What We Know About Mobile Video Advertising Spending

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Kevin Ford

June 18th, 2019

What are the latest mobile video ad trends occurring right now? eMarketer released a new report on the ad landscape for mobile videos. This report takes a closer look at how ads are played in the U.S. This is the home of some major players in the technology field.

So, what are the newest trends found in the country? More importantly, how do they impact the more massive global advertising industry?

Let’s take a closer look at the report and examine the four things we know about what’s happening now and what’s about to occur in relation to mobile video advertising.

1. Mobile Devices Use the Majority of Digital Ad Spending

It’s vital that we discuss the importance of mobile video ads, but first, you must understand how gigantic the industry is in the United States.

In the eMarketer report, we see that advertisers are estimated to spend about two-thirds of their digital budget on mobile spots during 2019. That’s 67% of digital ad spending going directly to mobile devices. This accounts for mobile phones, tablets plus other internet-connected equipment that’s portable.

This change initially took place back in 2014. At that time, industry estimates show 62% of ad budgets being used on desktop computers, laptops and other stationary devices. For 2015, companies planned to make the shift into mobile advertising.

Nowadays, smartphone ads are accepted as the primary digital marketing campaign. Considering this information, it makes complete sense that mobile video advertising has done so well on these platforms.

2. Digital Video Ad Spending is Led by Non-Mobile Video

We’ve discussed how mobile video advertising is benefitting from the shift; it’s not exactly the dominant aspect of digital video ad spending.

Right now, the video ad industry is very strong. It’s estimated at $36 billion. Advertisers in the States are expected to spend over $16 billion with mobile video ads and more than another $19 billion elsewhere during this year. This shows that only 46% of the budget will go towards mobile.

You have to wonder why this is true. We don’t have the exact answers, but it’s clear that advertising spending is conservative. For one reason, it’s much easier to have people view the ad on Twitch or YouTube from a laptop or PC that’s connected to the Internet than from a portable device with mobile data.

Another reason is that digital video advertising is in the middle of a transformation. There’s so much happening in the wider ad space right now. Overall, we will continue to see the shift further into mobile video. In fact, eMarketer stated that by 2023, it will be the dominant avenue for spending.

By investing in mobile video today, advertisers gain the advantage over their competition.

3. Social Video Depends on Mobile Ads

If you want to know what the secret is to success with video advertising, you must look at social media. A total of 93% of video ad spending with social video platforms is done through mobile placements. That’s almost all of it plus it’s mainly driven by Google and Facebook.

These two will make up about 60% of the entire digital ad spending this year. Examining how each of these benefits from the video ads, it’s clear to see that video ads and social media will continue to be a strong relationship in the years coming.

4. TV Advertising Remains Strong Which Slows Down Mobile Video Spending

So, what is slowing down the growth of mobile video ad spending? Right now, TV advertising is playing a role.

During the end of 2018, connected TVs accounted for more than 40% of digital video ad impressions. Furthermore, Hulu plans to gross about $2 billion through ad revenues this year.

It’s vital that advertisers pay attention to video and streaming platforms. eMarketer discusses The Roku Channel, Amazon and Twitch in this category. The Roku Channel provides free content supported by ads to their 22 million users. Amazon also has expanded the ad-supported market with its IMDb Freedrive.

Is this going to be a problem for advertisers? It’s possible. Still, new developments are around the corner geared to bridge a gap between the platforms. Even Google’s new Stadia gaming program might be helpful.

If TV advertising continues to be dominated by connected devices and mobile apps, then it’s crucial that advertisers adjust their advertisements accordingly. This leads to ad spending through both avenues to increase. The broad coverage also ensures that the ads are being viewed.

Final Thoughts

Despite the popularity of mobile devices in the U.S., we will continue to see a strong, but small hold of the ad market through non-mobile advertisements. In the next few years, we will see a considerable shift occurring and mobile is going to become the dominant platform by the beginning of 2020.

The biggest hindrance in mobile video becoming the major player is video streaming through connected TVs. Hulu, NBC, Amazon and Twitch all continue to pour money into the video platforms that are ad-supported.

As people continue to watch content on their connected TV, these video services will only gain more traction. With that said, casting devices and digital assistants will make it simpler for people to swipe videos on a phone, leaving the market open for more digital ads. This also means that OTT and mobile spaces will come together, allowing both avenues to benefit.

Kevin Ford

2019-06-18

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