Digital Video Advertising Market

Market Overview

The global digital video advertising market size was valued at USD 9.02 billion in 2022. It is estimated to reach USD 35.19 billion by 2031, growing at a CAGR of 16.33% during the forecast period (2023–2031). The incremental penetration of OTT media streaming platforms and the rising adoption of social media platforms stimulate market growth.

Digital video advertising promotes goods, services, or brands through video content provided through digital channels such as websites, social media, mobile applications, and streaming services. The process entails producing and disseminating video commercials to reach and interact with target audiences. Pre-roll, mid-roll, post-roll, and in-stream advertisements that show within online video content are just a few different formats available for digital video advertising. This enables advertisers to reach consumers on many devices, including desktop computers, smartphones, tablets, and smart TVs. The benefits of digital video advertising are found in its capacity to effectively communicate brand messaging to viewers through dynamic graphics, audio, and storytelling. Through measures like views, clicks, and engagement rates, it gives chances for precision targeting, enabling advertisers to target customers with certain interests or demographics.

Additionally, interactive aspects like clickable components, interactive overlays, and social sharing are possible with digital video advertising, which promotes viewer engagement and improves brand involvement. Additionally, it offers retargeting features, which let marketers display relevant advertising to people who have already connected with their brand. In the digital age, digital video advertising has become a potent tool for brands to engage consumers, raise brand awareness, spur conversions, and improve overall marketing effectiveness.

Market Dynamics

Global Digital Video Advertising Market Drivers:

Incremental Penetration of OTT Media Streaming Platforms

The industry for digital video advertising has enormous development potential as OTT media streaming platforms continue to gain popularity. These platforms give brands and marketers better chances to connect with and engage with consumers. Additionally, cord-cutting and diversifying revenue streams may result from OTT media companies' growing market share.

The requirement for various platforms, such as PCs and mobile phones, enables advertisers to create new formats and provide users with mobile-first experiences. Thanks to sophisticated analytics tools and software, OTT platforms can enhance advertising expenditures and create new shows and series. These tools offer in-depth commentary on the effectiveness and reception of content and insights into the performance of commercial films. As evidence of the steadily rising demand for advertising space in the OTT ecosystem, Amazon's Amazon Advertisement Services provides OTT and out-stream video advertisement services to companies in the entertainment, beauty, and consumer electronics industries.

Rising Adoption of Social Media Platforms

The quick adoption of social media platforms opens up new avenues for advertising for businesses and organizations. People can routinely access their social media accounts because of the affordable internet packages offered in nations like India and Vietnam. These platforms have been extensively incorporated, allowing businesses, marketers, and advertising agencies to use social media as a powerful conduit for advertising. Brands and agencies can create video advertising that speaks to audience wants and brand value by carefully understanding how consumers prefer to consume content on social media sites like Facebook, Instagram, and Twitter.

Additionally, influencer marketing has become more popular due to increased social media advertising. Influencer marketing allows marketers to work with influencers to create video content that promotes the latter's goods and services. This helps businesses use the A/B testing technique and create adverts that connect with audiences based on their demographics, interests, and content choices. Additionally, the possibility to influence more people, penetrate the market more effectively, and increase revenue share is made possible by the quick increase in social media platform users.

Global Digital Video Advertising Market Restraint:

Rising Use of Ad Blockers

The rising use of ad blockers among consumers could be bad for the expansion of this sector. Customer complaints about recurrent commercial breaks while streaming content on multiple platforms have increased. Due to the poor viewing experience, this encourages people to use ad-blocking software. Additionally, marketers' growing usage of cookies and the expanding application of AI-based prediction models provide more in-depth information about users that endangers their security and privacy.

The General Data Protection Regulation (GDPR) was implemented in the European Union, giving consumers the power to control and secure their data. This prevents advertisers from collecting personally identifiable information (PII) about individuals. Additionally, consumers' ability to browse the internet and consume content is hampered by background adverts because of network splitting, which results in slower page loads and lower picture quality. This further encourages users to use ad blockers.

Global Digital Video Advertising Market Opportunities:

Computerized Advertising

Programmatic advertising, which uses automated systems and algorithms for ad buying and placement, is superior to digital video advertising. Digital video advertising uses manual methods and algorithms. This is because programmatic advertising enables a higher level of both efficiency and precision to be achieved than digital video advertising does. This particular benefit is one that digital video advertising does not have, which is one of its disadvantages. The programmatic video advertising market has much room for development because it allows marketers to target specific audiences, maximize real-time campaign performance, and benefit from data-driven insights. As a direct consequence, the industry has significant untapped potential for growth.

Regional Analysis

North America Dominates the Global Market

Based on region, the global digital video advertising market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

North America is the most significant global digital video advertising market shareholder and is estimated to exhibit a CAGR of 36.4% over the forecast period. There is a high likelihood that these phenomena can be attributed to the high percentage of people in this region who own cell phones. Marketers are beginning to use digital video advertising methods due to rising needs among brands and agencies to capitalize on the growing number of digital viewers and capture a larger percentage of screen time. This is one of the reasons why marketers are beginning to use digital video advertising methods. Marketers find this a compelling reason to adopt advertising tactics based on digital video.

