New Report Says Online Ads Have The Momentum

There for a moment I was fearful the giant march to online video was slowing to a disorganized shuffle. But a new report from MoffettNathanson carries new assurance that advertisers are indeed moving off TV and on to digital.

This, certainly, is not everybody’s opinion, but in a new report from Michael Nathanson, he underlines the importance of a stat about the second quarter, when it was deduced 98% of the growth in total ad spending came from online.

Those are always tricky statistics—when a newbie goes from 0 to 60, that speed is spectacular, but not so much when compared to the vehicle that was already traveling at 65.

It’s undeniable that the trend of things indicates the big momentum is with online. There were a lot of What Does This Mean? Stories after it was determined that in 2013, for the first time ever, there was more online advertising sold, in all forms, than TV spots.  In that tabulation, online advertising made up 19% of the total $42 billion.

In this report, Nathanson notes that in  Q2, network advertising caved 4.7%, and cable, while up 3.6%, was undistinguished, except for some of the World Cup games on ESPN that fell in Q2.  (The final contests showed up in Q3).

It’s hard to share all of the enthusiasm in this report. While it’s pretty clear audiences are increasingly finding online video and that mobile is a great device for online content makers and advertisers, it’s also true that at least half of the conversation about online advertising is about how many people avoid watching it and how many low operations place unviewable ads and don’t get called on it because they’re so hard to detect. That's hardly a welcome mat.

And let’s also mention, Netflix is doing a lot of the heavy lifting for online video, and there aren’t any commercials there.

This report has sour outlooks for TV, though. Nathanson says there will be a “continued shift” to online video, and says that in 2015, when nothing is happening—no elections, no Olympics—total TV ad sales will fall 0.3%, but broadcast network sales will see a shocking 5% decline.

Presumably, things will improve for TV in 2016, when billions (and billions) of dollars will go into elections. The conventional wisdom is that broadcast TV will get most of that, and online video the least.

That may be true, too, but it’s an increasingly negative political atmosphere, and a population that is also increasingly finding online sources. It seems partisan Websites, one way or the other, could be great conduits for political advertising, and native advertising could be powerful too.

Most of all, the fact that political advertising is so thoroughly noxious, and overwhelming, should make it a banner year for Netflix.  It could be the great escape.  

pj@mediapost.com         

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1 comment about "New Report Says Online Ads Have The Momentum".
  1. Jim Rice from Piiku , September 3, 2014 at 1:38 p.m.
    More writing on the wall for traditional linear TV advertising. Without seeing the MoffettNathanson report, I can't say for sure, but it appears that one of the most significant positive attributes of online video advertising is not mentioned. What appears to be missing is the positive impact that engagement advertising will have on brand ROI as this shift occurs. With much higher CPMs, no waste, validated views, and the like, engagement advertising provides real opportunities to advertisers as this shift occurs.