Dive Brief:
- According to the Wall Street Journal, YouTube is the leading social media platform in terms of getting video ad dollars once meant for TV. However, it’s still having issues grabbing more than a small fraction of that spending.
- The main challenges for YouTube are overcoming pricing issues, institutional behavior on the part of ad agencies, and perceptions of content quality.
- Adam Shlachter, president of VM1 at ad buying agency Zenith Media, told the Journal, “Web-only properties are still making a case for a seat at that [TV budget] table versus sitting at the kids table. I don’t think it will change drastically this year.”
Dive Insight:
Even though TV as a single channel commands the majority of ad dollars, the trend line is clear. Per Magna Global TV spending will increase 0.5% this year. Online video advertising is expected to increase 28%, according to eMarketer, with multiple forecasts seeing digital ad spending overall passing TV by next year at the latest and leaving TV in its wake from that point forward.
This doesn’t mean marketers should pull out of TV, but it does mean online video ads are a serious alternative to the traditional way marketers reach audiences with video. And it also points to the value of second screen campaigns that leverage online video to augment and reinforce TV efforts.
Not surprisingly, traditional industry players don’t see the change as imminent.
Even though change is slowly occurring, the trend from TV to online video is one marketers should be watching closely. Given how digital has completely shaken the foundations of other similar industries, such as music, traditional media and agencies would be remiss to ignore the looming change.
