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Video killed the radio star. What’s video’s next move?


Edited version originally posted on MediaPost.

Consumer media consumption is in the midst of the greatest behavioral shift since the advent of the cable box, when consumers abandoned networks for the choice and variety of cable television. Now, both networks and the cable companies are being displaced by the likes of Netflix, Amazon, Apple, and Roku, leading the way to a world of personalized, on-demand content consumption. Changes in how we consume media are accompanied by where we consume video-based media, and the clear trend is that we’re doing it on-the-go. Video is becoming a mobile medium. This shift impacts not only content developers, but also the brands and marketers who rely on on traditional and digital media forums to pitch their wares through the beloved “TV” commercial.

Desktop streaming video is one of the fastest growing advertising categories, and brands will continue to charge along this path. Afterall, streaming video advertising allows for the type of targeting marketers crave—and that network and cable providers have failed to develop. However, mobile video advertising is just getting started. According to eMarketer, the U.S. video ad market will grow to $7.7 billion in 2015, and U.S. mobile video will grow more than 70% in 2015 reaching $2.5 to $3 billion. By 2019, almost half of all video advertising is expected to be mobile video.

Audiences and Mobile Video—Looking Back to See Ahead

Cable TV’s growth exploded in the 1990s with the number of networks tripling in less than a decade to over 170. Marketers’ ability to target specific consumer audiences increased dramatically based on the context of the available programming and the ability to deliver messages for specific markets. The incumbent networks simply couldn’t keep pace and marketers got more bang for their buck through targeted cable advertising.

The market for digital video advertising is undergoing a similar transformation. Digital video advertising has typically been the realm of large video publishers such as YouTube, Hulu, and others. But the number of video-based delivery channels, specifically in the mobile space, is growing exponentially. Marketers are realizing that it isn’t enough to simply show video ads. Those ads need to be engaging, viewable, and, most important, targeted.

Mobile has always been a realm in which the best targeting wins the day and due to its unique, on-the-go properties, mobile has always offered marketers interesting targeting capabilities. Proximity targeting, location-based audience targeting, and other forms of contextual targeting are frequently deployed for traditional IAB ad units. Now, marketers are experimenting with those same targeting technologies, but applying them to video-based ad creative.

Context on Steroids

Mobile is synonymous with on-the-go consumers; targeting will decide the winners and losers during this paradigm shift. Advertisers are no longer gambling with their brand’s money on mobile. Hyper-targeting and personalized content are driving brand loyalty and real-time purchasing. In an ever-changing landscape, brands are looking to target users in more meaningful ways, in hopes their brand messaging resonates with their consumer.

The opportunity for video-based marketers to target on an incredibly granular level is now on the table. Unlike a TV, mobile devices go everywhere we go. Mobile devices allow for insights about consumers' real-world behavior, enabling marketers to use video advertising in an entirely new way. And consumers’ engagement with mobile video ads, at home and on-the-go, is one of the biggest opportunities for digital marketers.

We are at the cusp of the mobile video advertising era, and there are challenges ahead. Snapchat, Twitter, Instagram, and others, all have varied mobile video ad specs, which makes it difficult to find a standard. Traditional desktop streaming players are making the jump to mobile and many KPIs are yet-to-be-decided, making this an exciting time to be in the mobile marketing space. The possibilities to combine mobile video ads with intricate personalization are astounding to think about when you consider how personal mobile devices intrinsically are. As a mobile industry, we need to take advantage of all the unique properties mobile has to offer. Other mediums don’t travel with you to the drugstore, theme park, or restaurant, but mobile devices do. The winners in this space will be the one’s who build the best user experiences and deliver the best targeting, by using the best available data.

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