This story was delivered to BI Intelligence "Digital Media Briefing" subscribers. To learn more and subscribe, please click here. TrueView ads on YouTube allow advertisers to only pay for ads that are watched to completion. Users have the option to skip these ads after five seconds of viewing, and a new study by LaunchLeap found that 59% of millennials opt for skipping. Although the metric may sound discouraging, it’s actually a good thing for users, advertisers and YouTube. Those who skip ads are likely uninterested from the outset, and an option to skip provides for a user-friendly experience while ensuring advertiser dollars are spent on those who are arguably more engaged. In addition, 29% of millennials indicated that they watch video ads to completion, which is reportedly better engagement than Snapchat, where users watch only three seconds of a video ad, according to Ad Age. Here are a few implications of ad-skipping on YouTube: Consumers continue to increase their time spent consuming digital media, while advertisers continue to increase their ad budgets into digital channels. The influx is not expected to let up in the near future. The US digital advertising industry will continue to experience remarkable growth through 2021 to reach nearly $100 billion in annual revenue, driven primarily by the sustained migration of ad dollars from traditional TV to digital video and the continued increase of social spending. Overall, the strong growth of the US digital ad market can largely be attributed to increased time spent by consumers on digital media and brands' increased comfort with allocating budgets to digital formats, particularly on digital video. In a recent 2016 survey of almost 400 US ad agencies and marketers, the IAB found that two-thirds of respondents plan on increasing spending on digital video in the next year. Moreover, mobile will become the top destination for digital ad spending as advertisers continue to attempt to resolve the disconnect between the rapid growth in time spent on phones and tablets and the relatively small share of ad budgets that are allocated to such platforms — known as the mobile opportunity gap. In fact, mobile is set to eclipse desktop ad spend by 2018. Dylan Mortensen, senior research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on U.S. digital media ad revenue that forecasts revenue trends over the next five years and outlines the key growth drivers for overall digital ad revenue in the U.S. Here are some key points from the report: In full, the report: To get your copy of this invaluable guide, choose one of the following two options: The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of digital media ad revenue.
A new study by LaunchLeap found that 59% of millennials skip YouTube ads after the five seconds of required viewing, however, 29% of millennials indicated that they watch video ads to completion which Ad Age suggests compares favourably to Snapchat's three-seconds of engagement. It is argued that TrueView ads on YouTube, which allows advertisers to pay only for ads watched to completion, enables ad spend to be targeted toward those who are likely to be more engaged. Advertisers need to make an impact in the first few seconds and convey a memorable marketing message to entice viewers to watch the entire ad.