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A new report has found that digital video is continuing its rise among advertisers as an important way to engage with consumers across desktop, mobile and non-linear TV.

The IAB Video Advertising Spend Report conducted interviews with 350 marketers and agency decision-makers across a range of sectors. Its findings paint a picture of enthusiasm for video ads – particularly among those buyers who are keen to explore emerging formats and channels outside dominant social media platforms.

Impressive growth driven by Original Digital Video and ATV

The top-level trend is that spend on video advertising by businesses and agencies is continuing to grow, hitting $17.8m in 2019. This is an increase of 25% on 2018.

graph showing average dollar amount spent on digital video advertising

The report finds that growth is significant across all verticals. Leading sectors such as Media & Entertainment and Fashion/Apparel have seen massive jumps of +75% and +45% respectively over the past year.

Original digital video (ODV) is really driving this boost in spend – increasing +31% between 2018 and 2019. Now, just over half (52%) of all digital video budget goes on ODV.

On top of this, advanced TV (or ATV – video that is delivered outside of traditional linear television such as Addressable Linear TV, Connected TV and Over-the-Top TV) is also seeing growth in investment among advertisers. 59% of ad buyers say they are looking to increase their ATV spend over the next 12 months.

Where is video content being delivered?

A big milestone for video this year sees mobile reach parity with desktop for spend share.

In 2019, mobile video and desktop video each account for 31% of all digital video spend as advertisers continue to shift portions of their budgets to handheld screens.

graph showing digital spend allocation of video vs non-video

As for channels, the IAB data sees a fairly disparate spread of the types of websites and publishers where digital video is being presented.

graph showing average percent digital video budget allocations to each channel

Social media sites do have a slight edge, receiving 22% of video budget allocations. This is closely followed by TV shows online (18%) and news sites (14%).

A closer look at video ad formats

The report finds that digital video budgets are quite evenly distributed across in-app, out-stream and in-stream formats.

graph showing average percent allocation to each digital video allocations to video ad format

The data also highlights the growing popularity of emerging ad formats – with 6 second ads, vertical ads and stories all being purchased by more than half of respondents. Marketers are increasingly using formats that invite a certain degree of interactivity from users, such as shoppable ads or fully interactive ones.

types of video ad formats purchased in 2018 and 2019

Native ads are also prevalent. 52% of advertisers say they have increased their spend on native ads in the past year. Additionally, the report has found that the way advertisers are buying their video ads is becoming increasingly automated. It predicts that more than half of video ads will be bought programmatically in 2019.

Other findings

The comprehensive report also highlighted some other notable trends:

  • Direct to consumer (DTC) brands are planning to spend more on digital video – allocating as much to publisher sites (such as CNS, Conde etc.) as they are to big name social media sites like Facebook.
  • Use of influencers is popular among ad-buyers, with 70% using them and a further 9% planning to in the next 12 months.
  • Multi-platform buying solutions are favored among marketers. More than 8 in 10 advertisers agree a unified digital + TV buying solution is important.

Takeaways

The IAB Video Advertising Spend Report highlights the value and opportunity in video advertising, and the subsequent enthusiasm in the channel among a broad range of advertisers.

The ever-growing range of native and interactive formats is giving marketers even more options to engage with consumers across a range of devices, as well as in-app and on a variety of different publisher sites online.

The popularity of ATV and lean towards multi-platform buying solutions is notable too. Consumers expect consistency of messaging across channels, but all digital contexts – from smart TVs to in-app video – require their own consideration to ensure video content is being delivered correctly.

Advertisers need to be joined-up in their approach. Especially, as channels, contexts and formats continue to diversify.

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