Online Video Ad Budgets Expected To Rise Sharply In 2012

Here’s some good news for web video publishers and producers. Online video advertising budgets are expected to jump sharply in 2012. Brand advertisers who purchased online video ads this year are projected to spend 47 percent more next year. These numbers were released this morning in the second annual “Video State of the Industry Survey” by and Digiday.

For advertisers that didn’t purchase any video ads so far this year, 84% say they will include digital video in their campaigns in Q4 2011 or 2012.

Advertisers say they are most likely to shift spending away from display and print ads to fund the increased online video spending. While some have feared online video might start replacing TV ad spending, the report claims television ad budgets, especially for cable, are safe for now. A majority of advertisers say online video ads are a direct compliment to TV, not a replacement for TV ads.

The report, which surveyed nearly 600 advertisers, publishers, and video technology providers, says rates for interactive video ads are up an average of 19 percent over last year.

Some other key findings:

  • Brand engagement is the top online video campaign objective.
  • Sharing video via social networks is an important return-on-investment metric for buyers.
  • Rich media overlays, pre-rolls, and content integration are the favorite ad formats.
  • Page-roll, expanding video banners, and post-rolls are the least favorite.
  • Video ad spending on the iPad is up 18%, the highest among all devices.
  • Average CPM for Premium content, broadcast content online: $21-$30
  • Average CPM for Mid-Tier, professionally produced content: $11-$20
  • Average CPM for User Generated Content: $0 – $5

A webcast about the findings will be streaming at Noon ET at There will also be a Twitter-based Q&A at 1pm ET via with the hashtag #StateofVideo. When the webcast ends, the report will be available online at

The business and technology of online video will also be the big topic today when the Streaming Media West conference kicks off in Los Angeles.

[Image: robertlamphoto/Shutterstock]