Resource Constraints Holding Back Further Investments in Video Ads

December 11, 2017

Almost 8 in 10 brand marketers expect to increase their focus on video advertising next year, and more than 7 in 10 believe it will be easier to adopt digital video as a channel in 2018 and beyond, per an Innovid report [download page]. However budgets present an issue, according to respondents.

Indeed, three-quarters of respondents reported that cost/budget is inhibiting their ability to invest more in video advertising. That aligns with recent research from Advertiser Perceptions, in which advertising executives pointed to resource challenges as their biggest roadblocks on the job.

However, it seems that video advertising budgets will be on the rise – particularly mobile video. PwC forecasts that spending on mobile video will grow by a compound annual rate of more than 30% through 2021.

For the time being, respondents to Innovid’s survey dedicate roughly one-quarter of their digital video ad spending to mobile, with more going to Facebook (39%) and YouTube (27%). The emphasis on Facebook over YouTube is supported by separate survey results indicating that social platforms are now the preferred distribution platform for digital video campaigns.

Are Video Ads Proving Effective?

While cost and budget together clearly represent the top limitation to increase investments in video advertising, it’s worth noting that almost half (48%) of the survey’s respondents pointed to a need for video ads to be proven effective.

In fact, the need to prove effectiveness is a bigger constraint right now than the topical concern over brand safety and the risk of fraud.

Separately, asked to rate the success of their video marketing efforts to-date on a 10-point scale, relatively few (28%) gave a top-3 box rating (8-10). Instead, the majority were more neutral, with a rating of 5-7 on the 10-point scale.

Other Highlights

  • Brand marketers care most about digital KPIs (89%) such as click-through rate and engagement when measuring the success of an online ad campaign, with transaction KPIs (65%) next.
  • 8 in 10 respondents believe that 1st party data can be used to segment and personalize digital advertising creative today. While fewer agree, a majority believe that TV ads can be interactive (56%) and that video advertising can be delivered based on the temperature outside (54%).

About the Data: The results are based on a survey of 140 marketing executives from leading brands. The CPG industry (26%) was the most heavily represented.

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