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Augustine Fou- 1 -
Dr. Augustine Fou
http://linkd.in/augustinefou
May 2014
Video Ad vs TV Ad
Spending 2014
Augustine Fou- 2 -
Executive Summary
Branding dollars spent on TV ads today should
shift to online video ads for the follo...
Augustine Fou- 3 -
Device Reach /
Time Spent
Augustine Fou- 4 -
Device Reach
Source: Experian 2014 Digital Marketer Report
Augustine Fou- 5 -
Device Time Spent
Source: Experian 2013
Digital Marketer Report
Mobile
phone, home
computer, and
work
c...
Augustine Fou- 6 -
% of Video Time
Source: Nielsen Cross
Platform Report March 2014
Augustine Fou- 7 -
Consumer Media Time 2014
TV – 4.5 hrs per day
Internet – 2 hrs per day
Video – 26 mins per day
Source: ...
Augustine Fou- 8 -
Time Spent with Video
Implies 0.5 hrs
(30 mins) per day
Augustine Fou- 9 -
Time Spent with Video
1,067
minutes
per month
is the
same as
17.8 hrs
per month
or
36 mins
per day
Augustine Fou- 10 -
Time Spent with Video
1.0 hrs
(55 mins) per day
implies
30.0 hrs per month
Augustine Fou- 11 -
Ad Load
Comparison
Augustine Fou- 12 -
Video Ad Load
5%
Augustine Fou- 13 -
Video Minutes and Ads
Source: comScore April 2014 press release
Viewers watched 1,067
minutes of onlin...
Augustine Fou- 14 -
TV Ad Load
23 - 32%
Augustine Fou- 15 -
Network TV Ad Load
30% ads
• For every 30 minute episode,
there are about 9 mins of ads (or
10 – 12 ad...
Augustine Fou- 16 -
DVR Owners Watch 23m
Source: Nielsen Dec 18, 2013
DVR owners watch 23
mins of 30 minute episodes
Sourc...
Augustine Fou- 17 -
DVR Penetration 7 in 10
Source: LRG via MarketingCharts Dec 2013
Augustine Fou- 18 -
Key Metrics (March 2014 data)
Total ad minutes March 2014 = 10.86B
Total video minutes March 2014 = 20...
Augustine Fou- 19 -
TV vs Digital
Comparisons
Augustine Fou- 20 -
In 2013
Digital marketing was $42B
Broadcast TV was $40B
Cable TV was $34B
TV vs Digital Ad Spend
Augu...
Augustine Fou- 21 -
TV is $69B Digital is $48B
TV vs Digital Ad Spend
TV DigitalPrint Radio
Out-of-Home $8 (5%)
Other $2 (...
Augustine Fou- 22 -
TV Ad Spend Growth
Source: Kantar Media, Dec 2013
Augustine Fou- 23 -
Digital video is 7% of digital
ad spend
Digital Video Format Share
Augustine Fou- 23 -
Source: IAB Ful...
Augustine Fou- 24 -
U.S. Video Ad Spending
U.S. Video
ad spending
to reach
$6B in 2014
Source: eMarketer March 2014
Augustine Fou- 25 -
Video Ad Views Exploded
Source: comScore Feb 2014 via Marketing Charts
Augustine Fou- 26 -
60% Video ad CPMs are in the $8 - $12 range
Video Ad Global eCPM
Source: Turn, October 2013
Augustine Fou- 27 -
Using their databases, they came up
with a 2013 average CPM for online,
in-stream video ads of $23.03....
Augustine Fou- 28 -
Broadcast TV $20 cpm
Cable TV $18 CPM
Radio $5 cpm
Magazines $20
Newspaper $35
Out of Home $4
Internet...
Augustine Fou- 29 -
Video Ad Formats (length)
Source: tnooz.com Feb 2013
Augustine Fou- 30 -
Percent of digital allocated to video ads
- 14.5% auto
- 12.3% Entertainment
- 11.1% retail
- 9.2% CPG...
Augustine Fou- 31 -
Users Pay More Attention to
Online Video Ads than TV Ads
Source: May 2011 report from
YuMe and IPG Med...
Augustine Fou- 32 -
Why TrueView is Awesome
• Advertisers only
pay if ads are NOT
skipped (pay for the
15%)
• Ads are on Y...
Augustine Fou- 33 -
Dr. Augustine Fou – Chief Digital Strategist
“As more users shift their consumption
online, TV adverti...
Augustine Fou- 34 -
APPENDIX
Augustine Fou- 35 -
Time Spent with Media
TV
- 134 hrs/mo (4.5 hrs/day)
Browser/Apps on Smartphone
- 34 hrs/mo (68 mins/da...
Augustine Fou- 36 -
Source: Experian Marketing Services
Mobile still has a long way to go before
it can compete with telev...
