Thursday, December 3, 2020, 12:19 PM ET|Posted by Will Richmond
Video advertising platform SpotX has released a new report detailing seven global video ad trends and predictions for 2021. Overall, the report points to a continued shift in video ad spending to data-centric, highly-measurable campaigns reaching viewers through connected devices. SpotX considers 2020 to have been the start of the “connected decade.” SpotX included insights from executives at Acxiom, AMC Networks, CCI, Discovery, DISH Media, GroupM, Samsung Ads, The Trade Desk and TransUnion in its report.
Following is a summary of SpotX’s seven predictions:
1. A “post-cable” ecosystem grows from changing consumer viewing habits. As major media companies keep launching high profile direct-to-consumer streaming services, they are hastening the shift away from multichannel TV subscriptions. In other words, rather than sitting on the sidelines and hoping cord-cutting will abate, these companies are accelerating the digital, unbundled future. SpotX, like others, sees both SVOD and AVOD services flourishing.
2. Ad spending moves to OTT and CTV, faster than expected. In the context of shifting viewing, SpotX sees advertisers as still “over-investing” in traditional TV, with budget moves into OTT and CTV in 2021 kicking into high gear. SpotX says the key here is that advertisers have learned “how to activate data for efficient audience targeting while still achieving scale in OTT.”
3. Big opportunity for device manufacturers to grow advertising revenues. With smart TV sales growing briskly and viewership data obtained at the glass level, SpotX sees manufacturers as a growing force. SpotX said that smart TV ad inventory accounts for 38% of connected TV spending on its platform and grew 800% from March to October 2020. Smart TV manufacturers will invest in the user experience and content discovery for further gains.
4. Addressable TV gains scale. Addressable TV may finally be poised for an inflection point according to SpotX as Project OAR scales in 2021. SpotX sees more inventory becoming addressable in 2021 and programmatic allowing more linear TV budgets to be transacting digitally as they would with OTT. This unlocks access to more demand sources.
5. Data-driven video campaigns increase, with more emphasis on targeting and measurability. It’s no secret that CTV and OTT have raised the bar for advertisers to find their target audiences and generate higher ROI. SpotX expects this trend to continue next year, with CTV campaign measurement focusing on brand lift, incremental reach/frequency and impact on sales.
6. Rise in programmatic guaranteed deals. Advertisers increasingly seek to bring together TV and OTT campaigns transacted digitally through programmatic buying. SpotX saw a 92% increase in spending in 2020 on programmatic guaranteed on its platform with another 154% increase expected next year.
7. Heightened priority of supply and demand path optimization. Due to the pandemic’s volatility SpotX expects both the buy and the sell sides to reduce their vendors to optimize their value chains. The emphasis for buyers will be on brand safety, viewability and fraud.
The full report, with more details on each trend, is available for complimentary download.