Despite the doom and gloom outlook for display ads, I think the story of 2009 might easily be how publishers will actually yield more revenue by swapping the display ads with video-in-display ads on that same real estate.
And, I’m not alone. Here are some figures from eMarketer:
Let’s look at three places in different segments (technology, news and sports) that are doing this already:
Tech Crunch - Technology
CNN - News
ESPN - Sports
This is exactly what we called for in our 2008 Year in Review / 2009 Year in Preview:
:: 2009: Display Advertising is Dead; Long Live Video Display Ads!
Another major trend we expect to see next year is the death of video-less display ads. Let’s look at a few facts:
- Social networking sites will continue to see eroding sales from advertising: marketers have firmly rejected this notion that social media and advertising go hand in hand. As we have long said: yes, social media has changed publishing, but no, social media is not an advertising friendly trend. Social media is ultimately an oxymoron, we think, social networking is a form of communications, and like email, chat and message board communication, this will not be embraced by advertisers. Look out for more on social media and social networking tomorrow, on Wednesday December 24 2008.
- Traditional display ads won’t cut it: Display banners - the ones and the kinds we’ve become accustomed to - are anything but interactive. Expect more interactivity, namely, more video in it. This bodes well for a player like Klipmart.
- Ad networks under pressure: A lot of the wheelings and dealings in display ads came from ad networks, who will all have to change their business model and adapt to a search and video driven web economy where the value of a traditional display ad will plummet. I stress that a traditional display ad, in my definition, is one next to text content… versus either a a) display ad with a video embedded in it or b) a display ad next to a video player, because a traditional display banner goes unnoticed pretty quickly.
- marketers will ask for more from publishers, and the one asset publishers have is to start including video, either straight video content or video ads embedded in display advertising real estate.
If you are a Fortune 500 marketer looking to get our your message, TV, print and radio won’t be your first choice, but online will be. And when it comes to going online, search does not build a brand or give a marketer the control they want, and nothing will replace video.
:: Video-Powered Display Ads + Video Ads Will Surpass Search Ads by 2010
When you consider the size of TV advertising:
You realize just how big video-related online advertising will be. But the more time I spend working in this space, the more I realize video advertising (as in instream) might be small relative to video-related (as per defined throughout this piece). In this context, I think the sum of all video related advertising is much, much larger than we anticipate and expect.
So to conclude, despite the gloom and doom prognosticators, I think the online media space is going to blow up after February, when a new administration will be swept in and people look ahead to the promise of a new year after the 2008 clusterf*ck to the poorhouse.
Tomorrow, we look at social networking in 2009.
Read the whole piece here, and check out the 2009 Year in Online Video here.
eMarketer’s is pegging online video revenues at $850M in 2009, but I think it is under-estimating the real contribution videos will make to the web advertising total.
eMarketer’s definition of video advertising includes:
- instream ads (suc as preroll and overlays)
- in-banner and in-text ads
By this very definition, all of the companion 300×250 that YouTube serves alongside the videos they host is excluded in eMarketer’s tally. YouTube sells two forms of ads: an overlay and a 300×250 ad alongside ad. While sometimes this 300×250 is a companion ad that is sold along with the pre-roll (something that Tremor Media does, for example), in YouTube’s case (which does not sell any pre-roll ads) the 300×250 would be categorized under display banners.
In other words: the less sold overlay would be included in eMarketer’s ad, but the 300×250 being a simple display ad would not.
Don’t you see a problem?
I think that content is content and if a site plays a video and sells ads around that, that revenue should be allocated to the estimate for video advertising. I don’t think video content’s value is capped to instream and in-banner/in-text ad as eMarketer measures it… by their definition, they are excluding the majority of the revenue on the world’s largest video site.
Something is off there.
eMarketer’s revised projection, benchmarked against the latest Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) data, puts online ad spending at $25.7 billion in 2009. That is only 8.9% over the $23.6 billion that will be spent in 2008.
But when you compare their latest figures with their month-old data, it appears that eMarketer is losing its marbles. Let’s see the latest stats:
Comparing this to previous video estimates, from October 6 2008:
Let’s look at eMarketer’s projections then and now, and interestingly, it seems the 2008 figure has been revised upwards!
In fact, when you break down their earlier projections (from October 6 2008) you will see that in fact, their projections for 2008, 2009 and 2010 have been increased but their projections for 2011, 2012 and 2013 have been decreased. This does not make sense if they are saying that the economy is playing a role. If anything, if the economy were to be blamed, then you would see lower revisions for the short term but higher long term revisions due to online media’s bullish secular trends.
Of course it’s worth adding that this is all after they admitted that their methodology was off and reduced the figure from $1.35B to $550M. But I digress, or not.
This, to me, shows that eMarketer is losing some credibility in the space, frankly. I’d be interested to see their explanation. I am all ears.
Still a lot of uncertainty and hope (hype) surrounding online video. I think in many ways, video is a better fit with display ads whereas video ads work better with text content.
But a new report by eMarketer, as seen on Business Week, released July 16, suggests Web surfers ain’t seen nothing yet. Video ad sales are expected to grow from an estimated $775 million this year to $3.1 billion in 2010 and then to $4.3 billion in 2011. That’s up from a November projection in which eMarketer estimated 2010’s video ad sales at less than $3 billion (see BusinessWeek.com, 11/7/06, “Up Next: Online Video Ad Boom?”).
Though the numbers sound large, the expected activity over the next four years suggests that advertisers will be merely experimenting with the medium. Even at $4.3 billion, spending on video ads would account for just $1 of every $10 of Internet advertising.
Read more.
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