique Viewers (000)
119,626 116,691 2.5% Total Streams (000)
7,613,847 9,452,996 24.2% Streams per Viewer
63.6 81.0 27.4% Time per Viewer
(min) 130.1 205.7 58.1%
Source: Nielsen Online, May 2009 VideoCensus (Includes progressive downloads and excludes video advertising) To
download the BrightRoll PDF report, please visit here.