57% video ad revenue on Facebook, YouTube by 2018
September 17, 2015
In 2015, 36.5 per cent of all European advertising revenue will be generated online. In many Western European markets, online is already the largest advertising medium and still growing strongly according to an IHS report. However, online advertising faces many challenges including ad blocking, viewability and ad fraud, as well as a lack of standardisation in online measurement. With the rise of video, online advertising is no longer just a performance-driven format. Brands want to be more involved in shaping their digital future.
The rise of online video:
European online video will grow 18.8 per cent in 2015. As traditional TV experiences increasing dents in their audience from strong OTT players like Netflix, many brands are slowly migrating their ad budgets to online video. However, as online video grows, technology giants Google and Facebook will be the main beneficiaries.
IHS predicts that by 2018, 57.2 per cent of online video advertising revenue in the European Big 5 (France, Germany, Italy, Spain, UK) will be generated by Facebook and YouTube. Traditional media owners are beginning to equip themselves with advertising technologies (e.g. RTL’s acquisition of SpotXchange, ProSieben’s acquisition of Virtual Minds).
The rise of automation:
Programmatic buying, or the automation of online advertising are a key focus at Dmexco 2015. In 2015, IHS expects 47 per cent of all European online display advertising to be traded programmatically, with that number reaching 72.8 per cent by 2020. All media companies are now expected to provide advertising technology solutions and even traditional broadcasters, which have been the slowest to get onboard, are now speaking knowledgeably about programmatic.
Consolidation in advertising technology is now in full swing (the most recent being Verizon’s AOL acquired mobile ad network, Millennial Media) and IHS expects to see more of this throughout 2015.