Digital Optimization Video 2013

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Video has emerged from the shadow of digital media options and planted
itself in the center of the advertising ecosystem. Adoption is widespread
as digital video continues to make technological advancements that prove
its effectiveness across a wide range of verticals and advertiser objectives.

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Digital Optimization Video 2013

  1. 1. BrightRoll US Video Advertising Report: April 2013 | www.brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc.US VIDEO ADVERTISING: FIRMLY ROOTED AND GROWINGDIGITALVIDEO 2013
  2. 2. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P2‘‘‘‘This year’s survey validates that video is an established leaderin digital advertising with proven effectiveness, clearer success metricsto measure ROI and continued technological advancementsto meet advertisers’ campaign goals. - Tod Sacerdoti, CEO & FounderI N T R O D U C T I O NDigital video: firmly rooted and growingVideo has emerged from the shadow of digital media options and planteditself in the center of the advertising ecosystem. Adoption is widespreadas digital video continues to make technological advancements that proveits effectiveness across a wide range of verticals and advertiser objectives.No longer do brands consider digital the Wild West and an unknownterritory. They now realize video can complement TV advertising andexpand their reach to an even greater audience across screens –computers, smartphones, tablets and connected TVs.Overall US ad spending is expected to rise 3 percent in 20131while thedigital video ad category is projected to increase 41 percent2. As BrightRollpresents the fifth annual video advertising report, it’s becomingabundantly clear that it is no longer a question of if, but when a majorityof advertisers will adopt video at a much more substantial level intotheir digital advertising budgets.This year’s report is based on survey responses from more than 150executives at top advertising agencies across the US. It reveals key trendsand significant changes in the digital advertising industry. Video and TVare considered less competitive and more complementary ad media whileprogrammatic buying is catching the attention of advertisers and playingan increasing role in media buying this year. Marketers are continuingto expand to multichannel campaigns and targeting and measurementare now even more important when considering the bottom line.
  3. 3. T R E N D I N GVideo in the drivers seatVideo is securely in the driver’s seat as it leads the digital advertising categoryin overall growth. From 2012 to 2013, video saw the greatest increase in spendingamong all US digital ad formats and is expected to reach $4.14 billion by the endof the year2. Nearly half (45 percent) of survey respondents say clients considertargeting the most valuable aspect of video advertising. This is followed by reach(27 percent), continuing a similar trend from last year.1. Which aspect of video advertising do your clients view as most valuable?Interestingly, price relative to TV is still considered the third most important aspectof video advertising (at a distant 10 percent), yet most advertisers find video tobe just as effective as TV. In fact, three in four respondents find video advertisingequally or more effective than TV, a 17 percent increase from last year. Anoverwhelming 91 percent of respondents find video to be equally or more effectivethan display, a response that has grown rapidly year-over-year. This illustrates thatadvertisers are no longer comparing the effectiveness of digital and TV media,but rather the categories of advertising that offer the sight, sound and motion ofvideo, no matter the screen.2. Compared to the following channels, is video equally or more effective?When asked what is the most limiting factor to the growth of video, a thirdof respondents state price is too high, although this is a significant drop of 15percent from 2012. Fewer planning and measurement barriers, greater reach andproven effectiveness have enabled advertisers to embrace video but at the sametime they still need to be sure of its ROI, especially when coupled withTV in advertising strategies.BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P3ReachPrice relative to TVAd unit formatTargeting capabilitiesAbility to reuse creativeOther0%10%20%30%40%50%Reach Price FormatTargeting Creative reuseOtherReachPrice relative to TVAd unit formatTargeting capabilitiesAbility to reuse creativeOther0%10%20%30%40%50%Reach Price FormatTargeting Creative reuseOthermore lessTVDisplay75%91%Social media68%Search52%Direct response45% NoI don’t knowYes
