Majority of Online Video Spend Is Coming from TV and Display Budgets

/ Jun 5, 2013


One of the central goals of the annual Digital Content Newfronts is for the top web video companies to present their content and ad packages in order to get access to that all-important TV dollar. This was never more apparent than during AOL’s Newfront presentation, which consisted of a series of upfront-like previews from the stars of upcoming AOL shows as well as a couple of deals AOL announced with Nielsen, FreeWheel, and MediaOcean.

During the Newfront, AOL also unveiled Be On, a new “end-to-end” branded content platform that helps advertisers create, syndicate, measure, and analyze premium video content across digital platforms.

Be On also includes a research element, which has just come out with a study that says the majority of online video spend is coming from budgets previously reserved for TV and display ads. The study surveyed 770 industry types from brands, media, and creative agencies in North America, the UK, and the rest of Europe. Here’s what it found:

  • 73% of respondents said their online video spend has increased over the past 12 months, with display and TV being the two main sources from which the online video budget has been taken.
  • 58% of respondents said they achieve greater engagement and scale with online video, even though TV is still the “key awareness driver.”
  • More than 80% cited reach as well as audience and content targeting as the main factors when planning a branded video campaign.
  • 73% of respondents said better audience targeting is the key to increase online video spend in the future (67% picked better measurement as the key).
  • 64% of respondents were satisfied with the video services in today’s market (which isn’t terrible, but does signal room for improvement).

Here’s the infographic AOL is sharing to give you a more visually pleasing look at the findings.

This shift in budgets is natural as consumers become increasingly screen agnostic and advertisers try to meet them wherever they are watching video. But even if online video budgets are pulling from those reserved for TV and display, the important thing is to see how much money is actually being moved. Otherwise it’s just simple math.

What’s more, branded content is in many ways unique to online video — so while budgets may be shifting, we’d also like to see how much spend is devoted to creating branded content such as web series or longer videos and how much is earmarked for buying and sponsoring existing content.

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