TV Commercials Move Online

TV Commercials Move Online

JULY 19, 2007

The line between online advertising and offline advertising is blurring.

eMarketer estimates that this year US online video ad spending will reach $775 million, and grow from there.

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At 89%, 2007 will show the greatest year-over-year growth for US
online video advertising. Coming from such a small base, however, makes
this high rate relatively easy to attain. More important indicators
come over the next four years, as spending continues to rise at rates
of 39% or higher.


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Still, putting these high growth rates into perspective, video will
represent only 3.6% of the total online ad spend this year. Even by
2011, when video ads will be commonplace on the Web, less than 10% of
the annually escalating spend will be devoted to the format.

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"Looking over the numbers, it is not difficult to see how even a
small shift in TV ad spending will be a driving force in overall
Internet ad spending gains," says David Hallerman, eMarketer Senior
Analyst and the author of the new report, Video Advertising Online: Spending and Audience. "Video will be behind the wheel."

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Video’s high engagement factor, combined with the Internet’s
tracking and targeting capabilities, potentially offers brand
advertisers a highly accountable method to sway the hearts and minds of
their target audience. For Web publishers, video advertising represents
a new and potentially large revenue stream.

"Unfortunately, a third element in the equation — the audience
— is not entirely ready for TV-like advertising on the Internet," says
Mr. Hallerman.

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