Augustine Fou- 37 -
Time Spent on Internet
USA 7.6 hrs /day
Augustine Fou- 38 -
TV Time Trends (down)
Nielsen Cross Platform Report, March 2014
Augustine Fou- 39 -
YouTube Reach
Augustine Fou- 40 -
Time Spent TV vs Internet
In 2013 share of
time spent per day in
Digital
(314 mins or 5.2 hrs)
exceede...
Augustine Fou- 41 -
Time Spent TV vs Internet
Augustine Fou- 42 -
Time Spent TV vs Internet
Time spent online exceeded
time spent watching TV on
TV since 2009
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Video Ad Spending vs TV Ad Spending 2014 by Augustine Fou

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Advertisers should shift more of their ad spend from TV to digital, more quickly to take advantage of the metrics, measurability and improved ROI.

Transcript of "Video Ad Spending vs TV Ad Spending 2014 by Augustine Fou"

  1. 1. Augustine Fou- 1 - Dr. Augustine Fou http://linkd.in/augustinefou May 2014 Video Ad vs TV Ad Spending 2014
  2. 2. Augustine Fou- 2 - Executive Summary Branding dollars spent on TV ads today should shift to online video ads for the following reasons: • Online video ad load is 5% while TV ad load is 23-30% • Users pay more attention to, and skip less, online videos • Advertisers can pay only for ad views that users don’t skip - TrueView (guarantees they watched entire ad) • Online videos can measure interaction and follow-on actions – true[X] • Online videos are proven more effective on all recall metrics
  3. 3. Augustine Fou- 3 - Device Reach / Time Spent
  4. 4. Augustine Fou- 4 - Device Reach Source: Experian 2014 Digital Marketer Report
  5. 5. Augustine Fou- 5 - Device Time Spent Source: Experian 2013 Digital Marketer Report Mobile phone, home computer, and work computer time spent exceeded television time spent in 2013 report
  6. 6. Augustine Fou- 6 - % of Video Time Source: Nielsen Cross Platform Report March 2014
  7. 7. Augustine Fou- 7 - Consumer Media Time 2014 TV – 4.5 hrs per day Internet – 2 hrs per day Video – 26 mins per day Source: Nielsen Digital Consumer Feb 2014
  8. 8. Augustine Fou- 8 - Time Spent with Video Implies 0.5 hrs (30 mins) per day
  9. 9. Augustine Fou- 9 - Time Spent with Video 1,067 minutes per month is the same as 17.8 hrs per month or 36 mins per day
  10. 10. Augustine Fou- 10 - Time Spent with Video 1.0 hrs (55 mins) per day implies 30.0 hrs per month
  11. 11. Augustine Fou- 11 - Ad Load Comparison
  12. 12. Augustine Fou- 12 - Video Ad Load 5%
  13. 13. Augustine Fou- 13 - Video Minutes and Ads Source: comScore April 2014 press release Viewers watched 1,067 minutes of online video in March 2014 (17.8 hours/mo or 36 mins per day) Video ads were in 61.6 percent of all videos viewed and 5.4% of all minutes spent viewing video online March 2014 Data
  14. 14. Augustine Fou- 14 - TV Ad Load 23 - 32%
  15. 15. Augustine Fou- 15 - Network TV Ad Load 30% ads • For every 30 minute episode, there are about 9 mins of ads (or 10 – 12 ads ) – used How I Met Your Mother as proxy 32% ads • For every 60 minute episode, there are about 19 mins of ads (or 20 – 24 ads ) – used 24 as proxy
  16. 16. Augustine Fou- 16 - DVR Owners Watch 23m Source: Nielsen Dec 18, 2013 DVR owners watch 23 mins of 30 minute episodes Source: Netflix
  17. 17. Augustine Fou- 17 - DVR Penetration 7 in 10 Source: LRG via MarketingCharts Dec 2013
  18. 18. Augustine Fou- 18 - Key Metrics (March 2014 data) Total ad minutes March 2014 = 10.86B Total video minutes March 2014 = 200B Total unique viewers March 2014 = 187.8M Ad Minutes per Unique Viewer = 58 mins per user Ad Mins per Unique Viewer per Day = 2 mins
  19. 19. Augustine Fou- 19 - TV vs Digital Comparisons
  20. 20. Augustine Fou- 20 - In 2013 Digital marketing was $42B Broadcast TV was $40B Cable TV was $34B TV vs Digital Ad Spend Augustine Fou- 20 - Source: IAB Full Year 2013 report
  21. 21. Augustine Fou- 21 - TV is $69B Digital is $48B TV vs Digital Ad Spend TV DigitalPrint Radio Out-of-Home $8 (5%) Other $2 (1%) $75 billion 42% $43 billion 24% $32 18% $17 10% Display $8 billion 19% Search $18 billion 43% Video $3 (7%) Mobile $4B$3B display search 17% Other $5 11% Lead Gen $2 (4%) • classifieds • sponsorship • rich media Source: IAB Full Year 2013 report Augustine Fou- 21 - branding performance $34B$40B broadcast cable
