AOL looks to TV budgets

25 September 2013
NEW YORK: AOL has struck a series of deals with advertising agencies which have made commitments to buying online ads in 2014, due in part to the continuing shift of ad dollars from TV to digital video.

Tim Armstrong, the online media firm's CEO, made the announcement during a "programmatic upfront" at New York's Advertising Week event.

"We're seeing single-digit ad dollars starting to move from TV to digital video," he said, in remarks reported by Ad Exchanger. "Two years ago, a lot of people met to talk about TV/online video convergence, but it was just talk, no action. That's changed this year."

Meanwhile, Ran Harnevo, senior vice president of video at AOL, was more specific as he told the Wall Street Journal that around a quarter of the company's online video advertising commitments for 2014 had come from television budgets. This total compared with just 5% a year earlier. "I've met more TV buyers in the last six months than in the last six years," Harnevo said.

One problem he will have to deal with, however, is that he "does not have enough inventory" to fill the demand for online video. Currently about 5% of AOL's video-advertising inventory comes from its own content, with the rest from third-party publishers syndicating their videos.

Among the agencies signing up to the placement of ads on AOL through automated exchanges were Accuen, Amnet, Havas Media, Horizon Media and Magna Global.

Media buyers are attracted by the convenience offered by programmatic buying, a trend which is only going to accelerate as more sophisticated systems develop. "Increasingly, programmatic tools allow you to [buy ads] across linear TV and digital video," said Amir Ashkenazi, CEO of Adap.tv, the video advertising platform recently acquired by AOL.

Anthony Riscato, general manager of rival VideoHub, highlighted the value of analytics to marketers.

"It's not just about getting a video ad from point A to point B," he said." The bottom line is, what is the marketer getting out of that spend? That's what makes the difference when it comes to how video budgets get allocated."

Reports from Advertising Week will be available in Warc's Event Reports section later this week.

Data sourced from Wall Street Journal, Ad Exchanger; additional content by Warc staff
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