Half of the US Population Will Watch Online Video in 2008 [4/16/2008]

In spite of the fact that half the US population will watch online video in 2008, the ad dollars are not keeping pace, according to eMarketer's report, "Video Advertising Online: Spending and Audience.

Why is Online Video So Appealing to Internet Marketers

Online video is appealing to Internet marketers and e-retailers for five primary reasons: (i) it easily engages and retains the visitor for longer periods of time; and (ii) it’s easy to track sales; (iii) it’s simple to target tightly focused niches; (iv) it offers a relatively passive revenue stream for Web publishers; and (v) it has powerful branding capabilities.

Given this, it’s easy to see why in spite of the low ad spend when compared to viewership, Internet marketers and e-retailers are excited about online video.

Why Aren’t Video Ad Dollars Pouring In

If advertisers are sold on online video, why aren’t the ad dollars pouring in? There is no clear-cut answer but eMarketer’s report, Video Advertising Online: Spending and Audience, attempts to shed some light on the question.

This year, a projected 155.2 million people in the US will watch online video. But, as with every medium involving people, how they perceive is what helps to shape the format moving forward.

This leads to two reasons why the growth of online video advertising is expected to fall below expectations. The first reason is that advertisers have to figure out what the audience wants and will accept. One would figure that this medium will experience the same questions that confronted television advertisers during its introduction into the mainstream.

The second reason that online video advertising is expected to fall below expectations can be overcome with more ease. The problem is ad inventory, as in gathering enough of it to cohesively monetize the revenue streams seamlessly while giving advertisers what they want with some consistency.

In the aforementioned report, eMarketer explores such questions as: what is holding online video back, what types of content do viewers want, how long should ads be and more.

Exponential Growth Expected for Online Video Advertising in a Few Short Years

Once all of the kinks are worked out, Internet marketers foresee online video advertising as a very lucrative medium. Bearing this out, in 2007, online video ad spending rose 89% to $775 million. This was the largest year-over-year growth for the medium. Looking just a few years out, by 2011, experts predict the medium’s growth rate to rise near or above 40% every year. This means the industry is projected to reach $4.3 billion by then.

For more insight visit Online Video development

Back to Article Listing  |  Email to a Friend