  22. 22. Augustine Fou- 22 - TV Ad Spend Growth Source: Kantar Media, Dec 2013
  23. 23. Augustine Fou- 23 - Digital video is 7% of digital ad spend Digital Video Format Share Augustine Fou- 23 - Source: IAB Full Year 2013 report
  24. 24. Augustine Fou- 24 - U.S. Video Ad Spending U.S. Video ad spending to reach $6B in 2014 Source: eMarketer March 2014
  25. 25. Augustine Fou- 25 - Video Ad Views Exploded Source: comScore Feb 2014 via Marketing Charts
  26. 26. Augustine Fou- 26 - 60% Video ad CPMs are in the $8 - $12 range Video Ad Global eCPM Source: Turn, October 2013
  27. 27. Augustine Fou- 27 - Using their databases, they came up with a 2013 average CPM for online, in-stream video ads of $23.03. That seems on the high side in my opinion and they say it is 38% higher than the average 18-49 CPM for prime time cable TV. Meanwhile, network TV was almost double that of online in-stream video ads at $44.11. Network TV CPMs Source: SQAD via ReelSEO March 2014 Network TV $44 CPM In-stream Video $23 CPM Cable TV $15 CPM
  28. 28. Augustine Fou- 28 - Broadcast TV $20 cpm Cable TV $18 CPM Radio $5 cpm Magazines $20 Newspaper $35 Out of Home $4 Internet $11 Direct mail $40 CPM Comparative Media Costs Cost per Thousand (CPM): Cost to reach 1,000 users or impressions Source: OAAA, 2011 Augustine Fou- 28 -
  29. 29. Augustine Fou- 29 - Video Ad Formats (length) Source: tnooz.com Feb 2013
  30. 30. Augustine Fou- 30 - Percent of digital allocated to video ads - 14.5% auto - 12.3% Entertainment - 11.1% retail - 9.2% CPG - 6.9% financial Percent of Digital to Video Source: AdoTube via MarketingCharts March 2013
  31. 31. Augustine Fou- 31 - Users Pay More Attention to Online Video Ads than TV Ads Source: May 2011 report from YuMe and IPG Media Lab
  32. 32. Augustine Fou- 32 - Why TrueView is Awesome • Advertisers only pay if ads are NOT skipped (pay for the 15%) • Ads are on Youtube, which has the industry-leading LOWEST amount of fraud and highest amount of real human audience
  33. 33. Augustine Fou- 33 - Dr. Augustine Fou – Chief Digital Strategist “As more users shift their consumption online, TV advertisers should more rapidly shift ad spend to digital video as well, to achieve a variety of benefits and advantages such as more real-time feedback and conversion metrics.” FORMER CHIEF DIGITAL OFFICER, HCG (OMNICOM) MCKINSEY CONSULTANT CLIENT SIDE / AGENCY SIDE EXPERIENCE PROFESSOR AND COLUMNIST ENTREPRENEUR / SMALL BUSINESS OWNER PHD MATERIALS SCIENCE (MIT '95) AT AGE 23 @acfou ClickZ Articles: http://bit.ly/augustine-fou-clickz Slideshares: http://bit.ly/augustine-fou-slideshares LinkedIn: http://linkd.in/augustinefou
  34. 34. Augustine Fou- 34 - APPENDIX
  35. 35. Augustine Fou- 35 - Time Spent with Media TV - 134 hrs/mo (4.5 hrs/day) Browser/Apps on Smartphone - 34 hrs/mo (68 mins/day) Internet on Computer - 27 hrs/mo (54 mins/day) Watching Video on Internet - 7 hrs/mo (14 mins/day) Source: Nielsen Digital Consumer 2014
  36. 36. Augustine Fou- 36 - Source: Experian Marketing Services Mobile still has a long way to go before it can compete with television for time spent, however. Consumers today spend just over an hour a day using their mobile phones, or seven hours and 50 minutes a week, but they spend more than three times that watching television. In fact, nearly one-in-six adults watch more than 40 hours of television in a typical week. Time Spent (per week) Source: Experian 2014 Digital Marketer Report
  37. 37. Augustine Fou- 37 - Time Spent on Internet USA 7.6 hrs /day
  38. 38. Augustine Fou- 38 - TV Time Trends (down) Nielsen Cross Platform Report, March 2014
  39. 39. Augustine Fou- 39 - YouTube Reach
  40. 40. Augustine Fou- 40 - Time Spent TV vs Internet In 2013 share of time spent per day in Digital (314 mins or 5.2 hrs) exceeded share of time spent on TV (271 mins or 4.5 hrs)
  41. 41. Augustine Fou- 41 - Time Spent TV vs Internet
  42. 42. Augustine Fou- 42 - Time Spent TV vs Internet Time spent online exceeded time spent watching TV on TV since 2009

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