Online video adspend to rise a whopping 27.5% this year

Advertiser expenditure on online video continues to grow rapidly thanks to a boom in mobile consumption and most of that spending is going on social platforms – despite concerns over brand safety and ad fraud – according to a WARC report.

The latest monthly Global Ad Trends report focuses on online video and says that expenditure on the medium – inclusive of pre/mid/post roll, social and broadcaster VoD – is expected to rise 27.5 per cent to reach $29.8 billion this year.

And with linear TV advertising increasing at just 1.1 per cent this year, online video is taking an ever greater share of the total video advertising market – 17.5 per cent in 2018.

The shares vary widely between markets, however. In the UK, online video is expected to account for 38.2 per cent of all video adspend this year; in China the figure is 24.7 per cent while in the US, the largest video market by far, the figure is 19.3 per cent.

With over 60 per cent of daily online video viewing now on mobile devices, most of this money is going to mobile-optimised social platforms such as YouTube and Facebook, the report says.

UK data from the AA/WARC Expenditure Report, for example, shows that of the £1.6 billion spent on online video advertising last year, 81.2 per cent (£1.3 billion) was paid to social platforms (up from a share of 55.4 per cent in 2014).

“The vast and continuing increase in video consumption via mobile devices has directed ad dollars to social platforms, despite the well-documented and persistent risks around negative adjacency and ad fraud,” said James McDonald, Data Editor, WARC.

Data for the second half of 2017 shows that at least one in ten online video ads pose a risk of negative adjacency to brands. And a recent study by Guardian US and Google found that as much as 78 per cent of video spend is susceptible to fraud if the publisher does not employ the ads.txt script within their website.

“Facebook hopes to regain the initiative with its Watch platform, which is being positioned as a safe brand environment offering advanced audience segmentation”, McDonald noted.

As influencers account for more than half of video views on Facebook, advertisers are increasingly turning to them to build brand equity and deliver their messaging aside approved content.

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