Look for strong growth in the video advertising market in the next 5 years, says a new Forrester Report. The total video advertising market will expand from $91 billion this year to $103 billion in 2023, and nearly all of that growth will be due to online video. The TV market is huge, but it’s on the wane. Online video ads make up 21 percent of the total market this year, and that will expand to 34 percent of the market in 5 years.
While viewers will watch more online video than before, they don’t want to pick up more paid subscriptions. Expect to see a big rise in ad-supported free streaming. The Forrester report says two-thirds of U.S. adults who watch online programs think ads are a fair tradeoff for getting free video, and 72 percent would choose to watch an ad-supported version of a TV show immediately rather than wait for a version that doesn’t have ads.
Roughly 194 million in the U.S. currently watch ad-supported free online video. Not only that, but 200 million currently watch online video, which isn’t too far from the number that watch standard TV (258 million).
The report sees a strong demand for traditional TV content, although how people get that content is changing. Many look to broadcaster apps or vMVPDs to get their favorite shows. The number of TV Everywhere viewers will grow from 89 million this year to 111 million in 2023. Also, 81 million will only stream shows from broadcaster sites and apps.
“Even though traditional TV users and the amount of time spent on offline video is declining on average, the reach of TV is still expanding when we account for TV Everywhere and the rise of virtual TV services, or vMVPDs (Virtual Multichannel Video Programming Distribution), which we consider to be part of TV rather than online video. Viewers still want TV programming but are accessing it in new ways via TV Everywhere and vMVPDs,” the Forrester report says.
The full report, “Forrester Analytics: Video Advertising Forecast, 2018 to 2023 (US),” is available to Forrester customers.