TELEVISION REMAINS A VITAL AWARENESS CHANNEL FOR BRANDS SEEKING MASS REACH, WHICH ONLINE VIDEO COMPLEMENTS BY PROVIDING MORE PERSONAL CONNECTIONS
Television is currently the largest advertising medium overall, attracting 36% of total spend in 2016. But internet advertising is rising rapidly, and will overtake television in 2017, when the internet will account for 37% of advertising expenditure and television will account for 35%. By 2019 we forecast television’s share of total advertising to fall back to 33%, its lowest share since 1990.
However, one of the main reasons for television’s loss of share is the rapid growth of paid search, which is essentially a direct response channel (together with classified), while television is the pre-eminent brand awareness channel. Television does not compete directly against search, and indeed the two can complement each other, for example by running paid search activity to take advantage of the increase in searches driven by a television campaign. Taking internet classified and search out of the picture, television will remain the principal display medium for many years to come. We estimate television accounted for 44.0% of display expenditure in 2016, and will attract 42.3% in 2019.
If we consider audiovisual advertising as a whole – television plus online video – we see that it is in fact gaining share of display advertising. Television offers unparalleled capacity to build reach, while online video offers pinpoint targeting and the potential for personalisation of marketing messages. Both are powerful tools for establishing brand awareness and associations.
Online video advertising is growing at 18% a year, and by 2019 it will total US$35.4bn across the world, fractionally ahead of the amount spent on radio advertising (US$35.0bn). Online video is benefiting from the spread of mobile devices, as well as the development of high-speed mobile data connections and improvements in handset displays. It is becoming common for brands to use online video as a complement to television, but for most it does not make sense to use it as a substitute.
We estimate that audiovisual advertising accounted for 49.1% of display advertising in 2016, up from 43.8% in 2010, and expect its share to reach 49.9% in 2019.
Read more detail in the second edition of Global Intelligence, which you can download here.
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