Combining the power of video with the efficiency of programmatic tech, programmatic video advertising has begun to dominate digital advertising budgets.
If you’re looking to get caught up on this rapidly growing space, you’ve come to the right place. This article is your guide to the programmatic video advertising market, and covers the following questions:
- What is programmatic video advertising?
- What are the latest market growth numbers?
- What are the most important trends?
- Who are the key players in the space?
Let’s jump in.
What is video programmatic advertising?
Video programmatic advertising enables advertisers to run precisely targeted and budgeted video ad campaigns via an automated ecosystem containing three primary types of players: demand-side platforms, supply-side platforms, and advertising exchanges.
- Demand-side platforms (DSPs) allow advertisers to buy ad space, host ad creative, and run campaigns.
- Supply-side platforms (SSPs) enable publishers to generate revenue by selling ad space.
- Advertising exchanges coordinate supply and demand between these two platforms using technology like machine learning and real-time bidding (RTB).
Advertisers use video programmatic because of its numerous benefits, including granularity, quantitative performance analytics, campaign optimization, broad reach across devices and channels, etc.
Growth of the programmatic video advertising market
The programmatic video advertising market has grown dramatically over the past few years — far outpacing projections.
According to Statista, a 2019 survey of the ecosystem reported that total US programmatic advertising video spend was over $24B. The study forecast that this number would jump by 11.6% to over $27B in 2020 and increase an additional 31.3% to nearly $36B in 2021. By 2022, the study projected that US spending would hit just under $43B.
But the actual figures were significantly higher than even those steep projections. A November 2021 research report by eMarketer revealed that US programmatic video spending reached over $35B in 2020 and a staggering $52B in 2021 — and was now expected to nearly hit $63B in 2022. These figures mean:
- Spending actually grew 48% between 2020 and 2021 and might grow an additional 20% over the next year.
- The real numbers for 2020 and 2021 were about 30% and 44% larger, respectively, than those forecast in the 2019 study.
Programmatic video advertising spending has also outstripped the projected growth of digital display advertising in the US.
- From 2019 to 2020, Statista estimated that programmatic digital display advertising would increase from nearly $60B to over $63B — growing just 6% — and spending would increase by 25% to $80B in 2021.
- Programmatic video advertising spending increased by 34% and 48% over those same intervals, and its 2021 figures are just 35% less than digital display advertising’s total forecasted spending.
US video programmatic spending also measures up well against global programmatic ad spending.
- Global programmatic ad spend was reportedly $112.9B in 2019, $129B in 2020, and $155B in 2021.
- US programmatic video accounted for 23% of global programmatic ad spend in 2019, 27% in 2020, and 34% in 2021.
In other words, the US programmatic video advertising is growing significantly faster than the global programmatic market overall and now represents more than a third of total spending.
Key trends in video programmatic advertising
The dominance of mobile and the rise of CTV
When it comes to devices, programmatic video is ruled by mobile — with Connected TV (CTV) a distant but fast-growing contender. Recent market research and analysis published by Statista estimated that mobile devices would account for over 75% of the US programmatic video spending in 2021. The same study placed CTV second on the list, estimating that it was responsible for just under 16% of spending and that desktops and laptops made up the final 9%.
The dangers of ad fraud
Although programmatic advertising has created unprecedented efficiencies in the digital advertising space, it also opened the door to advertising fraud. The cost of digital ad fraud in the US only grew 7% between 2011 and 2013, but recent years have seen an explosion in the instances of this cybercrime. According to Statista, damages caused by digital ad fraud in the US have increased by 184% since 2013 — and now sit at a staggering $15B.
The adoption of new formats
While traditional display ads may always have a part to play in digital advertising, few advertising experiences can match video’s storytelling ability and effectiveness. This advantage is why advertisers will likely prefer more innovative versions of banner ads, like video display banners, over the coming years. This novel format produces well over seven times higher CTR than classic display — which is likely why it’s growing 3.5 times as fast.
Top programmatic advertising video players
The number one DSP by market share, Google Display & Video 360 (DV360), is a robust platform advertisers can use to run video ad campaigns. Designed with simplicity in mind, DV360 can help advertisers coordinate cross-team efforts, understand their entire spending picture, and leverage AI to drive better results.
An established player in the programmatic video advertising market, the ironSource Exchange excels at connecting advertisers with high-impact audiences. With robust viewability verification, audience tracking, and anti-fraud tools, our programmatic marketplace offering provides the ideal environment for brands to engage with their target audiences. To start exploring what partnering with ironSource would mean for your campaigns, contact our team of mobile growth experts today.
Ranked among the top five SSPs in the space, OpenX is a premier place for publishers looking to boost their digital ad revenues. The SSP has developed an excellent reputation by connecting their clients to a vast set of DSPs and delivering outsized results for customers like Vice Media. While only publishers with larger audiences can work with OpenX, those that qualify will have the option of working with a respected partner.
Finding a programmatic video partner
The programmatic video advertising market is one of the most exciting spaces in digital marketing, and the advertisers that invest in this space will be well-positioned to drive growth over the coming years. To connect with a partner that can help you make the most of your programmatic video strategy, reach out. Our team can supply the tools, tips, and support you need to launch your best campaigns.