Research

Our accountant, Eriona, reviews the 2017 IAB Adspend results

Our accountant, Eriona, reviews the 2017 IAB Adspend results

Money can’t buy happiness, but it sure can buy a lot of advertising. Last year, the UK's digital Adspend was estimated to be a whopping £11.55 billion. But what does this mean for Coull and the rest of the advertising industry?

Eriona, Coull accountant, reviews IAB Adspend

Eriona, Management Accountant at Coull

Our new Management Accountant, Eriona, is here to give you the low-down on the IAB’s 2017 Adspend figures and what they mean for this following year.

Plants growing

[source: giphy]

The industry is thriving

It’s clear to see that the UK digital advertising market has healthy growth, there’s year-on-year growth of 14.3%, whereas, TV advertising saw a -3.2% dip in growth. The online advertising industry is now worth £11.55 billion, this is good news for many businesses in the industry, such as ad tech, because it shows the continuing success and money being put into the industry. As for advertisers, digital ads offers much more efficient and flexible options compared to traditional, offline advertising.

 

Man driving

[source: giphy]

Video is in the driving seat

We know that there’s accelerated growth in the industry, but what is driving this? Video! For the first time, online video has become the largest display format, with an impressive 47% year-on-year growth. Not only this, spend on video surpassed the £1 billion mark in the last year. This evidently demonstrates how important video is to advertisers.

 

Phone scrolling gif

[source: giphy]

Smartphones are also driving growth

It’s interesting to see that 2017 was the first year that UK adults spent more time online on smartphones than on computers and tablets combined, with smartphones accounting for 59% of time in the final quarter of 2017. As we can see, advertisers have noticed this change in media consumption because they spent £5.2 billion on smartphone ads last year - a 37.4% increase on 2016. As smartphones are becoming increasingly popular, we're expecting the ad spend on mobile to increase too.

 

What’s next?

Mobile video will rule

One thing’s for sure, video and mobile will be centre stage in the following year - video as the hottest format and mobile as the most popular platform. So we’re expecting these two to continue to be the main drivers of growth.

A more creative focus

There’s been a recent industry focus on improving ad quality, specifically mobile ads. As the IAB’s Fit For Purpose research shows, “a statistically significant percentage increase in several key brand metrics including, brand consideration (+56%), trust (+33%) and perception of premium (+21%) for the smartphone-optimised ads.”

For better mobile ads, the IAB recommends:

  • Thinking about how the ad will be executed on a smartphone from the start of the creative process
  • Including brand messaging upfront from the start of the ad
  • Testing ads on different screen sizes to ensure text and imagery are clear

So no doubt, creativity in the mobile/video space will flourish as more and more advertisers put more thought and more spend on these formats.

Turning the tables on the duopoly

It’s no secret that the Facebook/Google duopoly is dominating the advertising market, but that doesn’t come without its struggles. Both companies have appeared in the news recently, with the Cambridge Analytica scandal and brand safety troubles on YouTube. This has resulted in a surge of people deleting Facebook and advertisers pulling their spend from YouTube.

This is giving smaller businesses an opportunity to compete with viable alternatives or partnerships. There’s already a huge amount of company consolidation taking place and forecasted, such as telco AT&T are in talks to buy ad tech business, AppNexus. Partnerships between independent publishers could also pose a challenge against the duopoly, like the joint advertising platform for News UK, Telegraph and Guardian.

Could this be the beginning of the tables turning?

The future for Coull

It’s especially exciting times for Coull because we centre our business and technology around video. We strive on being at the forefront of innovation in the video space and it’s great to see that video is now the largest display ad format. We’re proud to be part of a thriving industry.

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A little bit about Eriona

Although Eriona has lived in the tech-centred Bristol for the past 19 years, she is originally from Albania. She has 3 years of finance experience in companies such as HSBC and BDO and is now training to become a chartered accountant.

Her role at Coull is varied but it mainly encompasses the managing of accounts, reporting, invoices and banking. Not only this, she is delving into the world of ad tech and learning about the digital advertising landscape.

Eriona was first drawn to digital advertising because of the huge growth in the industry and she was intrigued in seeing the future of online advertising. Then, she came across Coull, “after some research, I found Coull and their exciting technology. The OverStream Suite itself really interests me because of its versatility in the market and its potential to disrupt many segments of the digital ad market, such as video and display.”

Posted by Naomi Sandercock in Coull comment
The Power of Video

The Power of Video

Online video has been around ever since I can remember, I grew up with it - even if it was through a dodgy dial-up connection. But video advertising has also been around since I can remember, and it’s not all been as positive. Don’t get me wrong, when advertisers get video right, they really get it right, like this famous ad from Cadburys. But why are high-quality, memorable and relevant video adverts so few and far between?

