Warc, 14 August 2014
LONDON: Online display advertising in Western Europe is set
to grow at a compound annual growth rate of 10.3% over the next five years,
according to a new report.
Forrester Research's Online Display Advertising Forecast
predicts that spending on this format will grow three times faster than total
advertising between now and 2019, by when it will account for 12% of all
advertising expenditure in the region.
This development is being helped by underlying factors such
as the growth in the online population and increasing amount of time spent
online, as well as the adoption of new formats, including video and rich media.
Forrester also noted the importance of mobile devices, saying that "the
growth of the online display advertising market would be negligible if
smartphones and tablets were excluded".
Analyst Michel O'Grady enlarged on these themes, pointing
out that more than 100 hours of video is uploaded to YouTube every minute and
that Google has had to create ways to curate this volume of content. He also
cited studies showing UK click- through rates for rich media were more than
double those for standard banner ads.
A recent survey by US adtech company Celtra found even
higher click-through rates for rich media on mobile – nine times greater –
while video play rates were 8.5 times higher for rich media.
And Forrester expects an increasing proportion of video and
rich media ads to be viewed on mobile devices – 48% of all online display ads
compared to 19% today.
This shift was highlighted by Victor Milligan, CMO of
Nexage, a mobile advertising exchange, who in June told Warc: "There is a
major creative mix shift underway in mobile advertising, as high-value rich
media, video, and native ad formats take more and more share of the
market." He expected these would be the majority ad formats sold by 2015.
O'Grady suggested that firms using online display ads would
need to consider how to increase trust in online advertising, from the
perspective of consumers, publishers and advertisers, in order to help it
compete with TV advertising.
Data sourced from Forrester Research; additional content by
Warc staff
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