PubMatic and IAB Europe reveal the current state of online video advertising and forecasts for the coming year

PubMatic, an independent technology company that maximizes customer value by providing the digital advertising supply chain of the future, in partnership with IAB Europe, today released an industry report titled “The State of Online Video Advertising in Europe”. The report highlights the desire of media buyers to continue to increase spending on video advertising, especially connected TV (CTV).

More than 140 online video buyers from agencies and advertisers in 31 European markets participated in the survey, which provided key insights such as:

  • Digital media buyers spend an average of 36% of their total ad spend on video ads (excluding TV formats)
  • The most popular video ads are the mobile web, with a quarter of media buyers investing more than 61% of their digital budget on this channel
  • Two-thirds of digital buyers invest in CTV, albeit with a smaller percentage of the total budget.

“Media buyers are excited about the potential of CTV advertising because it is a cost-effective way to reach audiences that watch far less than traditional TV. It attracts big brands and also allows smaller brands to be featured in TV commercials. the high price tag associated with linear TV,” said Hitesh Bhatt, Senior Director, CTV/OTT, EMEA at PubMatic.

The survey also found that when media buyers find the same programmatic video inventory available across multiple selling platforms (SSPs), as is often the case, nearly half say performance KPIs are the most important factor in deciding with which SSP to work. This is followed by cost (26%) and data activation (16%)

“This focus on KPIs as a deciding factor in SSP selection underscores the importance of maximizing audience responsiveness, a well-known factor in improving performance. The combination of publisher brand ownership and proprietary data and independent identification solutions helps to better understand consumer behavior thereby maximizing the size and accuracy of responsive audiences on the open web,” said Bhatt, A/B testing of different addressing strategies is one of the best ways to determine which partners “show the first tests that a portfolio approach provides the best performance,” said Bhatt.

The discontinuation of third-party cookies has changed shoppers’ approach to online video advertising in browser environments, but despite its previous reliance on third-party cookies, it remains strong in terms of programming, with two-thirds of respondents focusing on most of its budget in programmatic channels.

The key to more digital video revenue is the lack of multi-screen metering, which is cited by 46% as the biggest obstacle and by 57% who are actively pursuing more measurable formats. While measurement is challenging, nearly a quarter (23%) of digital media buyers plan digital campaigns across multiple screens, including TV in this definition.

Marie-Clare Puffett, Senior Programs Manager Marketing and Industry at IAB Europe, commented on the study: “The state of online video advertising from IAB Europe and PubMatic provides insight into the direction of travel from Europe to this market. Publishers and the entire digital advertising industry are planning and making the most of the opportunities presented. This report shows that advertisers see online video as a strong channel for the brand, but there are also clear concerns about the device targeting that the full value of online video Advertising must be realized Given the potential for innovation in the digital advertising industry, I am confident that these concerns will be addressed and that online video will continue to be an important channel for digital advertising.”