Video ad spend is predicted to rise 16% year-over-year in 2024. Brands are interested due to deep penetration that CTV and digital video have with U.S. households. Streaming services and other publishers are stepping as much as bring more ad-supported options to consumers, together with higher ad experiences.
Dig deeper: IAB NewFronts rings in the age of digital video dominance
Here are three key reasons behind this growth in digital video and the numbers behind them.
(*3*)Ad-supported CTV is widely adopted and preferred by many
CTV is an accepted a part of many U.S. households. As of 2022, 93% of U.S. web users are reachable by CTV. Since then, streaming services have introduced more subscription options because the ecosystem continues to evolve. Ads have develop into an even bigger a part of that ecosystem, and they’re accepted by many viewers.
At IAB NewFronts, LG AdSolutions shared that 80 percent of CTV watchers said they like ad-subsidized subscriptions. These consumers understand the worth exchange — they pay less for entertainment and accept ads because the tradeoff. Sixty-nine percent said they like ad-supported CTV over other models.
LG also shared how smart TV watchers resolve what to look at. Here are the highest 5 ways they resolve:
- Recommendations from family and friends (44%)
- Homepage of streaming app (40%)
- TV home screen (39%)
- Social media ads (25%)
- TV commercials (23%)
The smart TV hub or the streaming service homepage is a spot where CTV viewers spend quite a lot of time. No wonder many services are integrating ads into these experiences. Users spend a mean of 11 minutes, and 38 seconds between turning on the TV and watching content, in keeping with LG.
Social media is a key channel (either from ads or recommendations from friends) for consumers to come to a decision what to look at, in addition to how you can make decisions on purchases.
CPG and retail are the biggest-spending and fastest-growing categories
CPG and retail make up the largest slices of digital video spend. And they’re growing. CPG brands alone are projected to spend $12.6 billion on digital video in 2024, in keeping with IAB’s “2024 Digital Ad Spend & Strategy Report.” That’s up 20% from 2023. And retail is growing even higher at 30% year-over-year, projected to succeed in $7.4 billion.
CPG and retail advertisers rely upon constructing awareness at the highest of the funnel, spending billions on digital promoting to tap into, which has penetrated the overwhelming majority of U.S. households.
But in fact, digital video isn’t a “spray and pray” channel, it’s measurable and addressable. One indication of CTV’s and digital video’s precision is the expansion seen in targeted B2B campaigns. B2B brands’ ad spend here is projected to climb 22% in 2024, exceeding $4 billion. To fill this need, LinkedIn has added CTV to its ad offering.
Dig deeper: How CTV can deliver market research for B2B marketers
Influencers and the role of social media
Marketers are expected to spend $35.09 billion globally on influencer marketing in 2024. 1 / 4 (26%) of marketers said they invested 40% or more of their marketing budget on influencers, in keeping with Statista.
CTV is a key channel for amplifying influencer campaigns. Influencer marketing platform Influential is proving this out with its Influential 360 campaign tool, which measures and manages cross-channel campaigns.
AT IAB NewFronts, CEO Ryan Detert unveiled a multi-channel campaign executed for QSR Whataburger that leveraged not only influencers on social but in addition CTV and digital out-of-home.
“The right influencer, who’s properly vetted, with the proper content and the proper trend can result in real-world results,” said Detert.
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