Advertisers spent a record £14m more on video ads than banner ads for the first time this year, as video advertising grew by 46% to become the fastest-growing ad format in the industry, according to the latest Digital Adspend report by the Internet Advertising Bureau (IAB) UK and PwC.
In the first half of 2017, advertisers spent £699m on video ads – a 46% year-on-year rise – whilst spend on banner ads increased by just under 2% to £685m.
Video is the fastest-growing ad format and now accounts for 35% of all spend going on display advertising.
The figures show that advertisers are chasing the way that consumers are spending their time online, with Zenith's Online Video Forecasts 2017 predicting Brits will watch 20.3 minutes of online video this year, nearly double the amount from last year. This number rises to as much as one hour a day consuming online video according to eMarketer predictions.
YouGov data claims the time people spend watching short video clips has almost trebled over the last three years (Sept 2014 to Sept 2017): from 51 minutes to 2 hrs 21 minutes per week.
The IAB’s chief executive Jon Mew said: “The time people spend watching online video has grown tremendously over the last few years, so it’s little wonder that video is now the fastest-growing ad format as advertisers look to tap into the changing way people consume content.”
Within video advertising, spend on outstream/social in-feed nearly doubled and is now the most popular format, accounting for 52% of video spend (£363m), overtaking pre-and post-roll ads which account for 44% (£309m).
Dave Counsell, digital trading director, the7stars, said: “There’s no doubt that video is digital’s most important and powerful format. Growth in online consumption, improvements in measurement, quality of placements, targeting and creativity are now available alongside its unrivalled effectiveness. It’s an extremely exciting time to witness the strong results video is providing for advertisers.”
Display advertising as a whole grew 18% to £2 billion, whilst search grew 15% to £2.8 billion and classifieds remained flat at £692m. Thus, overall digital ad spend grew 13.8% to £5.56bn in the first half of 2017.
With half of UK internet time now being spent on smartphones, mobile’s share of digital ad spend has risen from 35% to 43%, or £2.37 billion. Mobile’s year-on-year growth was 38% and now accounts for 57% of all display ad spend, 70% of video spend and 83% of social media spend.
Ad spend on social media sites grew 42% to £1.05 billion, accounting for over half (53%) of the display ad market.