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Video becomes fastest growing ad format in Q2 2017: Smaato

Highlights
  • APAC was the top performer in terms of eCPM growth
  • In-app mobile advertising surpassed global milestone
  • Android reigned supreme in mobile advertising spend in Q2, while iOS dominated eCPMs
  • Gender data increased the value of the ad space on average by 158%

With rise in consumption of online video content globally, publishers are also doubling down on the format, according Smaato’s latest mobile advertising report. The report highlights that, video was the fastest-growing ad format during Q2, with spending on video ads more than doubling (142 per cent).

Smaato conducted an in-depth analysis of the 1.5+ trillion ad impressions delivered on its platform in the second quarter of 2017.

Within the video format, the report found that certain formats are growing more rapidly than others. While full-screen interstitials remain advertisers’ darlings today, accounting for almost two-thirds of total mobile video ad spending, rewarded video was the fastest-growing format. In Q2 2017, rewarded video ad impressions almost doubled (96 per cent), ad spending increased 153 per cent and eCPMs grew 48 per cent.

While the Americas fueled global Q2 mobile ad spending growth, APAC was the top performer in terms of eCPM growth, with average eCPMs more than doubling versus the same quarter last year.

China continued to create massive opportunities for mobile publishers and advertisers as Chinese mobile users spend 99 per cent of their time in apps. The share of in-app ad spending in China was a whopping 98 per cent in Q2, five points above the global average. Meanwhile, in-app ads in China were three times more valuable than mobile web in China in Q2.

Gaming apps in particular have quickly embraced rewarded video, as the positive user experience and high engagement rates keeps audiences hooked. According to Smaato, ad spending on rewarded video in gaming apps increased +242 per cent from Q1 to Q2 2017. Rewarded video’s growth in gaming apps also outpaced non-rewarded interstitial by +74 per cent from Q1 2017 to Q2 2017, suggesting that advertisers and publishers recognise the future value of this engaging format.

“In a recent IAB survey, advertisers suggested they plan to spend more than half of their ad budgets on video this year. We are seeing this become a reality across Smaato’s platform, as mobile video is the fastest-growing segment of our business. Based on what we are seeing, we expect mobile video to continue its high growth and become the dominant medium in the years ahead,” said Ragnar Kruse, CEO and co-founder of Smaato.

In-app ad spending reached a record-high share of total mobile ad spending (94 per cent) this quarter. Advertisers’ shift to in-app drove eCPMs up 79 per cent from Q2 2016 to Q2 2017, resulting in in-app ad spaces becoming 224 per cent more valuable on average than those on mobile web.

In terms of the OS, Android owned 57 per cent of total global mobile advertising spend in Q2 on the Smaato platform, reaching 75 per cent of total unique mobile users worldwide. However, in a quarter marking the iPhone’s 10th anniversary, iOS users commanded 18 per cent higher eCPMs than Android users, and generated almost twice as much revenue for publishers on a per-user basis.

Gender data was one of the most important metrics for determining value of ad space. If an ad request contained gender data, the value of the ad space increased on average by 158 per cent. While in the minority in terms of share of total mobile ad spend, female users were 25 per cent more valuable to advertisers. In China, for example, advertisers paid 219 per cent higher eCPMs to get in front of female users.

Shubhi Tandon

Shubhi Tandon is the Assistant Editor at Digital Market Asia. Fascinated by the evolving digital media industry, she has focussed on tracking developments in the Asia Pacific market since 2014.
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