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Online Video Advertising Grows Exponentially

19 Aug, 2009 Response This Week

NEW YORK – Online video advertising currently accounts for just a small percentage of Internet ad spending, but according to eMarketer, it will quadruple over the next four years.

Online advertising experienced a 125-percent growth in 2008, and eMarketer estimates that there will be a 40-percent increase every year through the next four years. This means that the current $1 billion dedicated to online video ad spending will expand to $4 billion by 2013.


The company projects that U.S. online video spending will account for 4.3 percent of total online ad spending and 1.6 percent of television ad spending. But will online advertising drive TV advertising into extinction?

“As the main vehicle for brand marketer ad spending, TV is not losing its place to online video advertising anytime soon,” says eMarketer senior analyst David Hallerman and author of the new report, “Digital Video Advertising: Where’s the Money?”

If anything, the parallel ad spending formats simply have different strengths. Each one’s size of viewership is a key factor in determining which has the potential to make a greater impact. eMarketer predicts U.S. TV advertisers will spend $0.13 per hour of viewing, while their online video counterparts will spend about 30 percent more ($0.17 per hour).

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