Steady growth in online video viewership, combined with the ability to target specific viewers based on preferences and viewing history, will push U.S. revenues for online video advertising over $1.3 billion in 2010, according to Dallas-based research firm Parks Associates.
However, large percentages of consumers, especially younger ones, have yet to form a strong opinion regarding targeted advertising, according to the firm’s recently released research report Online Video Advertising: Strategies and Results. These ads include commercials shown before an online video or overlays displayed during a show, with the content based on users’ internet, TV and mobile usage and viewing habits.
Among U.S. broadband households, almost 50 percent of heads-of-household adults aged 18-34, for example, are indifferent to targeted advertising. What’s more, 42 percent of heads-of-household adults aged 25-54 and 25 percent aged 55 or older are similarly neutral, according to the report.
While online video doesn’t yet have the same audience reach as traditional broadcast and cable TV, the medium continues to grow its user base, according to the report. And increased content offerings via TV Everywhere initiatives will bring in more viewers and boost advertising revenues, the report continued.
TV Everywhere is an authentication system whereby certain premium content (e.g., movies, TV shows, etc.) are accessible online via a variety of display devices, including PCs, mobile phones and TVs — but only if users can prove or “authenticate” that they have a subscription to a multiservice operator, such as satellite, cable, telco TV, etc.
Currently, more than 50 percent of heads-of-household adults aged 25-54 watch online video at least weekly, and the percentage jumps to 75 percent for ages 18-34.