Serious buzz about multichannel video advertising

Tuesday, April, 16 2013

Internet ad growth remains red-hot

By: Stewart Schley Tuesday, April, 16 2013

The latest Internet Advertising Revenue report is out from IAB today, showing online video advertising placements generated $2.3 billion of revenue to U.S. online publishers and ad sellers last year. That’s up 29% from 2011, and it underscores (once again) why cable advertising organizations are rushing to integrate online options into their product mixes.

Here are other highlights from the report prepared by PriceWaterhouseCoopers U.S.:

The category is surging . Total Internet advertising revenues reached $36.6 billion in 2012, a 15% increase over the previous record of $31.7 billion in 2011. That compares to a relatively languid U.S. advertising market overall, with indicating total spending grew by just 3% to $140 billion.

Mobile is growing fastest . For the second year in a row, mobile achieved triple-digit year-over-year growth, with ad revenues rising 111 percent to $3.4 billion. IAB says mobile accounted for 9 percent of total Internet ad revenue in 2012.

Search remains the king . Search revenues in 2012 hit $16.9 billion, accounting for 46 percent of 2012 revenues, up 14.5% from $14.8 billion in 2011.

Banners are alive and well . Display revenues – old-school banners and static ads – produced $12 billion or 33% of 2012 revenues, up almost 9% from $11 billion in 2011. Note that display spending is 5x the amount spent on digital video.

Retailers spend the most money . IAB says retail advertisers accounted for 20% of total Internet ad spend in 2012, followed by financial services at 13%.

What it means: Ad spend, as always, is following consumers. With total Internet usage rising and mobile in particular becoming the primary screen for Internet access (see this Accenture study ), cable ad industry participants need to identify ways to integrate online media into their offerings.

Most companies have reasonably robust online/multi-screen offerings now, with cable customer portals representing an early and obvious landing place for online display and/or video advertising. Time Warner Cable Media has gone a step beyond by acting as an online advertising aggregation and ad placement specialist for third-party websites. It’s the mobile dimension, though, where cable companies could use more presence. Although recent licensing extensions for high-profile cable network groups like ABC-Disney, Viacom and others allow cable distributors to insert advertising within network feeds that end up on smartphones, tablets and PCs, few if any cable companies have active programs in place to align local advertisements with these “TV Everywhere” extensions. I think that’s an omission, and the sooner cable advertising groups can launch mobile-video insertion programs, the sooner they can play a part in the fastest-growing component of the online advertising world.

Related:

Cable could top $1 billion in online local ads (March 22, 2013)

NCC puts spotlight on cable’s web portals (Jan. 22, 2013)



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