Gone are the days when advertisers could spend weeks and months planning the perfect advertising campaign for a billboard or magazine page. We’re now living in a fast-moving, rapid-consuming world, we want video and we want it now. There’s a panic amongst advertisers, millions of videos are being watched every day and adverts need to follow that audience. And so, rushed, ineffective and non-engaging video ads are born, in an attempt to get something - anything - into the video space, ignoring quality and only focusing on the quantity.

And that’s just where the advertising industry has gone wrong. There’s such a rush to get into the video space, in front of an audience, that the most important thing has been forgotten...the people watching. There’s no use putting a message out there, if it isn’t high-quality content, if it doesn’t engage and if it’s not relevant.

Videos can be powerful, but we need to learn to harness that power to win over audiences once again.

The Power of Video

Last week, we hosted a breakfast event all about digital video, called The Power of Video. The aim of this event was to discuss the current state of the online video advertising industry and how to unlock the power of online video.


The IAB’s Senior Industry Initiatives Manager, Mike Reynolds, presented first, focusing on video trends and creative research. He shared some research to emphasise the huge growth of the video market.

Video is driving market growth

X3 | The time spent watching short video clips online has tripled in the last three years.

Source: IAB / YouGov consumer insights, October 2017

£699m | Online video has overtaken banners as the largest display format.

Source: IAB / PWC Digital Adspend Study H1 2017

But he also touched on how mobile is such a big influence on advertising spend.

Mobile video is also driving growth

68% | Mobile video is up 68% year on year, making it the fastest growing format.

Source: IAB / PWC Digital Adspend Study H1 2017

Lastly, he spoke about the IAB’s research, ‘Fit for Purpose’. This research looks at how advertisers tailor creative video ads for mobiles. If you would like to find out more about ‘Fit for Purpose’, the IAB is hosting the official research launch on 20th March 2018.

Next up was Coull’s very own Director of Agency Sales, Alex Wright.

Alex asked the question, why are videos so powerful? The answer: it’s part of our DNA. Paying attention to motion and avoiding cognitive strain are just a few reasons why we are hard-wired to favour video over any other format.

Perhaps more importantly for brands, is that videos can generate far more emotional cues than a photo can, with the ability to tell an extensive story and appeal to a wider range of senses.

It's ideas that evoke specific emotional responses: joy, sadness, anger, laughter etc. These emotions fuel passion and drive human behaviour while building a brand relationship with an audience.

Emotions form brand connections

But, as Alex went on to say, that power is being diluted through poorly made videos that don’t take their audience - or the device they’re watching on - into account. However, here are the 4 action points from Alex on how to get the most out of your video advertising:

how to unlock the power of video advertising infographic

Follow these steps and we can say goodbye to videos that make little to no impact and say hello to engaging, high-quality videos that connect brands and audiences.

Are you unsure of the best way to follow-up a pre-roll? This is where we can help.

We enhance the impact of your pre-roll by giving it an immediate follow-up within the video player. We can offer a variety of follow-up options from within our OverStream Suite. When you pair our OverStream formats with pre-roll, we call this DoubleUp.

Our OverStream Suite formats:

OverStream Banner - video advertising format

Banner

Our simplest format that delivers results from inside the video stream.

The Banner appears for 30 seconds, offering brand engagement opportunities. The user can choose to dismiss the advert at any time with a clearly distinguished close button.

 


 

Minimising MPU

Grabs attention and encourages action, with your audience in mind.

The Minimising MPU format appears in the corner of the video player for 5 seconds before minimising to a small ‘ad-expand’ icon that re-expands on user interaction. The user may then engage with, or close, the advert at their discretion.

OverStream Minimising MPU - video advertising format

 


 

OverStream OnPause - video advertising format

OnPause

An intelligent ad format, shown when the audience clicks pause.

OnPause delivers an ad on the video player each time it is paused by the user. This is easily dismissable via the ‘dismiss’ button or automatically when content is resumed.

 


 

 

However, we see the value of both high-quality pre-roll and high-quality video content. Our aim is to add value to any video. So, if you would prefer to not use pre-roll, you can still reach video audiences solely through any OverStream format, so you can still make use of a valuable and viewable online space.

If you’re interested in how Coull can help you harness the power of video advertising, check out The OverStream suite or contact us.

 

Take a look at the photos from The Power of Video...

Posted by Naomi Sandercock in Coull news

What the latest PWC and IAB Adspend report means for 2017

The latest PWC and IAB Adspend report has been released, so let’s have a look at what this means for 2017. These figures are based on the first half of 2016 compared with the first half of 2015.

