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Mobile video leaps ahead

News, 19 July 2016

GLOBAL: Consumers around the world will this year spend 23% more time viewing video on mobile devices than on 'fixed' devices, according to a new forecast.

The second edition of Zenith's Online Video Forecasts report covering 57 key markets predicts that, in 2016, people will spend an average of 19.7 minutes a day viewing online videos on their mobile devices (smartphones and tablets), compared to 16.0 minutes on fixed devices (both desktop computers and smart TV sets).

This represents a 39% leap for mobile on last year's figures, Zenith said, while fixed video consumption will be static this year – with higher viewing on smart TVs offset by the shift from desktops to smartphones and tablets.

There are several factors driving this rate of growth, including the rise in mobile ownership around the world as low-cost devices become available in emerging markets, and the spread of high-speed data connections, particularly 4G.

Zenith expects that mobile video consumption will continue to grow rapidly – at 33% and 27% in the next two years – and will reach a total of 33.4 minutes a day in 2018. During the same period, fixed video consumption will edge upwards to a total of 18.7 minutes.

The significantly faster growth rates of mobile mean that in 2018 mobile devices will account for 64% of all online video consumption.

Consumer behavior may be changing rapidly, but adspend will be slower to follow suit, partly because video ads are more engaging and effective on larger screens, so advertisers will continue to pay a substantial premium for fixed video ads.

Fixed video ads will account for 68% of all online video advertising in 2016, down from 75% last year, said Zenith, adding that mobile and fixed would be equal in 2018.

In terms of actual spending, advertisers paid out $17.5bn on online video ads in 2015, a sum which is projected to hit $30.1bn in 2018, with online video's share of digital display adspend increasing from 26.7% to 31.3% over that time.

Zenith also observed that online video can add incremental reach to television campaigns, but advised against simply reusing television ads. Shorter ads are more effective, or ads that extend the story of the television campaign.

Data sourced from Zenith; additional content by Warc staff