According to a 2018 eMarketer report, mobile phones will surpass TV as the preferred medium of entertainment minutes in the U.S. this year. Do advertisers have the right strategies in place to leverage this paradigm shift?
This milestone turnaround has been coming for a bit now, but it is finally here.
The biggest driving factor here is the younger audience that is driving mobile video watching. “Video accounts for more than half of total media consumption — and the time spent is growing at a faster rate than any other media,” reported the National Research Group (NRG) in its most recent study, “Handheld: Insights on the Evolution of Video.” These studies were commissioned by Snap Inc are to highlight how mobile video consumption is evolving.
NRG found that
- Adults age 18 and over, spend 11 hours with various media across devices
- Video consumption accounts for six of those devices focused hours.
- Two-thirds of Gen Z and Millennial audiences have increased the amount of mobile video they watch since last year,
- The majority of this younger demographic watch more than an hour of short-form mobile video (videos 10-minutes or less in length) weekly.
The Effect of Advertising Strategies And Budgets
In October 2018, eMarketer had some interesting estimates about advertising budgets on mobile and video. It also observed that in 2018, video accounted for 25% of digital ad spend in the U.S. It also predicted digital ad spend would surpass traditional ad spend by the end of 2019. In this process, TV ad spend has seen a 2.2 percent drop to $70.83 billion.
“For the first time, digital ad spending in the U.S. will exceed traditional ad spending,” wrote eMarketer in February. “By 2023, digital will surpass two-thirds of total media spending.”
With an increasing digital ad spend, video ad spend grows as well. Some good case in points:
- Twitter attributed more than half of its ad revenue during the first quarter of 2018 to video ads.
- Snapchat reported its premium mobile video ads were watched by over 70 percent of the total 13- to 34-year-old U.S. population on a monthly basis during the last quarter of 2018.
“In 2019, video will become an even bigger focus with formats like Stories taking center stage across the Facebook Inc. portfolio, which includes Messenger and WhatsApp alongside Instagram and Facebook,” said Goldman, “We also expect growth with in-stream video as Facebook delivers more long-form, curated and original programming through Watch and IGTV.”
“The steady shift of consumer attention to digital platforms has hit an inflection point with advertisers, forcing them to now turn to digital to seek the incremental gains in reach and revenues which are disappearing in traditional media advertising,” said eMarketer forecasting director Monica Peart.
To stay relevant and remain ahead of the curve, marketers will have to focus on mobile video consumption. With such a critical prediction of inflection point, eMarketer’s prediction that mobile will surpass TV — advertisers’ attention will need to be on two big issues. Firstly, to ensure their video ad investments keep pace with online video consumption. Secondly, keeping an eye on the RI that traditional TV ads are delivering. It may be time to tweak the strategies a bit, to meet the changes in consumer interests.