Agency Sees Ad Dollars Moving to Digital Video - Multichannel

Agency Sees Ad Dollars Moving to Digital Video

Zenith Outlines Challenges for Mobile Marketing
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A leading media agency, in a new report, predicts that as usage of new media technology grows, advertising dollars will shift from traditional TV to online video.

"Video continues to be the fastest growing segment of digital advertising, with average CPMs (costs per thousand viewers)  hovering around $26. More advertisers are moving TV dollars over to online video as a way to expand the supply pool of video and contain TV CPMs," according toZenithOptimedia in its New Media Forecasts report. "We expect this trend to continue as online video adoption continues to rise, fuelled by more content becoming available through more devices."

The agency says retail, financial services, telecommunications and automotive are the leading categories for digital advertising. But it seee growth in the coming years in other categories. "Consumer packaged goods and entertainment have taken to video in a big way as it enables them to use sight, sound and motion to convey an emotionally charged message. Again, we expect this trend to continue as more advertisers shift TV dollars to video in an effort to optimize their mix and follow the consumer," according to the report.

Zenith forecasts that the percentage of American home broadband users will continue to grow from 69.6% in 2013 to 72.9% in 2015. Spending on Internet video/rich media is expected to rise to $5.2 billion in 2013 in 2013 to $8.2 billion in 2015.

The agency sees smart phone penetration jumping from 42.4% in 2013 to 58.6% in 2015. For tablets, Zenith estimates penetration growing to 19.4% in 2013 to 26.1% in 2015. IPTV will be in just 6.8% of U.S. homes in 2013 and 7.7% of homes in 2015.

Read more at B&C here.