65% of Digital Media to be Traded Programmatically Next Year

Programmatic ad spend will have grown by 24 percent over the course of this year, and will grow a further 19 percent next year, according to Zenith’s Programmatic Marketing Forecasts published today. This will mean that in 2019, 65 percent of all digital media will be traded programmatically. But while the growth of programmatic trading continues to be strong, Zenith says it’s slightly slower than expected, due to a mixture of new data laws and investment patterns within the industry.

Zenith says growth is being driven by the fact that the breadth of formats which can be traded programmatically is improving all the time, specifically with mobile video and audio formats increasingly available programmatically.

The company believes that very soon there will be very little which cannot be traded programmatically, and from there is it simply a question of how quickly each country embraces total automation. Zenith predicts that by 2020, 99 percent of digital media will be traded programmatically in Canada.

“We expect all markets to follow Canada and use programmatic trading for all digital media transactions eventually,” said Zenith’s report. “Indeed, it’s only a matter of time before programmatic trading becomes the default method of trading for all media.”

For the moment, adoption of programmatic trading is highest in the US, where Zenith says 83 percent of all digital media will have been traded programmatically this year. Given the scale of the US’s total digital ad spend, this means nearly half of all programmatically traded ad dollars will have been spent in the US ($40.6 billion out of a global total of $84 billion).

Canada comes in second, with 82 percent of digital media traded programmatically. In Europe, the UK and Denmark lead the way, with 78 percent and 75 percent of digital dollars spend programmatically in each country respectively.

Progress towards total adoption has been slightly slower this year than expected, which Zenith attributed to a couple of factors. One was the introduction of the EU’s general data protection regulation (GDPR) which restricted the data available for programmatic transactions, making it simultaneously more expensive and less attractive.

But Zenith thinks the primary cause was that advertisers have been investing heavily in making programmatic trading more effective, at the expense of ramping up the scale of programmatic buying as quickly as they might otherwise have done.

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Viewers Will Stream 47 Minutes of Video Per Day in 2017

Global viewers will average 47.4 minutes of online video viewing in 2017, forecasts media buying agency Zenith. That’s up from 39.6 minutes the previous year. Nearly all of that increase will come from mobile devices, where online video viewing will grow 35 percent to 28.8 minutes per day. Looking ahead, it should grow another 25 percent in 2018 and 29 percent in 2019 thanks to an increased use of mobiles, better screens, and faster mobile connectivity.

Viewing time on non-mobile devices (including connected TVs, desktop computers, and laptops) will grow only 2 percent in 2017 to 18.6 minutes per day. Within that area, Zenith sees connected TV streaming time rising, while desktop and laptop viewing times are decreasing. Viewing times on non-mobile devices will actually shrink by 1 percent in 2018 and 2 percent in 2019.

This data comes from Zenith’s Online Video Forecast 2017, and includes all online video sources such as video sharing sites and subscription services. In 2019, mobile devices will make up 72 percent of all online video viewing, Zenith says, up from 61 percent in 2017.

All this video viewing will lead to an increase in advertising on streamed video. Zenith predicts the global online video ad market will reach $27.2 billion U.S. this year, an increase from 2016’s $22.2 billion U.S. It should grow by 21 percent in 2018 and 17 percent in 2019, reaching $38.7 billion U.S.