The Online Video Explosion Is Driving Up Marketing Costs. Advertisers are spending more money than ever on video. Although video may be the most effective marketing asset today, there’s another fact about the video explosion that’s less worthy of celebration: Video is raising marketing costs. Video Needs To Be Multichannel – And Each Channel Has A Cost Today, there is no such thing as a single-channel strategy. With multichannel campaigns now necessary, video has become the most popular way to drive campaign engagement across channels. This is why, in 2017, 65% of all US video ad spend will be transacted programmatically. As an advertising platform, Snapchat has forced brands and marketers to reorient how they think about aspect ratios for video ads. Vertical video is now popular and forcing the industry to “rethink everything.” This degree of new thinking, ideation and production per platform costs money. As video has become the go-to media for advertisers, legal costs will only continue to grow. But marketers need to optimize ROI, accounting for the challenges that accompany the rise in video ads that are driving up costs.
“On
TV And Video” is a column exploring opportunities and
challenges in programmatic TV and video.
Today’s column is written by Ian Wheal, global
strategy director at Adstream.
Advertisers are spending more money than ever on video. Last
year, video ad spend grew by more than 85% [PDF].
Video ads consistently outperform standard banner units, and
studies have shown engagement on mobile video to be
five times higher than with standard banners.
Although video may be the most effective marketing asset today,
there’s another fact about the video explosion that’s less worthy
of celebration: Video is raising marketing costs.
Video Creative Is Expensive, Especially When It’s
Wasted
As video becomes table stakes for brands and marketers, the cost
has skyrocketed. Creating high-quality, engaging video content is
inherently expensive. Prone to reshoots, rewrites and disagreements
over post-production strategy, original video ads are notoriously
challenging to produce. This is why setup costs for domestically
produced video content could
reach new highs by the end of the year.
Most marketers are fine with the cost, given the potential ROI
and brand lift with consumers. But, remarkably, many video ads –
despite the cost of production – are never run.
One-third of marketing assets – including video – go unused,
according to IDC. This is a frustrating workflow problem that stems
from the explosion in video content that may be lost, forgotten or
abandoned.
Video Needs To Be Multichannel – And Each Channel Has A
Cost
Today, there is no such thing as a single-channel strategy.
In the US alone, adult consumers spend more than five hours
across digital screens and more than four hours across traditional
linear television.
With…
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