Study: A Majority of Buyers Did Not Attend the Newfronts

/ Oct 22, 2013

VideoInk-Standard_NewfrontsLogo

This morning, Adap.tv released its semi-annual “State of the Video Industry” report, which looks to provide a snapshot of video ad trends in the US. It’s a very dense report, and something you should check out in full if you want to know what a cross-section of the digital video ad industry is thinking, but here are some of the highlights:

Are the Newfronts working? Kind of not really, but that doesn’t mean they won’t down the line: According to the study, 77% of video ad buyers attended the TV upfronts this year, while an undisclosed “majority” did not attend the Newfronts. If the point of the Newfronts is for the online video industry to come together and convince TV buyers (who have the deepest pockets) that their stuff is worth buying, then this demonstrates how much work still needs to be done.

Though, per the report, 22% of video buyers who did attend the Digital Newfronts reported that the event “made them realize the importance” of locking up premium video ad inventory in advance, and a “majority” said it made them more aware of how much creative inventory exists in digital. In addition, 14% of buyers who attended the TV upfronts only purchased online inventory, 22% only purchased TV inventory, and 65% went in specifically looking for cross-screen inventory. So while TV is still king, this seems to indicate a growing comfort among buyers for digital inventory, which should be good news for Newfront presenters. But sometimes I’m an optimist.

Yes, there is growth in digital video ad spending, but everybody relax: Brands increased their video ad budgets by 65% in 2013 when compared to 2012, while agencies increased budgets by 83%, and DSPs and ad networks increased by 58% and 59%, respectively. While brands and agencies are still looking at broadcast TV budgets to fund the increase in video ad spend, they’re more likely to target their search (26% of brand and agency respondents) and out-of-home budgets (42%). What’s more, 42% of video buyers said there had been “no shift” in their broadcast spending, while 45% reported a 1-10% shift. So while dollars will move, it’s likely that they won’t move as fast as some digital video sellers would like.

What’s standing in the way of digital video? This word cloud:

adaptvreportwordcloud

While video is clearly important for both buyers and sellers, buyers are really concerned by measurement, while sellers see mobile being big in 2014. That’s not to say sellers don’t care about measurement and buyers don’t care about mobile (they clearly do). But solve the measurement puzzle, and a lot more spend will go toward native online video. Obviously, that’s a lot easier said than done. Per the report, 70% of agency respondents and 65% of brand respondents said existing measurement standards do not satisfy their need for audience guarantees. Why not? Many of them are not confident in the methodologies that exist today (agencies: 40%; brands: 34%).

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