Online video ad spend is estimated to grow 19% in 2018, following a rise of 20% in 2017. Annually, video ad spend is predicted to grow 17% to 2020 reaching $43 billion. That’s according to new research from Zenith Media which notes that video’s share of online display ads accounted for 27% of display ad expenditure in 2017 and is predicted to account for 30% by 2020.
The increase is largely driven by consumer adoption of online video.
Worldwide consumers are predicted to spend 67 minutes a day viewing online videos in 2018, up from 56 minutes in 2017. By 2020 the average viewing time will rise to 84 minutes per day.
The change in consumption patterns is also having an effect on brands and their campaign plans for both digital and traditional video.
The latest Online Video Forecasts report also highlights that worldwide online video consumption rose 11 minutes a day in 2017 and now accounts for almost all of the growth in Internet use.
China is predicted to lead at 105 minutes a day, followed by Russia (102 minutes) and the UK (101 minutes).
Meanwhile, online video viewing jumped 91% between 2015 and 2017 whilst ad spend grew 52% marking the growth of audiences ahead of demand. This has kept online video advertising costs fairly low, but prices are expected to stabilise by 2019.
Meanwhile, the online video ad market was 10% of the size of the TV ad market in 2015 and has been climbing steadily to 14% in 2017. By 2020, online video ad spend should be 23% of the size of TV ad spend.
“Online video is driving growth in global media consumption, as smartphones with high-speed data connections make high-quality video available to people on the move, and smart TV sets give viewers unparalleled choice in the living room,” said Jonathan Barnard, Zenith’s Head of Forecasting and Director of Global Intelligence. “The rapid rise in video viewing makes online video the world fastest-growing advertising format, creating new strategic and creative opportunities. Brands that do not currently have a strategy for online video need to think about getting one.”
Overall, online and TV advertising have been used largely together by many brands to drive cross-device campaign reach. Outstream advertising, i.e. standalone video ads within text or images or social feeds, are becoming more common and have now overtaken instream ads in the UK accounting for 56% of video ad spend 2017.