Digital Video Ad Spending to Top $10 Billion in 2015

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Two thirds of brands and agencies will shift budget away from TV to fund the 43% YOY increase.

TV will pay the price form more video ads.
TV will pay the price form more video ads.

More than 300 brand marketers and agency executives polled by the Interactive Advertising Bureau this month said they would increase spending on digital video to $10.3 billion this year, a 43% increase over 2014. Increasing ad budgets and a high level of optimism about the prospects of the medium will fuel the trend.

Budget diverted from broadcast and cable TV will ultimately fund the increase. Only 33% of respondents said they expected to increase spending on TVs this year versus 68% who said they'd devote more budget to digital video and 58% who'd invest more in mobile video. In all, 67% said they'd be shifting funds from TV into video buys.

Another sign of vitality for the channel is an upward trend in ad placement within original video content. Advertisers devoted 34% of their video budgets to original content in 2013, 36% in 2014, and expect to ratchet up to 40% this year. More than half of both agency execs and marketers said they'd pull funds from cable TV to fund increased placements within original videos.

Two thirds of respondents agreed that original video programming would be as important to their efforts as TV programming within five years. The time frame of video's ultimate arrival may depend on measurability. Three quarters of those polled said they'd be more likely to spend more on video ads if research existed to prove they generated sales on par with TV spots.

“This study demonstrates unequivocally that digital video is a fierce competitor for advertising dollars,” said Sherrill Mane, SVP of research, analytics, and measurement for IAB.

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