The majority of online video spend in the last 12 months is coming from budgets previously reserved for TV advertising according to Be On. Although TV is considered a key awareness driver, 78 per cent of respondents in Europe and 58 per cent globally said they could achieve greater engagement and scale with online video.
However, another report by PwC gives a much more modest growth trajectory for online video cannibalisation of TV ad spend. Here'sPaidContent's verdict on their findings:
In the future of television land, everyone from AOL to the Wall Street Journal will be making awesome online shows and sponsors will ply them with ad budgets once reserved for TV. And why not? After all, online audiences are growing fast and might provide much better marketing opportunities.There's just one problem – it won't happen anytime soon.According to consulting firm PwC's annual media report, online video will increase from $2.3 billion in 2012 to $5.9 billion by 2017. The figure represents 9% of future online ad spending, but this is still a small amount compared to TV ads – which PwC predicts will pull in $81.6 billion, or 37% of all ad dollars in 2017 (the figure includes ads "around broadcasters' TV content", so adjust accordingly.)
However, PWC does concede that globally, digital media will account for 37% of advertising revenues by 2017, up from 26% in 2012 which is a clear shift. A lot of that is likely to also be new money and not cannibalizing from TV sources.