  4. 4. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P4G R O W T HVideo: no looking backSince 2010, a steadily increasing amount of digital RFPs include a video adcomponent. Two out of three survey respondents indicate that half or more of theirRFPs had video in 2012 – up 35 percent since the question was first asked in 2010.3. What % of your digital RFPs included a video ad component in 2012?Since more advertisers are including video in their digital RFPs, it’s no surprisethey also expect to see the largest increases in spending for online and mobilevideo categories, followed closely behind by mobile display. User adoption ofsmartphones has driven the industry to follow consumers to where they areincreasingly engaged. US mobile ad spending is expected to increase 83 percentfor mobile display and 112 percent for mobile video in 20132. On the other sideof the spectrum, TV and connected TV are two categories expected to see thesmallest increase in spending in 2013.4. Which advertising categories do you expect to see the highest and lowestgrowth in media spending this year?2012 was touted as the year of connected TV3. However, as industry standards area frequent topic of discussion, consumer adoption is progressing slowly. Nearly aquarter of all US households currently have and use Internet-connected TV, yet only17 percent of consumers used it at least monthly by the end of 20124. As a result,it’s likely that advertisers are waiting to see how the technology and consumeradoption develop before allocating more significant ad dollars to the device.0% 20% 40% 60% 80%201020120% 20% 40% 60% 80%Less than half of RFPs (0-39%)Around half or more of RFPs (40-100%)2012201035%33%‘‘‘‘The doorsare open forthe growthof videoadvertisingtoday.- Survey respondent’s fill-in answer to the question, “What factor is most limiting to the growth of video advertising today?ConnectedTV|Directresponse|Mobiledisplay|Mobilevideo|Onlinedisplay|Onlinevideo|Searchadvertising|Socialmedia|TVCategories include:17%23%25%15%25%32%Mobile videoOnline videoMobile displayConnected TVDirect responseTVHIGHEST GROWTH(% of respondents)LOWEST GROWTH(% of respondents)
  5. 5. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P5TA R G E T I N G A N D M E A S U R E M E N TA numbers gameWhile targeting is considered the most important aspect of video advertising,behavioral is deemed the most valuable form of targeting according to 36 percentof respondents. Nearly a third of survey respondents say that lifestyle is the typeof behavioral targeting they expect to use most. This might be attributed toadvertisers’ level of comfort with this broad form of behavioral targeting sincethey have used it for many years in TV and print advertising. The technology nowallows advertisers to use this more advanced targeting method for video acrossscreens and ad media, whether it is TV, print or digital.5. What type of behavioral targeting do you expect to use the most in yourvideo advertising in 2013?When asked what form of audience measurement clients value most for videoadvertising, respondents indicate that GRPs/TRPs are most important, a 46percent lift from 2012. This could be attributed to agencies no longerquestioning if video is effective for campaigns and rather asking how video cancomplement TV buys. With GRP planning and measurement, advertisers can ensuretheir ads reach the appropriate target audience and desired number of viewers.6. When it comes to audience measurement, which metric do your clients valuemost for video advertising?TV targetingIn-marketPurchase-based0%5%10%15%20%25%30%35% LifestyleLook alike / spend alikeTV targetingIn-marketPurchase-based0%5%10%15%20%25%30%35% LifestyleLook alike / spend alike%05%10%15%20%25%30%35%40%2012 2013 2012 2013 2012 2013 2012 2013 2012 2013% unique viewers in target % impressions in target GRPs or TRPs I’m not sure Other%05%10%15%20%25%30%35%40%2012 2013 2012 2013 2012 2013 2012 2013 2012 2013% unique viewers in target % impressions in target GRPs or TRPs I’m not sure Other
  6. 6. The calculation is straightforward and in line with TV GRPs. Does this mean that TV GRPs andonline GRPs can be added together and then used for cross-platform delivery? Download theBrightRoll iGRP white paper to learn more about these calculations at brightroll.com/reportsBrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P6I N S I G H TNot all metrics are created equalThere are many options when it comes to success metrics for video campaigns.According to this year’s survey, completed views are again the most importantmetric – a 42 percent increase from last year. At the bottom of the ranking is GRP,accounting for only five percent of responses. This may be due to the industryidea that views, when used as a success metric, are complementary to GRP as anaudience measurement tool. GRP enables advertisers to plan their potential reachto target audiences while views measure the engagement of target audienceswith video ads. It’s a notable dynamic as advertisers buy more on a CPV (cost perview) basis than before5.7. What is the most important success metric for your video campaign?CTR GRPViews Brand lift Sales impact Conversion0%5%10%15%20%25%30%35%40%Following the birth of TV and the adoption of TV ratings, GRP soon became the common currencyfor media planning and reporting. Online video is often compared to TV commercials leading to agrowing demand to apply online GRP (a.k.a. iGRP) to new media. However, there is a fundamentalchallenge: Unlike TV, there is no rating for online content, so how is online GRP calculated?iGRPUNIVERSEIMPRESSIONS*Unique viewers exposed to video adFREQUENCYIMPRESSIONSUVsUVs*UNIVERSE100XTraditional GRP: iGRP:iGRP BUILDS ON THE BASIC MODEL OF REACH X FREQUENCY100X
