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Is Digital Video Advertising the Future of Marketing? We Have the Answer.

In the recent years, the phrase “cut the cord” has come to mean far more than its original anatomical meaning.

Today, If you Google “cut the cord,” your most popular results will be dominated by one of two things: the music video for the song “Cut the Cord” by Shinedown and news about more and more people dropping their cable TV subscriptions.

We’re going to talk about the latter (sorry, Shinedown fans).

People have been steadily dropping cable in favor of a la carte TV packages and streaming services for a number of years.

Some estimates say cable is consistently losing nearly half a million subscribers each quarter — so much so that TV’s main source of revenue, advertisers, are taking notice and finding ways to respond to the trend.

Screen Shot 2016-07-06 at 5.04.38 PM

In the wake of cable’s continued downturn, advertisers are following the users and moving online.

The numbers back this trend, too: a recent study from the Interactive Advertising Bureau (IAB) showed that as people continue to migrate away from cable, advertising money migrates away, too, shifting from traditional television platforms toward digital video advertising.

This move makes sense for a number of reasons.

First, the audiences for online streaming services continue to grow. Hulu, for example, has seen thirty percent growth from last year and currently serves an audience of over 10 million subscribers. That number doesn’t even include the people who watch Hulu’s free non-subscription service, which features even more ads than the paid service.

Additionally, more and more people are getting their news from sources other than television. While in 2010 over 50% of people watched the news on TV, nowadays more and more people are getting their news from various devices, namely computers, phones, and tablets.

As a result, advertisers are diverting budget money away from cable TV advertising toward various multi-platform advertising tactics, including everything from content sponsoring to targeted native advertising.

Digital video advertising, though, is by far the most popular new form of advertising, and many advertisers are even going as far as to increase their advertising budgets in order to specifically account for digital video.

The move toward digital video advertising shows no signs of slowing and it might even be a better way to get actual views from potential customers.

As online video performance and quality continues to improve in terms of resolution and speed, the medium is only growing more accessible across a wide range of platforms, devices, and audiences, and some users who are watching videos on these platforms might even prefer to see these digital video ads.

Currently, some platforms like ESPN are not showing ads for their online streaming platforms, and many customers have gone as far as to say that they would prefer commercials to a blank “Commercial Break” screen featuring bad elevator music.

Screen Shot 2016-07-06 at 5.04.48 PMStudies also show that more and more users are encountering digital video on mobile devices, where things like ad blockers are less prevalent and advertisers can get a quicker return on investment due to the steady growth of mobile-based online shopping.

Additionally, the ability to enhance the advertising experience through online interactive ads and social media means users can benefit from a more engaging and fulfilling advertising experience through digital video over traditional TV-based platforms.

Whether they know it or not, the statistics show that customers actually don’t mind advertisements, as long as they’re either engaging or unobtrusive.

And since it’s been pretty much confirmed that standard online ad banners don’t really work because they too closely resemble pop-ups from internet advertising of old, users can expect a huge uptake in digital video advertising in the near future, especially as more and more media gets consumed on devices and platforms that don’t fit the traditional cable model.

Instead of getting annoyed by the prospect of more annoying video ads playing before their favorite YouTube video, though, customers, consumers, and users can be excited about the future.

The numbers are showing that digital video is here to stay — a 114% growth in digital video advertising spending since 2014 as reported in the IAB’s study makes that abundantly clear — and people are doing some very exciting things in the realm of interactive video advertisements that might very well make future advertising not only an exciting art form but a joy for the user to behold.

For an example of what we’re talking about, check out the interactive video ad from Skittles below:

 

Whether it’s touch screen interaction or clickable advertisement customization, we’re entering an age of advertising where we will not only tolerate commercial breaks but may even come to enjoy them just as much as the programming itself. It’s a win-win for everyone, and the trend shows no signs of slowing anytime soon.

About the Author: Ellie Martin is Co-founder of Startup Change group. As writer and author, her works have been featured on Yahoo! , Wisebread, AOL, among others. She currently splits her time between her home office in New York and Israel.

  • John James
  • Patricia Newson

    Thanks for helping me illustrate this, copying and sharing! It’s amazing how many great fact are out there as more and more success stories (for big AND small businesses are shared publicly) and seeing how both Facebook (and Instagram, and soon Whatsapp) as well as YouTube (and soon Pinterest and even Linkedin) are actively promoting this, it makes perfect sense to invest in a video strategy.

    We’re big fans of combining fun content creation (take a bit more time, but can be fun) with apps/services like Animoto, cinemagram and Msqrd (bite sized content:) and using the new gen instant creation tools like Promo from Slide.ly for video ads and marketing videos and shaker and explainify for animations and template based stuff.

    overall slide.ly/Promo is our favorite service so far in terms of results and ease of use, and Animoto for our personal stuff

    but that’s just us, each businesses or digital marketer owes it to themselves or their clients to get their hands on a fav business video creation tool.

    Exciting stuff!

    • Thanks for sharing the resources, Patricia. I’m diving in to the world of video content as we speak, and am going to check out all the resources you listed here. Thanks!