Mobile Video is Driving Growth in UK Online Ad Budgets

Mobile video advertising’s growth surged again in the UK in 2016, according to the latest ad spend report carried out by PWC on the IAB’s behalf. Mobile video ads were the fastest-growing format, doubling in size (103pc) to £693 million. Consequently, they alone accounted for 29pc of the total growth in online ad budgets.

Total video advertising (on both PC and mobile) saw growth of 56 percent, which was driven largely by outstream/social in-feed, which grew 243 percent to £465m. Outstream accounted for 56 per cent of mobile video, and 43 per cent of all video spend – while pre-roll and post-roll spend grew 12 per cent to £603m, accounting for 55 percent share of all video advertising. The amount UK companies spent on internet ads rose 17.3 percent year-on-year to £10.3bn in 2016.

The rise in mobile video ad budgets reflects online YouGov data that showed that within the last six months, 54 percent of British smartphone users watched video clips on their phone, with two-in-five of these saying they do more of this than a year ago. A significant number have also watched TV programmes (17 percent) and films (11 percent) on their smartphones. This behaviour is much more prevalent among 18-24 year olds, with 75pc watching short clips, 44 percent watching TV and 33 percent watching films on mobiles. Six-in-10 people who watched short clips, TV or film on their phone did so whilst ‘out and about.’

Alongside video and mobile, social media continues to grow, with budgets rising 38pc to £1.73bn. People’s tendency today to use their mobiles for social media means that 79p in every £1 spent on social media ads goes on mobile, while just 21p goes on computer or tablet ads.

IAB Ad Spend

“People are increasingly using their smartphones to watch more clips, programmes and films,” said the IAB UK’s Chief Marketing Officer, James Chandler. “Consequently, as companies have to follow what the industry calls “eyeballs” to get their ads in front of people, they have to allocate more budget to mobile and online video as that’s where people are spending more time.”

UKOM, the official body that measures online behaviour, shows that nearly half (48pc) of adult’s internet time is now spent on smartphones³, compared to 38pc on desktops/laptops and 14pc on tablets. As a result, mobile ad budgets increased 51pc to £3.87bn and mobile now accounts for 38p in every £1 spent on internet ad

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