Mobile video has been growing steadily for years, but it is now close to justifying the hype that it generated throughout the years. Mobile video ad spends in the U.S. more than doubled from 2013 ($720 million) to 2014 ($1.5 billion) and will reach $6 billion in 2018, representing about half of the total online video ad spend.
The growth in mobile devices, broadband coverage and 4G services, device screen size and video consumption on mobile devices are the first apparent drivers. Other, less visible drivers relate to the way users consume video on mobile.
Since in-app video inventory is usually more engaging and can be coupled with more data, it is valued higher than mobile web video inventory. More users are watching video on tablets than on smartphones, which is another contributor to the bottom line since we see that tablet video ad inventory is usually 30-50 percent more expensive than smartphone video inventory.
Video ads are usually a brand awareness play, and the big brands behind the ads prefer to have their name associated with premium content. They also understand that users’ attention is shifting to mobile, especially to applications. However, while their traffic shifts from desktop to mobile – it mostly turns to mobile web, and apps still account for a small portion of their mobile inventory.
And so publishers are trying to compete on users’ attention by reimagining themselves in mobile environments. This will no doubt be including a mobile-specific video consumption experience. Better mobile-specific content and environment, along with first-party data that these large publishers can apply for targeting in their properties and beyond will contribute to increasing CPM rates.
They used to say ‘if you’re not online, you don’t exist’. From 2018 onwards we will say ‘if you don’t use online, you don’t exist’. That means you MUST make the most of every opportunity you can grab online. You must make videos to promote your services or products. You must start using Virtual Reality videos and 360 degrees photos. You must use social media in a targeted way. Otherwise, you will be put out of business by savvier competitors. Seems complicated? Just ask how we can help. We can assist you with multimedia services to take some of the burdens off your shoulders. Contact us today.