It’s a confusing time for NewFront Season, the two-week period where original premium video sites unveil their upcoming shows and ask for advertising commitments. Some of the highest profile sites, including AOL and BuzzFeed, have cancelled their public newfronts, choosing smaller meetings with advertisers, instead. While there are still plenty of newfronts on the schedule, some in the industry are wondering if newfronts have a future. After all, scarcity isn’t as much of an issue online as on broadcast, and advertisers don’t feel the same need to get in early.
This morning, the Interactive Advertising Bureau (IAB), the body that administers NewFront Season, issued a report showing the newfronts are still influential. It finds that media buyers and marketers will allocate 40 percent of their budgets for original digital video after attending newfront presentations. it also finds 53 percent of that group credit expanding budgets with their increased spending on original digital online video.
In 2016, 88 percent of advertisers increased their spending on original digital video after attending newfronts.
Spending on digital and mobile video is sharply increasing. Agencies and marketers will average $9.4 million in the area in 2017, up sharply from $6.9 million in 2016. Spending is higher in all market sectors, with telecom and health/beauty showing the strongest gains.
What’s more, the share of digital advertising allocated to video is increasing. In 2015, 52 percent of digital budgets went to video. In 2016 that grew to 54 percent, and this year it should reach 56 percent.
The newfronts highlight original digital video, and the report shows that online video is taking an increasingly large share of budgets. In 2015, 44 percent of digital video budgets went to original works. That grew to 45 percent in 2016, and should reach 47 percent this year.
The survey asked about obstacles to increased spending on original digital video, finding that quality of content and price were the two biggest concerns.
The IAB’s online survey questioned 358 marketers and agency contacts. Read the full report for free (no registration required).