FMCGs overtake entertainment as biggest spenders in online video advertising, says Videology report

FMCG advertisers overtook entertainment as the biggest spenders in online video with impressions surging 66 per cent quarter on quarter, according to figures from addressable audience platform Videology.

The report, which marks the third in a series of Videology-led research that will be published exclusively on The Drum, is based on 553,197,168 video impressions in the UK during the first quarter of 2013 – up from the 465m impressions tracked in the previous quarter.

FMCG advertisers have increased their total impressions on the platform by 66 per cent compared to the previous quarter, coinciding with seasonal peaks in health and confectionary products in the run-up to Easter. Meanwhile their total share of video spend increased by six percentage points year on year.

The same sector is also showing a “growing confidence” in using more granular targeting outside of regular demographic targeting historically typical for TV and online video advertising, according to Videology’s senior engagement manager Kristian Claxton.

Total share of non-demographic audience advertising, which includes geographic, social, household data and behavioural audience targeting, surged 65 per cent year on year, accounting for a third of all FMCGs’ video ad targeting.

“FMCGs have really grasped the concept of end-to-end solutions [for video], so being able to take objectives, audiences and engagement and looping that back with ROI, not dissimilar to how they work and use data already for business objectives. When we talk about consumers we are referring to a whole wealth of attributes – social, age, gender, lifestyle – being able to refine and execute on those audiences is really attractive for FMCG companies,” said Claxton.

The growing confidence, particularly among FMCG brands, is partly due to the high brand engagement rates they see as a result of using more granular targeting across the Videology platform, according to Claxton.

“It’s not just about finding the right audiences but also delivering them the right ad at the right time that is delivering serious engagement rates,” he said.

Videology measures cost per completed view on video ads, with those that watch videos all the way through classed as highly engaged, well-targeted audiences.

One of its FMCG clients saw a cost per completed view of 3p for all its campaigns, compared to the market average of 8p, according to Claxton.

“The 3p cost per completed view they generated is down to the fact they are really using the various different types and attributes of targeting available. The right people were viewing through therefore engaging with the content. For detail and complexity of targeting to get down to 3p is pretty significant,” he added.

Although the majority of video impressions (93 per cent) in the report were across online video, mobile video advertising accounted for five per cent, taking the total to 11,063,943 impressions. Connected TVs saw a 2 per cent share of impressions at 27,659,858 impressions during the first quarter – up a percentage point from the previous quarter. However, Claxton said it is "vital" brands approach mobile as part of the overall media mix, rather than viewed in isolation.

Meanwhile the number of impressions that used advanced targeting methods, classed as behavioural, geographic and day-part targeting, saw a marginal rise from 20.3 per cent the previous quarter, to 21 per cent in Q1. Demographic targeting still takes the majority it spend, accounting for 63 per cent of total impressions in the first quarter.

Of the advanced targeting share, the majority (82 per cent) of impressions were geo-targeted, 11 per cent behavioural and 3 per cent on day-part targeting.

Claxton said day part targeting remains an “untapped” area which has huge potential, but is expecting this to grow, bolstered by the continuing proliferation of mobile devices and multi-screen consumer consumption habits.

Around 90 per cent of Videology's budget is currently taken from TV spend, but this will change as it continues to diversify its product range, which has included the launch of a display product.

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