Frost & Sullivan: Online video ads leading the way in Australian advertising market

The online advertising market in Australia grew 21 percent from June 2011 to June 2012 and is expected to keep growing at an average rate of 14 percent until 2017, Frost & Sullivan research has revealed. Those gains, however, are dwarfed by online video advertising, which grew 58 percent during the same time period and is expected to grow at a 39 percent clip until 2017.

At $86 million in 2012, online video advertising is only a fraction of online advertising as a whole, which reached $768 million. On the other hand, Frost & Sullivan predicts the online video share of the general market will "increase from 11 percent in 2012 to 30 percent in 2017" and will outperform "all other major online general advertising segments" including online display, advertorials, integrated site content and sponsorships and EDM/e-newsletters, a Frost & Sullivan news release said.

All online advertising is getting its money from funds that used to be spent on traditional media advertising like newspapers, print directories, direct mail, TV and radio, which "indicates that the migration from offline to online channels is a significant factor in the growth of the online advertising market," said Phil Harpur, senior research manager, Australia and New Zealand ICT Practice for Frost & Sullivan.

Harpur also pointed to the increasing popularity of social media as an advertising medium.

"Facebook has seen strong growth in advertising revenues and the proportion of Australian companies choosing to advertise on Facebook is growing strongly," he said.

The growth of online advertising is even swamping Australian mobile carriers as they explore advertising as a revenue stream, he continued.

"The mobile content market is becoming much more fragmented," Harpur said. "With the addition of apps in the ecosystem there is a broader array of content options available, especially in the social media and gaming space."

For more:
- Frost & Sullivan issued this news release

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