Video ads Report 7.5X More CTR Compared to Display

Brief

• On average, the CTR for video on mobile apps is more than display ads by 7.5 times going by a study released by Smaato and Liftoff. The two companies found that rewarded video ads are cheaper than video even though they have the same conversion rates across different performance indicators.

• eCPMs for interstitial display ads were found to be 4.6 times higher than banners. They had an average CTR 18 times more than it was for banner ads. Native, interstitial, and banner ads have similar costs per actions like purchase, registration, and installation.

• iOS devices were found to have higher costs and better rates of conversion compared to their Android counterparts among all formats studied. The study considered three trillion requests running on Smaato’s platform in the first three months of 2019. The requests received 80 billion impressions.

Insight

Mobile marketers have to think about the trade-offs between expending more money for video ads and the potential to get higher CTR than in display ads. The report by Smaato and Liftoff suggests that rewarded video is cost-efficient. By offering incentives, one can reach users as they engage with other content like games.

The findings offered confirmation for other research that pointed toward viewer receptivity to video ads that provide an option to opt-in. Nearly 80% of consumers who interact with digital video are open to ads as long as they get free content according to a report from IAB. Over 50% of the viewers admitted being partial to contextual ads. 37% said they liked targeted advertisements as long as they were centered on their interests.

Mobile video ads are essential if marketers will reach tech-savvy consumers as they go about their daily activities. Last year, revenue from digital video surged 37% to get to $16.3 billion from the previous year’s $11.9 billion. No other format saw growth as impressive as digital video ad revenue. 63% of video revenue was from mobile, an improvement from a prior 52%. Mobile video ad spend in the U.S is expected to go up to $24.8 billion by 2022, according to eMarketer. Social video ad spending will increase by 44% to get to $14.9 billion by 2021. Brands are expected to work harder to reach young audiences who prefer platforms like Instagram, Twitter, YouTube, and Facebook.

Google, Amazon, and Facebook are working to grow mobile video ads in several ways. Amazon is looking for more marketers to adopt video ads according to the Business Insider. The e-commerce giant is looking to boost sales. Google, on the other hand, is working to overcome slowing revenue growth. It is responding to the threat by Amazon by introducing shoppable recommendations in videos on YouTube. The six-second bumper ads will be easier to roll out as brands will create more transactional videos. Facebook is zooming in on premium video ad revenue. The platform introduced an updated system for ranking video to help viewers interact with more content. The platform also launched an initiative in India, its key growth market. Thumbstoppers is meant to help challenge agencies to form more compelling short ads meant for mobile viewers.

More and more people are using smartphones to interact with video content. This will underpin growth is advertising, especially when coupled with the adoption and expansion of 5G networks all over the world. In the U.S, the average adult will be spending close to four hours every day on their phone excluding voice. 80% of that time will be dedicated to app use according to a forecast by eMarketer. Cellular carriers like Sprint, AT&T, Verison, and T-Mobile are pushing 5G in the U.S and will be debuting mobile devices to match those speeds in the years to come.

https://www.mobilemarketer.com/news/study-video-ads-see-75x-higher-ctr-than-display/555298/

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