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.