This is a guest post by Samantha Merlivat, a researcher serving Marketing Leadership professionals.
Forrester’s Western European Online Display Advertising Forecast projects that online display advertising spend will rise at a CAGR of 10.3% between 2014 and 2019, jumping from €7.3 billion to €11.9billion. Two factors will account for the double-digit growth rate:
Mobile display will pick up quickly over the next five years, with tablet taking off full speed in virtually every European market. With their larger screen real estate and growing role in customers’ path to purchase, tablet-based ads will grow at a 40.5% CAGR over the period, attracting a third of total online display revenue by 2019.
Video and rich media formats are also growing strong. Video in particular will increase 20% annually over the next five years. Attracted by the higher opportunities for story-telling and building engagement, marketers will be willing to invest higher CPMs in these formats.
This week, Facebook announced its rollout of auto-play advertising videos – starting with a teaser for the upcoming movie Divergent. The video ads automatically start playing, without sound, when they appear. Users can click on the video to view it with sound or scroll past it if they aren't interested.
Video definitely has the future. In a blog post by my colleague Michael O’Grady last year, he revealed that video was the fastest-growing digital content category. The Forrester Research Online Display Advertising Forecast, 2013 To 2018 (Western Europe) shows that European Internet users spent 68% of their online time in 2012 watching online videos, and we expect more than 90% of the online population to watch online video regularly by 2017. As a result, video advertising will account for a third of total display advertising spend in 2018.
Earlier this month, Corey Kronengold at Online Video Watch was complaining about the in-stream ad load at MLB.tv. But unfortunately for Corey – and for the other two-thirds of US Internet users who now watch online video – the ad load seems likely to get heavier rather than lighter.
In the fourth quarter of 2009, my team and I spent at least 30 minutes watching video on each of 84 leading sites in the US and Europe to better understand how marketers and sites are deploying online video ads – an exercise I’ve conducted each of the past three years. What did we find? Advertising, and a lot of it. In fact, 85% of US web sites and 64% of European sites now accept in-stream ads. And we saw more advertising per online video hour than ever before.