  7. 7. VideoAdvertisingI N S I G H TReady for researchSearch the web for “video advertising research” and dozens of results will offerbest-practice presentations, studies and articles that seek to answer a marketer’sneed to effectively measure campaigns. Since first asking advertisers three yearsago the areas of research they would like additional research, the responses haveshifted dramatically.This year, the two leading areas are the impact of video on offline purchase behavior(32 percent) and the translation of GRP to online video buying (23 percent). (Thishigh ranking of GRP translation underscores the lead response that GRPs/TRPsare deemed by advertisers as the most important audience measurement.) Alsoimportant to note this year is the selection of the least important area of research:the performance of video compared with TV advertising, down 59 percent fromwhen the question was first asked in 2011. This may illustrate that advertisers areless concerned with the performance of video versus similar media, but are moreinterested in how video can increase ROI.8. In which area of video advertising would you most like to see additional research?0%5%10%15%20%25%30%35%Impact on offline purchase behavior Change in purchase intent or brand lift Online performance vs television advertisingTranslation of GRP to online video buying Audience profiling Brand effectiveness2011 2013 2011 2013 2011 2013 2011 2013 2011 2013 2011 2013Offline impact Purchase intent Performance GRP Brand effectivenessAudience profilesBrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P7
  8. 8. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P8L O O K I N G A H E A DPredictions for programmaticSpending for real-time bidding (RTB) for digital advertising in the US is expectedto increase 71 percent in 20136and survey responses support this prediction. Morethan a third of survey respondents say that around half or more their budgets willlikely be programmatic in the next 12 months. As brands and agencies look formore effective planning and measurement tools, it is likely they also need a moreefficient solution to identify and reach target audiences at scale.9. What percent of your overall digital budget do you expect to be programmaticin the next 12 months?As advertisers migrate to programmatic buying to maximize efficiency, theyare focused on opportunities of this solution that offer the greatest campaignbenefits. According to respondents, pricing efficiency (34 percent) is consideredthe top benefit for programmatic buying of digital advertising, which is not asurprise as media costs are always at the forefront of advertisers’ minds. Thisis followed by targeting (27 percent), optimization (16 percent) and audienceefficiency (12 percent). With the forecast for tremendous growth of RTB andprogrammatic solutions this year, it will be interesting to watch how thesebenefits may shift or if specific efficiencies rise to the top as the market matures.10. In your opinion, what are the key benefits to programmatic buying fordigital advertising?Small minority (0-19%)Minority (20-39%)Around half (40-59%)Majority (60-79%)0%10%20%30%40%50%Large majority (80-100%)(0-19%) (20-39%) (40-59%) (60-79%) (80-100%)Categories include:16%27%34%Programmatic BuyingKey BenefitsUniversal frequency cappingPricing efficiencyTargetingOptimizationAudience efficiencyTime savings12%The practice ofautomating thebuying of onlineads by usingalgorithms to drivethe best possibleprice for eachimpression. Thisoccurs in real time,on demand and onan impression-by-impression basis. - Goldman SachsWHAT I SP RO G R A M M ATI CB U Y I N G?Small minority (0-19%)Minority (20-39%)Around half (40-59%)Majority (60-79%)0%10%20%30%40%50%Large majority (80-100%)(0-19%) (20-39%) (40-59%) (60-79%) (80-100%)Categories include:16%27%34%Programmatic BuyingKey BenefitsUniversal frequency cappingPricing efficiencyTargetingOptimizationAudience efficiencyTime savings12%Categories include:16%27%34%Programmatic BuyingKey BenefitsUniversal frequency cappingPricing efficiencyTargetingOptimizationAudience efficiencyTime savings12%
  9. 9. Greater efficiencyE D U C AT I O NEfficiency prophecyWith the growth of programmatic buying for video and the proliferation ofpublishers, ad networks, demand side platforms and exchanges, it’s no surprisebrands and agencies are increasingly questioning how to best create efficienciesacross all of their campaigns. To address this, some buyers are consideringsingle platform solutions.Moving to a single platform for video promises to provide efficiency to streamlineprocesses and maximize ROI by delivering one point of contact for inventory, adserving, targeting, optimization and unified reporting across screens. In supportof this, 43 percent of survey respondents say they are somewhat likely or likely toconsolidate all or a portion of their budget to a single platform, while 46percent indicate they are unlikely to do so. This may be attributed to a a need forfurther education about the benefits of using any particular platform for all or amajority of an advertiser’s video buying.11. How likely are you to consolidate all or a large portion of your digital adspending on one platform?UnlikelySomewhat likelyLikelyI don’t know0%10%20%30%40%50% UnlikelySomewhat likelyLikelyI don’t know0%10%20%30%40%50%BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P9
