Nearly half of the growth in local video ad spend within the next five years will go towards digital platforms including local mobile video, local online video and out-of-home video, according to a new study on advanced television advertising published last week by BIA/Kelsey industry analysts. The overall growth in digital platform advertising closely matches the expected growth in local cable TV advertising during the period, the report dubbed “Advanced TV: Industry Views on Progress & New Directions,” concluded.
The July research compiled by BIA/Kelsey’s local ad envisions $7.1 billion growth in local cable ad spending next year compared with $5 billion for local online, mobile and out-of-home video spending. In 2021, local cable ad growth will amount to $6.9 billion, while the combined local digital platforms will tally to $6.7 billion. In addition to this they also forecast that by 2021, local digital “ad activation” will represent 43.6% of local ad spending versus 56.4% for “traditional” video media. This will make a significant increase from today’s 33.2%/66.8% split. The local linear TV and digital video combined platforms are expected to grow from $31.9 billion in 2017 to $37.3 billion by 2021. The broadcast TV segment will grow $2.7 billion and the cable/MVPD segment will grow by $200 million.
“We are seeing very interesting innovation in cross-platform solutions, audience targeting, local data management platforms and a drive toward more accountability in media campaigns,” according to the BIA/K analysis. “These innovations may bend current trend lines in the media mix if linear video can become competitive.”
The study included extended interviews with top six media and technology executives, including Steve Silvestri, who is the vice president of advanced advertising at Discovery Communications.
“The [Engage] platform has consistently showcased its ability to mine high value programs across the Discovery portfolio that may have been previously unconsidered, but now afforded through selling title optimization,” Silvestri explained. “Most of our advertisers are purchasing audiences deeper across our portfolio and expanding their network consideration set.”