In-App Mobile Video Ads Drive Display Dollars

COMMENTARY

• by Gavin O'Malley , Staff Writer @mp_gavin, 11 hours ago

Over the next five years, count on in-app mobile video ads to increasingly drive display dollars.

That’s one big takeaway from a fresh Forrester Research forecast.

From 2018 to 2023, video will account for 93% of incremental display ad dollars -- and within video, mobile will be the primary driver.

To be precise, mobile will account for 72% of incremental online video ad dollars, and its share of the online video ad market will grow from 50% to 59%, during the period.

The growth of in-app mobile video ads is being driven by two key trends in consumer technology, according to Brandon Verblow, associate forecast analyst at Forrester.

“Given the high share of mobile time spent in apps and the growth in online video consumption, in-app mobile video ads are a natural driver of online display ad spending,” says Verblow.

Yet the strength of in-app ads isn’t likely to overshadow marketers’ love of banner ads on the mobile web, Verblow noted. That’s thanks to the greater reach they offer, he said.

In-app or otherwise, mobile is increasingly driving ad spending, Verblow says.

Indeed, the share of consumers streaming ad-supported content on mobile gadgets has been trending upward over the past three years, while PC viewership is trending downward, Forrester finds.

Additionally, long-form content’s expanding share of mobile viewing is boosting higher ad rates.

Long-form content viewing on smartphones as a share of online video time grew from 29% in the first quarter of 2016 to 55% in the first quarter of 2017.

Of course, more long-form mobile video is a good thing, because it’s more likely to fetch higher ad rates.

Viewers are also likely to be more engaged with long-form content, and it’s likely to be of higher quality -- both of which are attractive to brands.

Also of note, better smartphones equate to a better mobile video experience -- which, in turn, is driving viewing.

Among other changes, the average U.S. smartphone screen size continues to grow, with the share of users owning a smartphone with a screen 4.5 inches or larger increasing from 60% in 2016 to 66% in 2017.

Cellular providers are also making it more affordable to watch mobile video on the go. In February 2017, for example, Verizon brought back its unlimited data plan option for the first time since 2011, and the other major carriers followed suit.