Increased spend

The overall findings show that digital adspend continue to increase and, compared to the same last year, it’s 20% higher. So although Toblerone’s changing shape, at least something in our retail economy is getting bigger: digital adspend.

toblerone - IAB adspend

The report stated that, historically, around 53% of the year’s revenue comes from the second quarter. So we should see further growth when the next report is released. The trajectory is going one way…up!

IAB adspend chart

Domination in mobile revenue growth

IAB adspend - historic mobile video growth

‘Digital video on smartphones and tablets saw strong triple-digit growth, reaching $1.6 billion in HY 2016, an impressive 178% rise from HY 2015.’

We’re seeing strong revenues across the board but, unsurprisingly, the spend has shifted towards the mobile platform.

We know mobile ad formats are doing well, but the IAB has also taken a look at which categories are performing better. It’s no surprise that retail is right there at the top. Mobile-targeted retails ads are only beginning to take-off. So the second half of the year will reveal more about the changing purchase journey.

Whilst desktop search was down from 2015, combined desktop and mobile search is actually up 17%. This just goes to show how the mobile device is taking over. Mobile is definitely an area where more analysis and investment will be focused on in 2017.

IAB adspend - ad revenue by category

Video is really showing its strength across all platforms. As we introduce more relevant and better mobile experiences, mobile video is set to be the main revenue generator for media companies.


Check out The OverStream Suite of advertising formats to see how we’re making better ad experiences that are high performing, yet non-interruptive.

Coull's OverStream Suite of video advertising formats
Posted by simonholliday in Coull comment

Digital Advertising: Click-Through Rates

With digital ad spend swiftly rising year on year (Emarketer) it’s hard to ignore the change in the advertising landscape. We’ve come a long way from flashing banner ads and invasive pop-ups (although they are very much still around).

Advertisers are suffering from consumer ‘banner blindness’ and so are being forced to move away from standard formats and to be more creative in reaching their audiences. We all know that there’s a huge range of online advertising formats out there, but which ones should you bin and which ones should you adopt?

Check out our infographic below which details the average click-through rates from a range of online advertising formats.

Sources listed at the bottom of the page.

We’ve focused on click-through rates here as they are one of the most widely used metrics to evaluate the effectiveness of an ad format to drive response. However, it’s important to note that with any rich media ad unit that features brand creative, engagement rates are only one side of the coin. For many advertisers digital advertising is as much about branding as it is direct response. However, with attribution in brand uplift difficult to measure without focus groups and consumer research, click-through rates will remain a key metric for some time to come.

Trends in engagement

The building trends in digital advertising include real time bidding, online video, social media and of course, mobile. Something that can be be seen in all these formats is the buzzword of the moment – yes, native advertising. It seems pretty obvious that relevant, integrated advertising is going to be more effective these days than the more traditional methods. But what do the stats say?

Let’s look at the click-through rates (CTR). At the lower end of the scale display ads are seeing a CTR of around 0.11% and falling (Smart Insights). Mobile banner ads are performing slightly better at an average of 0.35% CTR (Marketing Charts). In fact, mobile advertising seems to perform better than desktop all round. Facebook news feed ads on mobile devices have an average CTR of 3-6% (Digiday) – a pretty impressive statistic. But what do you do if you want to completely trample those figures? You invest in mobile video ads. With a staggering reported CTR of 11.8% (Mobile Marketer) it’s hard to push to one side. Combine that with some clever native advertising and you’re on to a winner.

Video advertising in the marketing mix

We’re seeing brands and publishers increasingly taking advantage of these engaging and contextual advertising formats – and it’s paying off. A recent IAB report found that advertising revenue in the US from digital video increased by 24% in 2013 from the previous year and mobile revenue soared by 145% in the first half of 2013 (IAB). David Silverman, a partner at PwC US comments:

“This report not only confirms that brands are making a greater commitment to interactive, but also points to the fact that mobile and digital video are being identified as integral elements of the marketing mix. Internet advertising’s ability to impact and engage is evident across digital screens, whether big or small.” (IAB)

It’s an exciting time for the industry – with these developments in digital advertising technology opening up a better way for advertisers to reach their audiences. There are certainly some doubts surrounding native advertising, and there’s some catching up to do in mobile marketing, but the industry has come a long way since traditional advertising formats which arguably have pushed consumers away with their irrelevancy and invasive nature. Consumers are embracing new screens and new media, so that’s where we need to be.

In our next piece we will be exploring why engagement rates in mobile advertising is becoming increasingly higher than that of desktop.

Desktop
Display ads 0.1%
Google display 0.4%
Facebook news feed 0.5% – 2%
Facebook display 0.12%
Twitter 1% – 3%
Video 4.25%

Mobile
Facebook news feed 3% – 6%
Display ads  0.35%
Native ads 1.37%
Video 11.8%

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