Back in April, IAB forecast digital video to surpass linear TV in US ad spend this year. Now the trade organisation has released part two of its ‘2024 Digital Video Ad Spend & Strategy Report’, to examine the motivations of buyers who now consider social video (70 percent) and CTV (69 percent) a “must buy” on their media plans, including where those budgets are coming from.
Perhaps unsurprisingly, 40 percent of those CTV advertisers are reallocating budgets from linear TV. This is tipping the scales to give digital video a 52 percent share of ad spend this year, compared with last year when linear TV held 52 percent market share.
But it is not just linear TV budgets reallocating to CTV; advertisers are shifting spend from non-video digital ads (40 percent), traditional ads (39 percent) and social media (34 percent). And almost one-third (31 percent) of the buyers said CTV spend was also coming from overall expansion of advertising budgets (31 percent), suggesting CTV could be driving new forms of investment.
Meanwhile, 70 percent of advertisers cited ad quality as one of the main criteria for choosing where to spend on digital video channels, which helps explain this shift towards CTV channels. On the other hand, 66 percent said measurement was a deciding factor – and one that often frustrates advertisers when it comes to CTV. This does however point towards the investment in social media, whose walled gardens tend to provide accessible measurement for video advertisers.
Buy-side shifts
The type of video content receiving investment is also expanding, according to IAB. While short-form (69 percent) remains the most popular video format among advertisers, other formats are seeing faster growth, with vertical (68 percent), branded/sponsored (67 percent) and long-form (57 percent) video all gaining popularity this year.
As more buyers advertise against every major type of digital video content, buying methods are also converging. IAB estimates that three-quarters of CTV transactions now occur programmatically, and CTV buyers are increasingly planning to use programmatic channels, citing easier campaign optimisation (34 percent), better ROI/ROAS (30 percent), and ease of achieving scale (28 percent).
Alternative currencies are also gaining traction, according to the report, with 28 percent of TV/video buyers now transacting on alternative currencies. Advertisers cited multi-screen attribution (45 percent) and real-time reporting (43 percent) as the main reasons for using multiple currencies, seeking to update their buying methods to meet the changing nature of video viewing.
As one marketer explained: “Real-time audience measurement metrics that capture cross-platform viewership, engagement, and demographic data are needed to adapt to evolving viewing habits and technologies.”
