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Publishers see 20% boost in revenue from online video

Online publishers have pocketed a 20 per cent leap in revenue generated through online video, according to the Association of Online Publishers (AOP) and Deloitte’s Q4 Digital Publishers Revenue Index Report.

This is a significant increase from the previous quarter which only saw a 3.4 per cent growth in online video.

For the first time, the AOP has also recorded members’ smartphone and tablet revenues over a full year. It found that smartphone and tablet revenues increased by 56 per cent over the past 12 months. Mobile alone was up 78 per cent.

Overall, total annual digital revenue has almost doubled since the report launched in 2008 but desktop display advertising remains the most significant contributor to digital advertising revenues, accounting for 55 per cent of revenues generated.

AOP managing director Tim Cain said the sustained growth over the past seven years “continues to demonstrate how publishers are adapting to a rapidly changing online environment.”

“A key opportunity for UK publishers in 2015 is native advertising, which has strong resonance due to the trust of consumers in premium content media brands,” he added.

The upswing in online video revenues chimes with the findings from ZenithOptimedia's annual media study, which credited the channel for driving global ad spend to digital last year and predicts bigger gains over the next few years as advertisers pull budgets from TV.

Howard Davies, Deloitte media partner said of the UK study: “Publishers continue to embrace online video as a platform and they are being rewarded with strong growth figures. Research suggests it’s proven to be effective in shifting consumer perception and brands are responding to that.”

However, revenue generated from classified ads was down 10 per cent year-on-year. The AOP suggested that specialist sites are increasingly preferred for these services, citing online dating as an example.

The AOP also published its Sentiment Report, which looks at members’ confidence in the financial prospects in both their own companies and the industry.

Overall, it was positive with AOP board members expecting to see growth in digital advertising spend in 2015 forecasting growth at 11.5 per cent up from 10.5 per cent in Q3.

Some AOP Board Members reported that native advertising is gathering pace and will make an important contribution to their performance in 2015.

For more on the changing business models of publishers check out The Drum’s Media Slap.

Jennifer Faull

The Drum senior reporter Jen Faull provides news and insight on the latest developments in retail and FMCG.

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