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Online video advertising: is it soaring or shuffling?

Art direc­tors and account man­agers from online adver­tis­ing agen­cies have some­thing of a conun­drum to con­tend with: is online video adver­tis­ing now siphon­ing adver­tis­ers’ bud­gets away from TV and dis­play, or not?

Up, down, flat or what?

It would seem that the answer depends on what you read. At the recent VideoNuze Video Adver­tis­ing Sum­mit in the Big Apple last week, lead­ing indus­try exec­u­tives seemed skep­ti­cal about any big switch to online video adver­tis­ing.  GroupM’s Direc­tor, Michael Bologna, believes that dol­lars aren’t mov­ing to online video espe­cial­ly vig­or­ous­ly. He said:

“TV bud­gets are flat. It’s hard to shift bud­gets when you pay more for less. Clients are say­ing, ‘We don’t have any more mon­ey, and every­thing is expen­sive.’ They’re not like­ly to increase their bud­gets by 75 percent.”

Dig­i­tas’ SVP, Adam Schlachter, agreed, pre­dict­ing that Web video will see spend­ing shift on a grad­ual, incre­men­tal basis. Brands are increas­ing­ly “chan­nel agnos­tic”, he con­ced­ed, but many retail clients see their sales rise when they adver­tise on TV, a point he said was “hard to argue with.”

Bologna went on to add, “There won’t be major shifts. I just don’t think we’ll see clients cut 30 per­cent of their TV bud­gets for Web video.”

An account manager’s headache

But here’s where the headache for art direc­tors and account man­agers begins: a recent glob­al study by AOL’s new glob­al brand­ed con­tent busi­ness Be On sug­gests that bud­gets are indeed mov­ing from dis­play and TV adver­tis­ing to online video.

xOver 770 ad agen­cies and brand and media experts were polled in the study — and 78 per cent said that online video adver­tis­ing pro­vid­ed bet­ter engage­ment and scale opportunities.73 per cent said that, over the last 12 months, they’d increased their online video spend by tak­ing from bud­gets pre­vi­ous­ly allo­cat­ed to TV and dis­play. The same num­ber said that they were attract­ed to online video mar­ket­ing because of its bet­ter audi­ence targeting.

Com­ment­ing on the study, René Recht­man, SVP at AOL Net­works Inter­na­tion­al, said that brand­ed con­tent was now a key part of glob­al adver­tis­ing strate­gies. He added:

“We know that con­tent dri­ves engage­ment and con­ver­sa­tion online and, more than ever, we are see­ing that brands want to tell their sto­ry through content.”

Maybe our poor art direc­tor just needs to take an aspirin and stay creative.