LONDON: Online video advertising is evolving rapidly as it moves beyond standard formats, but the industry remains overly dependent on TV assets, according to an industry figure who argues that advertisers need to think digital-first.
Writing in the January issue of Admap, Simon Stone, commercial director at Collective UK, highlights some of the findings from a recent Collective survey of the UK online video advertising market and identifies trends for the year ahead.
He observes that while the market overall is growing, average budgets are declining – an indication that "buyers are investing in more strategic and varied video solutions, rather than larger traditional pre-roll allocations".
Alongside this development, video budgets are increasingly being directed to digital teams rather than TV – with 73% of digital buyers investing in video in 2016, up from 56% in 2015 – partly a consequence of the number of alternative formats now available.
However, even though advertisers are taking advantage of more varied digital video solutions, "the industry remains heavily reliant on using TV assets online rather than developing more bespoke creative", Stone says.
Just over half of respondents in the Collective survey said that under a quarter of their online video campaigns featured made-for-digital creative.
"Looking to the future, as creative agencies and advertisers realise the benefit of digital-first video content in terms of better audience engagement, it is likely this figure will rise considerably in the coming years," Stone predicts.
Another challenge, he adds, will be to prove the effectiveness of video advertising. View-through-rates have become the primary metric (cited by 52% of respondents, up from 35%) while the importance of incremental reach has declined (from 25% to 14%).
But demonstrating proof of effectiveness remains a key requirement for 27% of respondents, "revealing that showing how video contributes to econometrics, sales and brand performance is vital to fuel future growth of the market".
Readers can download a chapter of the Warc 2017 Toolkit: How video is transforming social marketing.
Data sourced from Admap