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Video advertising has had another stellar year in terms of revenue and yield as advertisers increasingly deflect spend from other channels such as free-to-air TV and print.
According to the second annual State of the Video Industry report, released by the Interactive Advertising Bureau (IAB) Australia and AOL division, Adap.tv, the Australian online video advertising market grew 78 per cent in the last financial year.
Buyers almost all increased spend on digital video, with an estimated rise of 34 per cent this year, and spending is expected to increase by 37 per cent in 2015.
According to the recent IAB and PricewaterhouseCoopers report, <i>Online Advertising Expenditure Report</i>, video advertising was worth $196 million in the 2014 financial year.
Publishers also reported inventory levels rose 42 per cent over the same period, and nearly two-thirds have seen their CPMs increase by 25 per cent or more in the last 12 months.
Mobile was not surprisingly, the bigger growth engine and more than 80 per cent of buyers were purchasing mobile video inventory.
The report also found 66 per cent of Australian advertisers had shifted their media spend from free-to-air TV in order to take advantage of online video opportunities. Other channels losing out to digital video included print (45 per cent) and online display (36 per cent).
In addition, 84 per cent of buyers were still purchasing direct from publishers, 66 per cent through demand-side platforms, and 55 per cent through ad networks.
However, inventory availability is proving a key issue - for 88 per cent of buyers at least. Long-form content was the most scarce of the formats.
“Publishers tell us inventory levels have risen 42 per cent in the last year, while fill rates have also increased,” IAB Australia CEO, Alice Manners, said in a statement. “That shows the insatiable appetite for video content. We can expect inventory levels will continue to increase over the next few years with particularly strong demand for long-form inventory and Australian content.”
About 20 per cent of inventory is being purchased programmatically and more than 60 per cent of publishers are making inventory available in these environments, the report stated.
Adap.tv’s managing director, Mitch Waters, said the report demonstrated how important data is in making purchase decisions around online video. Eight-four per cent of agencies, for example, said they were using data targeting to make video buying decisions in Australia.
“Programmatic trading in enabling buyers to develop an increasingly sophisticated and accountable approach to their buying, while giving publishers immediate intelligence on the sort of content that is in-demand and providing the highest yield,” he said.
The IAB/Adap.tv Australian report is based on a survey of 130 publishers, agencies and marketers in July and August 2014 and comes out of a larger survey of 800 individuals worldwide.
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