Advertisers to Spend Average of $18M on Digital Video, Per IAB Research

NEW YORK—The old adage is to follow the money, and in 2019 the money is increasingly flowing toward digital video. The “Digital Content NewFronts: 2019 Video Ad Spend Report” by IAB Research shows that there is greater video marketing investments across digital platforms—like mobile and OTT.

Brands, on average, are expected to increase their digital video spending to $18 million in 2019, with $9.3 million allocated to original content. Average digital video advertising was at $12.1 million in 2017 and $14.2 million in 2018.

“Digital video is growing—not only are the dollar figures rising rapidly, but advertisers are eager to adopt new digital video formats as well,” said Anna Berger, executive vice president, industry initiatives, IAB.

NewFronts appear to be a key driver of this growth, according to IAB. The report indicated that 84% of advertisers that attended NewFronts were influenced on original digital video spending. Eight out of 10 advertisers agree that their attendance resulted in increased spending on original digital video content, and more than half said that NewFronts resulted in greater spending throughout the year.

Direct-to-Consumer brands are among the big fans of digital video spending. Of DTC brands with more than $1 million per year budget, 78% plan to increase their ad spend on digital video in the next 12 months, while they are expected to boost their investment by 50% from a year ago.

Additional findings include the growth of new digital ad formats, i.e. stories and shoppable ads, are expected to see a sizeable increase in 2019; 59% of ad buyers plan to increase their TV spend in the next 12 months, with half reporting increases in OTT; buyers expect that half of digital video budgets will be spent through programmatic buys; seven in 10 digital video advertisers use influencers in their digital video advertising; and more than eight in 10 advertisers agree that a unified multi-platform buying solution is important.

“The availability of, and demand for high-quality video content across screens—from OTT to mobile and everywhere in between—is breaking down traditional silos between TV and digital video,” said Eric John, deputy director, IAB Digital Video Center of Excellence. “This year’s report clearly points out that buyers are looking for more unified approaches to planning, executing and measuring video campaigns across platforms. The more the industry pivots to make good on the promise of ‘video everywhere,’ the more we can expect digital video budgets to increase.”

The full report is available here.