How much money are advertisers actually investing in digital video media?

The numbers tossed out at conferences, in reports and trade press articles typically range between $6.0 and $6.7 billion dollars. An exclusive analysis by MyersBizNet, however, suggests actual digital video ad investments in 2014 will total only $4.8 billion, far less than most digital video executives and analysts have been estimating. The $4.8b forecast more accurately reflects the budgets reported by agency executives and more closely aligns with the limited data available through reliable public sources.

MyersBizNet exclusively reports the digital revenues of legacy media categories, and estimates the percentage of those revenues represented by video. Separately, MyersBizNet reports "Online Originated Digital Video Advertising," which we estimate will be $2.195 billion in 2014. The immediate reaction by industry executives is that YouTube and Hulu alone account for a reported $2.0 billion! Adding the video revenues of Yahoo, AOL, Tremor, Yume and others must make the category total far greater. And therein lies the apparent conflict between industry data and MyersBizNet data.

It appears industry data may count a significant share of advertiser investments twice – first by including the self-reported ad revenues of digital media companies before they distribute the revenue share to their content suppliers (TV networks, producers and studios). They then add estimates of the digital video ad revenues of the networks and other video content suppliers, which include both the revenues these companies generate directly AND the revenues they generate through distribution partners Hulu, YouTube, AOL Yahoo, etc.

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2014 DIGITAL VIDEO ADVERTISING SPENDING
         
Online Originated Video Advertising:   $2.195 billion    
Broadcast Network TV:   $1.379 billion    
(Total digital revenues are $1.970 billion x 70% estimated represented by video. Networks may generate as much as 90% of their digital revenues from video, but a significant share of their digital revenues result from multi-screen packages and are therefore often over-estimated.)    
         
Cable Network TV:   $   943 million    
(Total digital revenues are $1.347billion x 70% estimated represented by video)    
         
Local Broadcast TV:   $   210 million    
(Total digital revenues $1.050 billion x 20% estimated represented by video)    
         
Local Cable TV:   $     35 million    
(Total digital revenues $  174 million x 20% estimated represented by video)    
         
Broadcast Syndication:   $     25 million    
(Total digital revenues $  122 million x 20% estimated represented by video)    
         
TOTAL:   $4.787 billion    
 Source: MyersBizNet Advertising and Marketing Data and Forecasts 2009-2020, published 1/14.
MyersBizNet reached out to the IAB for comment on our data and did not receive a response.
         

Click for full MyersBizNet Advertising and Marketing Data and Forecasts.

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