  10. 10. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P10C O N C L U S I O NFast times in digital videoThe digital ecosystem is rapidly changing with video leading the way. Thenumber of video ads served from 2012 to 2013 increased 64 percent7. Thistrend won’t likely slow down as more brands and agencies are embracingdigital video and realizing how it enhances digital advertising strategiesand bottom lines.Technological innovations in digital video are rapidly advancing planning,targeting and measurement capabilities. These have the benefit of notonly arming advertisers with more effective tools, but also enabling videoto be the greatest category of growth in digital advertising2. Accordingto respondents, video has proven its effectiveness and has been foundin other studies to be viewed as more complementary to TV advertising.Video ads can actually increase the efficacy of TV spots: 29 percent ofviewers who were exposed to both online video and TV ads recalled themessage versus 19 percent that viewed the TV ads alone, a 53 percentincrease in message performance8.While the conversation about video and TV has shifted, the value foundin advanced targeting, especially behavioral, and the importance ofaudience measurement through views still remains a big priority toadvertisers. They seek to better understand GRP to more accurately plantheir digital campaigns, while views help them measure campaign successthrough audience engagement. As digital video advertising solutionscontinue to evolve, programmatic buying is at the forefront of helpingadvertisers save time and money. The value of single platform mediabuying solutions will be a key trend to watch over the next 12 months tosee how they gain traction and become more prevalent in the industry.Eighty-five percent of the US Internet audience viewed online video inMarch 2013 and video ads accounted for 25 percent of all videos viewed9.It’s clear video has staying power and can have a major impact whenincorporated into a larger advertising strategy. Brands and agencies aretaking advantage of the benefits video offers but are still eager for furtherinnovation and advancement to continue to achieve campaign goalsand drive ROI.‘‘‘‘Programmaticbuying is atthe forefront ofhelping advertiserssave timeand money.
  11. 11. BrightRoll US Video Advertising Report: April 2013 | brightroll.com | 415.677.9222 | 343 Sansome Street, Suite 600, San Francisco, CA 94104 | Copyright ©2013 BrightRoll, Inc. | P11G R A P H S & C H A R T S1. Which aspect of video advertising do your clients view as most valuable? P32. Compared to the following channels, is video equally or more effective? P33. What % of your digital RFPs included a video ad component in 2012? P44. Which advertising categories do you expect to see the highest and lowest growth in media spending this year? P45. What type of behavioral targeting do you expect to use the most in your video advertising in 2013? P56. When it comes to audience measurement, which metric do your clients value most for video advertising? P57. What is the most important success metric for your video campaign? P68. In which area of video advertising would you most like to see additional research? P79. What percent of your overall digital budget do you expect to be programmatic in the next 12 months? P810. In your opinion, what are the key benefits to programmatic buying for digital advertising? P811. How likely are you to consolidate all or a large portion of your digital ad spending on one platform? P9C I T I N G & S O U R C E S1 eMarketer: https://www.emarketer.com/coverage/advertisingmarketing.aspx2 eMarketer: http://www.slideshare.net/eMarketerInc/emarketer-webinar-trends-in-video-advertising-and-measurement-161632953 Reel SEO: http://www.reelseo.com/ces-2012-connected-tv-advertising-begins/4 eMarketer: http://www.emarketer.com/Article/Connected-TVs-Reach-One-Four-Homes/10095815 IAB/Break Media Digital Video Advertising Trends: 2012: http://www.iab.net/media/file/BreakMediaDigitalVideoStudy2012.pdf6 Forrester Consulting: RTB Powers The Rapid Growth Of Online Video: http://www.spotxchange.com/images/documents/reports/SpotXchange-RTB-Powers-the-Rapid-Growth-Of-Online-Video-Forrester-TLP-April-2013.pdf7 comScore Video Metrix Key Measures, Jan. 2012 – Jan 20138 Nielsen/IAG Microsoft Advertising Video Effectiveness Research Report: http://www.iabcanada.com/wp-content/uploads/2011/09/NielsenIAG_MicrosoftAdvertising_VideoEffectivenessReport_2011.pdf9 comScore Video Metrix Key Measures, March 2013A B O U T B R I G H T R O L LBrightRoll is the largest independent video advertising platform for reaching audiences across web, mobile and connected TV.The company powers digital video advertising for the world’s largest brands including 90 percent of the top 50 US advertisersand 17 of the top 20 advertising technology companies. The platform enables advertisers to reach 4 in 5 video viewers online andconsistently ranks among the top two video ad platforms in ads served. As a result, BrightRoll technology collects and analyzeshundreds of billions of data points monthly enabling real-time decisions that drive ROI for advertisers.

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