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Online video - nirvana for brand advertisers

For brand advertisers, there is no media more effective than online video. The efficacy of online video has been quantitatively confirmed in a number of ad effectiveness studies conducted around the world. A recent Nielsen analysis, demonstrated that online video was 100% more effective in improving brand metrics than TV. In 2011, a Dynamic Logic MarketNorms study analyzed data across numerous clients and campaigns to reveal that online video outperformed both display and rich media on every metric, and was 150% more effective at raising ad awareness.

While research consistently shows TV ad effectiveness is declining, counter-intuitively, TV ad revenue has seen a 40% increase over the last decade. Advertisers are paying more and getting less with the average cost-per-viewer continuing to climb. Similarly, spending on display advertising and rich media is disproportionately high. According to the IAB approximately 30% of online advertising dollars being spent on the two formats combined, compared to only 6% spend on online video.

"The efficacy of online video has been quantitatively confirmed in a number of ad effectiveness studies conducted around the world."

Additionally, video enables far more effective frequency capping while simultaneously enabling advertisers to find hard-to-reach viewers.

A recent TV/Internet fusion study conducted by Nielsen demonstrated that online video is more efficient than TV, delivering more than 3% incremental reach when combined with TV, compared to just TV alone within the same budget.

The opportunity for advertisers to leverage video in a far more meaningful way is enormous and very real. Video is ready for prime time.

The video ecosystem is complex

Video advertising is becoming increasingly complex as publishers look to maximize the value of their inventory, content creators search for ways to protect and monetize their assets, and advertisers demand better targeting, better performance, and better brand safety.

The enormity of the opportunity has created a competitive and crowded market making life increasingly complicated for advertisers and agencies. Online video is an industry being driven by technological advancements and the rate at which the landscape is changing can be daunting for any advertiser. It is difficult to find enough resource, time, and expertise to take full advantage of all these rapid changes.

Video buying is currently dominated by a restrictive TV-style strategy

Most advertisers and agencies are still thinking about video advertising in the way they consider TV advertising – from a content perspective. The starting point for many video media plans tends to be the publisher property and the reach that property can deliver.

Unlike TV, the online video audience is highly fragmented across the digital landscape bouncing between publishers, content, and devices. Achieving effective reach and frequency is not as simple as choosing a few publishers and plastering them with video ads.

The power of online video is that advertisers have the ability to accurately target an audience, right down to individuals, wherever they are online. Video media planning should start with the audience, not the publisher or the content. More and more video advertisers now understand that they should follow their audience online.

High quality, brand-safe video inventory is still scarce

The majority of online video advertising bought today is from premium publishers. This has driven up CPMs and resulted in many publishers being regularly oversold . The efficiency of video often gets compromised in this scenario and leaves advertisers dissatisfied and frustrated.

Advertisers that are engaged in real-time bidding via DSPs & Exchanges are limited to bidding through each DSP individually rather than being able to bid across multiple DSPs simultaneously, effectively missing out on a large percentage of available inventory.

Blind networks, where the majority of video and display inventory sits are increasingly off-limits for most brand advertisers concerned with the lack of visibility and control. Achieving brand safety within these networks is traditionally difficult and impossible to guarantee.

This all adds up to a market with limited supply and growing demand, making video advertising out of reach for many advertisers concerned with efficiency and reliability.