Social Video Ad Revenue Is About To Explode
New analysis shows that social ad revenue is growing at an incredible rate, and this is why.
Join us for #SMWONE May 5 - 28, 2020 and hear from 300+ speakers across 150 sessions.
New analysis of ad spending and revenue in the United States shows that ad revenue from video on social media will skyrocket in the next few years, reaching over $11 billion by the year 2020.
For reference, that means ad revenue will more than double from 2017, when revenue was just $5.68 million.
This forecast comes courtesy of eMarketer, which for the first time included social media in-feed advertising in their video ad spending figures.
How the revenue breaks down
Not surprisingly, eMarketer shows that Facebook will lead all social networks in ad revenue, and it’s not even close. Of the $11.69 billion forecasted for 2020, a whopping $10.2 billion will come from Facebook.
Next is Twitter, which will tack on an additional $743 million (up from $563 million in 2017), and then Snapchat with $724 million (but they’ll take an even more impressive leap from $334 million in 2017 to get there).
The “Other” category, which excludes YouTube—a social network that is essentially all video—will add another $18 million+ as well.
How does this compare to ad revenue on TV?
The great tension and dilemma of ad spending and revenue is whether it’s better to spend your money on digital video or television. TV ad spending is still holding strong is the high-$60 billion range at the moment.
However, according to further analysis from eMarketer, the gap between digital and TV spending is expected to shrink mightily by 2022—both because digital ad spending will continue exploding and TV spending will decrease slightly. The gap will be less than $18 billion in 2022, compared to over $40 billion in 2018.
What is sparking such a change?
Obviously the popularity of social video has been on the rise for some time. But perhaps the biggest recent change in how advertisers and marketers are viewing social video and spending is that social videos are getting longer and longer.
For years, the idea that a social video had to be short—a minute long, to fit in an Instagram post, was probably best, but certainly not more than a few minutes—was paramount.
Now, however, many social media platforms are encouraging content creators to look beyond short-form videos: From Facebook Watch, to YouTube Originals, to IGTV, social media is increasingly the home of long-form, episodic, interconnected content that is the perfect home for big ad spends.
Expect social video and social video spending to continue growing together until they overtake traditional TV and TV spending entirely.
Learn the latest trends, insights and best practices from the brightest minds in media and technology. Sign up for SMW Insider to watch full-length sessions from official Social Media Week conferences live and on-demand.
Write for Us
Interested in sharing your ideas and insights with the world? Become a SMW News contributor and reach 300k readers each month.