What: According to Zenith’s Online Video Forecast, viewers will spend an average of 47.4 minutes a day watching videos online this year, up from 39.6 minutes in 2016. This is partly driven by a 35% increase in viewing on mobile devices, for a total of 28.8 minutes a day. We spoke to industry experts from The Story Room, Walton Isaacson, Havas Media, and the community about how they are tackling video.
Why It Matters: Zenith predicts that by 2019, 72% of all online viewing will occur on mobile devices. In contrast, viewing on desktop PCs, laptops, and smart TVs will only increase by 2% to 18.6 minutes a day, and then shrink by 1% in 2018 and 2% in 2019.
What does this mean for how brand marketers and media buyers will be distributing their ad spend? And how is the United States leading the global marketing industry in shifting budgets from fixed devices and television to mobile?
The United States Accounts for 44% of Global Mobile Expenditure
U.S. ad spend has reacted more strongly to this trend than other global markets: The U.S. accounts for 44% of all global mobile expenditure this year, while its share of overall global ad market is just 35%.
To those in the industry, this isn’t such a surprise. Jacqueline Hernandez, Digital and Social Media Strategist at the community, said, “The U.S. has had a tendency to be a trendsetter in social and digital behaviors and, as a result, has also led the charge in how we approach those behaviors as marketers.”
Hernandez attributed this greatly to the large numbers of younger users pushing US mobile adoption: “While all age groups are watching more online video, the younger the demographic, the greater the propensity for online video consumption.” She added that “generation Z, which will be a key adult target in 5-10 years, already shows a significant preference for watching longer format video (even feature length films) on handheld devices.”
Diego Prusky, Co-Founder and Chief Strategist of digital marketing agency The Story Room agreed, noting that the United States is driving US mobile video growth because US consumers were early smartphone and video adopters, and also because “smartphone penetration in the US is now over 80% and the millennial plus generation Z digital natives account for over 40% of the population.”
Albert Thompson, Digital Strategist at Walton Isaacson, also reminded us that American content is not heavily censored: “You must remember, content is less censored here than in other countries so consumption is endless with very little constraints and often, as a result, there is an over-abundance of it.”
Fixed Devices Vs. Mobile: Which Is More Effective?
While trends indicate that mobile video is the future, the study argued that fixed devices are still “more effective at conveying brand messages, and so command a price premium from advertisers” due to fact that fixed devices are displayed on larger screens, in less distracting environments, than those viewed on mobile devices. Not everyone agrees here.
Jessica Richards, EVP, Managing Director of Socialyse at Havas Media argued that mobile has its own advantages: “The native experience in some mobile apps/platforms require a different delivery mechanism but can be just as effective.”
The sheer number of variables involved in measuring the effectiveness of a mobile ad means that standardization will be important, Richards argued, in order to determine “the value of a view with so many disparate factors to manage for: decrease in attention, distinct mechanisms for content delivery (i.e. a Snap, Messenger, Roku), and differing measurement solutions across platforms.” She pointed to the challenges associated with getting a “true read on performance” as a major roadblock, and admitted that in the end, “it is difficult to state that one channel/size truly delivers the best performance across all audiences, especially younger demographics.”
Prusky of The Story Room also noted the ways that younger generations’ habits and preferences are forcing marketers to adjust their strategies. “Younger generations will much rather interact with a digital video or an influencer video than watch a 30-second commercial,” Prusky explained.
Prusky highlighted the importance of user experience, and delivering the right content to customers on the devices they are using: “When our foodie / Food Network consumer is on the subway checking Instagram, we need to have a quick Food Hack video or a review, and when they are leaning back on their sofa checking Facebook we need to have a hands and pans video or an influencer video that will entertain them and drive them to try our recipes.”
Richards of Havas Media agreed that the device is secondary to adjusting content to consumer needs. “Most smart advertisers have started to evolve their marketing approach to more naturally align to how the consumer behaves.” Brand marketers must think like their customers and anticipate not only what their needs are and when those needs are most urgent, but also the devices that consumers will use to resolve them.
“This means brands/agencies are beginning to take a stance that video content should be delivered agnostic of device/channel,” Richards elaborated, “using data to segment appropriate audiences, which leads to an increase video distribution in digital environments, primarily mobile.”
Regardless of whether mobile is less effective than fixed video, it is important to recognize that consumers interact with mobile differently than they do with a fixed device. “Remember, video displayed on mobile devices are often consumed while in transit, minor stopping points again while in transit, or while multi-tasking,” Thompson of Walton Isaacson explained. “Video content via mobile devices has to take into account the ‘mobility’ of the consumer.”
Global Budgets Set to Shift Toward Video
If Zenith’s predictions are any indication, the industry is starting to embrace the power of video. According to the study, fixed video ad spend is estimated to reach $15.2 billion this year, while mobile ad spend is still only at $12 billion. But next year, mobile video ad spend will surpass fixed video ad spend at $18 billion compared to $15 billion.
Andy Amendola, Senior Director of Digital Strategy and Media at the community, argued that “mobile is the first screen now” because “the mobile device is the distraction so if can reach your target there you win.” Aside from the fact that many of us spend the majority of our days looking at our phones is the fact that the phone adds an added element of personalization because you speak directly to an individual through the screen.
Amendola added: “There is nothing more personal than video on your phone that’s done in the right way: original, customized and relevant creative made for mobile viewing in a vertical style.”
Limited by Time, Lack of Creative Development, but Rich Source of Marketing Data
Despite its popularity among consumers, mobile video is still an imperfect tool for marketers in many ways. Richards of Havas Media noted that “limitations on creative/content development (time to create, number of pieces available, etc.) lead to a lot of brands and advertisers still using a limited or single piece of content or creative across multiple platforms, without variation in message, testing of content (length, animation, imagery), or pure understanding of consumer interest on platform.” This leads to the “oxymoron” that native ads really aren’t so native at all. “Additionally,” Richards continued, “while measurement is improving dramatically, it is not 100% and there are still a lot of platforms that remain ‘walled gardens’ which inhibits a truly agnostic video strategy.”
But others embrace the alternatives that video presents. Prusky from The Story Room said that digital video was “the highest priority for our clients due to the consumption and possibilities across the digital ecosystem.” He mentioned that The Story Room created a mix of pre-produced, on-site, 360, live and real time video that is distributed through Facebook, Instagram, Twitter, YouTube, website, and an app. “These add up to millions of video views, but also to valuable marketing data that allows us to segment consumers and better understand who they are and what they are interested in,” Richards said in defense of the new marketing format.
Despite the roadblocks, Richards, at least, is optimistic that the industry will work out the kinks: “Video will continue to being a growing market because technology, brands, advertisers and platforms are investing heavily in solving the core challenges in media delivery, content and measurement.”