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Video May Present Growth Opportunity, but Alarm Bells are Ringing

Video May Present Growth Opportunity, but Alarm Bells are Ringing

Video could represent the key to improved display ad revenue if the channel can iron out some of its early creases. 

That’s the salient point from a new survey led by video ad group Teads, conducted on agencies, advertisers and publishers across the world, which exposed some of the qualities of video’s early proposition as well as some of the factors likely to hamper its growth.

In voting for the “main benefit” of video advertising for their organisation, 44% of publishers and media companies cited the opportunity for higher cost per mille (CPM) charges on ad space. 

With 70% of agencies and 77% of advertisers expecting video ad budgets to increase over the next two years, it’s understandable that publishers may be looking to place higher charges on their video inventory. 

Unfortunately, buyers are still looking for more from the channel at present. Half of agencies (50%) said not being able to tell whether an ad had reached the intended audience would inhibit adoption, with 46% of advertisers saying the same. 

A lack of established standards for ad measurement was picked up on by 43% of agencies and 36% of advertisers respectively, with a demand for best practices cited by 42% and 33%.

Pros and cons

Despite the opportunity to charge a higher CPM, media companies are also growing wary of the ROI gained from their inventory. For 44% of publishers, it’s the cost of producing video content that may be preventing the return.

Additionally, video isn’t being allowed to shine in some respects due to a lack of resource dedicated to it, as Teads found out.

But what the survey did make clear is that video could still represent a valuable long-term proposition for publishers and media firms. 

Nearly a third (29%) of those selling video inventory said that clip-based advertorial handed them the chance to provide more engaging ad content to their audience. Further to this, video presented the opportunity to draw spend from non-digital ad budgets - such as TV (19%).

That being said, experts have previously stated that digital video marketers have a great deal to address, in areas such as viewability and understanding the audience, before their channel can become a genuine competitor to the television.

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Richard Towey

Richard Towey

Richard serves as head of content at PerformanceIN. After many years spent covering developments from the automotive, sports, travel and finance sectors, he eventually turned his full attention to reporting on stories from the fast-evolving world of digital marketing. Richard now heads up the editorial team at PerformanceIN: the performance marketing industry's leading publication.  

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