Additionally, an increasing number of consumers in this region are canceling their cable subscriptions and beginning to adopt the incremental trend of switching from traditional cable TVs to over-the-top (OTT) media delivery systems, creating development potential for the industry. This shift occurs due to the incremental trend of moving from traditional cable TVs to over-the-top (OTT) media delivery systems.

Asia-Pacific is anticipated to exhibit a CAGR of 46.1% over the forecast period. Advertisers are encouraged to use digital media to deliver video commercials because consumers can more easily adopt the technology on a big scale due to the availability of competitively priced high-speed internet services in the region. The rising number of individuals in this region who use social media offers advertisers a new channel for the collection of income, which further increases the prospects for the expansion of the market. The growth of short video applications like Kuaishou and TikTok and their enormous user populations in the subcontinent are leading marketers and businesses to use these platforms for digital video advertising. Other examples of these types of applications are Snapchat and Instagram Stories. These applications include Kuaishou and TikTok as just a couple of examples.

Europe offers numerous options in the digital video advertising business. The area boasts high levels of internet use, cutting-edge digital infrastructure, and a sizable audience for online video consumption. OTT platform popularity, programmatic advertising, and mobile video advertising are opportunities to take advantage of. Advertisers may capitalize on the broad European market by adjusting their video advertisements for various languages and cultural quirks. Advertising companies have the opportunity to develop immersive and compelling ad experiences for European viewers because of the rising desire for personalized and interactive video content.

Latin America offers great potential for the digital video advertising market due to the region's strong rise in digital video consumption. The region has a sizable and active audience, especially among younger generations. Due to the extensive use of smartphones, mobile video advertising is gaining ground. Advertisers can use the popularity of social networking sites and streaming services to reach people throughout Latin America. Localization and cultural relevancy are essential in this region to engage with various audiences in various nations. Additionally, programmatic advertising and data-driven targeting can assist advertisers in streamlining ad delivery and connecting with certain target markets.

In the Middle East and Africa region, increases in mobile connectivity, internet usage, and digital transformation are all occurring. The digital video advertising market will benefit from this growth potential. Digital video content consumption in the area is rising among its young, tech-savvy populace. Localized content, programmatic advertising, and mobile video advertising are tools advertisers can use to interact with audiences in the MEA. Additionally, since the region's e-commerce, entertainment, and tourist sectors are expanding, video commercials are available to target these sectors. When creating video ad campaigns for the MEA market, advertisers need to consider local laws, language preferences, and cultural sensitivity.

Segmental Analysis

The global digital video advertising market is bifurcated into product and industry verticals.

Based on the product, the global digital video advertising market is bifurcated into desktop and mobile. 

The desktop segment dominates the global market and is projected to exhibit a CAGR of 39.7% over the forecast period. The shift away from viewing television in favor of other forms of digital media is being pushed by the changing lifestyles of consumers and the variety of entertainment options available to them. The widespread trend among users to access multimedia content via desktops and laptops due to a better viewing experience is driving advertisers to use desktops as a preferred channel to engage in advertising tactics. This is because desktops provide users with a more streamlined viewing experience. This is because desktops provide viewers with a more immersive experience.

Desktop advertising allows marketers to display their messages on more visible portions of larger displays. This has a deeper influence on audiences and motivates individuals to do particular activities, such as purchasing or signing up for a certain service. Desktop advertising has been increasingly popular in recent years.

Based on industry verticals, the global digital video advertising market is divided into retail, automotive, financial services, telecom, and consumer goods and electronics. 

The retail segment is the most significant contributor to the market and is estimated to exhibit a CAGR of 34.3% over the forecast period. Digital video advertising delivered to PCs and mobile devices paves the way for businesses and marketers to identify and assess search results using cookies. This is made possible by digital video advertising. Because of this, merchants can have a comprehensive understanding of the needs and preferences of their customers. By gaining an awareness of the requirements and preferences of their clientele and stocking goods that cater to these requirements, offline companies have the potential to enhance the shopping experience of their clientele and, hence, increase customer satisfaction.

In addition, digital video advertising may be implemented in retail establishments to facilitate interactive and enjoyable customer shopping experiences. This boosts the efficiency of advertising campaigns and ensures effective client acquisition. Tablet computers and other types of mobile devices can be utilized to complete this task.

Recent Developments

• April 2023- To enable marketers to use deep, cookie-free, and contextual TV data to efficiently target and measure activations, Viant Technology Inc. teamed with IRIS.TV. The collaboration would provide marketers with greater precision and aid businesses in providing customers with targeted adverts.
• February 2023- To reduce the carbon footprint of its digital advertising efforts, Viant Technology Inc. partnered with Scope3 and committed to achieve carbon-neutral energy use by 2023.