The State of The Video Advertising Industry Q3 2009

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Tod Sacerdoti from Brightroll recently dropped some stats pertaining to how they see the market shaping up and performing through the third quarter of the year. Some were quite interesting so I thought I would share them with you.

While these statistics mostly apply to Brightroll I imagine that some of them are trends that are industry wide. For example, they saw continued drops in ad pricing for pre-roll not surprising if you take into account the current economic slowdown. Until things turn around and show some serious positive growth I’m guess this is going to be the norm. But if you look at it another way, the lower pricing could allow advertisers with smaller budgets to get into the arena putting  far money and inventory into the collective system meaning that more websites could publish pre-roll ads on their videos or video ads on their pages.

What was once an expensive way to advertise is now a cost-effective and proven way to advertise online. With cost-per-click and per-thousand-impressions video ads are now being treated more like standard banner ads and that pricing will be more enticing to the advertisers I’m sure.

According to Brightroll here are the pricing trends they saw.

  • Avg. Pre-roll CPM: Q309 vs. Q308 – down 37.3%
  • Avg. Pre-roll CPM: Q309 vs. Q209 – down 4.5%

They also saw an influx of campaigns for the quarter which has to translate into far more video ads all around and not just at Brightroll. While they might have seen a higher growth rate (46% over Q2) than the industry average, it should still translate into some growth at other video ad networks as well even as much as 30% one might imagine. They also saw an increase in active advertisers (31%) which can probably be related to those lower prices that I just mentioned earlier. Tod believes that the industry could see 50% growth across advertisers, campaigns and RFP for this year and 2010. That’s a pretty hefty chunk of growth and probably outstrips other forms of advertising online by a fair margin.

Tod’s quarterly report also stated that consumer product goods advertisers are of high importance and are the largest category of ads over at Brightroll. It looks like video ads are having an impact on retail sales if that’s the case. As more and more consumer goods ads show up tracking is in place to see just how much of an impact they are having at the point-of-sale. From the looks of things they are becoming highly valuable based on the amount of growth in the number of ads and advertisers.

From an industry perspective we should be extremely happy, not only for the success that Brightroll is seeing, but for what that means for us all. If we’re going to see 50% growth this year and next that is going to leave a lot of inventory that is going to need placement. That means more and more possibilities for web publishers to display ads. It means more videos will need to be produced bringing work to the creative people and agencies  and more available inventory for the ad networks.

It also means that the industry appears to be highly valuable to advertisers who are finally ready to call ACTION! on some video advertising and marketing online. With big names moving into video ads all the time, it’s no wonder that they’re bringing a lot of others with them, is it?


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