Video is the fastest growing form of digital advertising, forecasted to represent 80-90% of global consumer Internet traffic by 2018*. Leading social networks are now competing with premium publishers and consumer generated video sites, such as Google’s YouTube and Vimeo to be the leading source of video consumption on the web.
Here are some of the key trends in video advertising:
- Video ad views exploded in 2013, topping over 35 billion views in December, averaging over 100% year-over-year monthly growth during the year.
- Online video ads are significantly more expensive than other formats, but prices are steadily declining as more publishers rush into video, and placements open up.
- Video ads have an average click-through rate (CTR) of 1.84%, the highest click-through rate of all digital ad formats.
- Viewability, the question of whether video ads are actually seen by multitasking online viewers, has emerged as an issue, but we believe that overall demand for online video is too high for viewability to put too much of a crimp in the video ad market.
- Streaming devices and connected TV accounted for just 2% of online video ad views in the fourth quarter of 2013, but companies like BrightLine are experimenting with formats to grow this new niche market.
- The growth of mobile and digital video advertising has been paralleled by fundamental changes in the online advertising industry — programmatic advertising, which we covered in a recent report, has begun to reshape the entire digital ad market, including video.
- Newly launched video ad platforms have been among the companies to adopt programmatic tools, including real-time bidding, ad exchanges, and advanced analytics.
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