Spending on digital video advertising (DVA) is poised to grow 25% in the next year, and the tactic is the “new darling” of many savvy marketers, according to a new study conducted by research firm Advertising Perceptions for Toronto-based Casale Media.
The online survey of 150 managers and media planners at advertisers and agencies found that 80% of online video is used for brand building purposes, while 60% use it to communicate more detailed product information and 50% use it to increase traffic to a retail location or website.
The study found that video is expected to account for 23.8% of total online ad budgets, up from 19.1% one year ago.
However, research also indicated that there are several barriers to the widespread adoption of online video: 38% of people surveyed found planning difficult, while 40% found the creative phase difficult and 35% found the execution phase difficult.
In addition, close to 40% of media buyers believe it is too difficult to measure the return-on-investment for digital video, and 38% feel there is not enough ROI attached to the tactic to justify increasing the spend.
Other stated reasons hindering greater use of DVA include an inability to precisely target the exact audience they want to reach (26%), a lack of original ads for the video medium (24%) and difficulty in obtaining the necessary reach (23%).
However, research also indicated that 31% of respondents would book online video all the time if such barriers were removed.
The report concluded that digital advertising–and video in particular–feels like the “wild, wild west” to the majority of advertisers and planners, and while some are willing to “muddle through” the trials, many are increasingly relying on third-party experts.
“When these barriers to entry are removed, we will see a significant spike in digital video advertising revenue, and greater interactivity with other media–specifically television,” the report said.
The study called Nike’s decision to debut its digital video campaign “The Chosen” on Facebook three days prior to its television premiere a “landmark” media decision that will be emulated by other advertisers. The full report can be downloaded here.
