Audience for Online Video Growing Rapidly

66% of Those Web Viewers Also Watch the Ads

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NEW YORK (AdAge.com) -- Although the number of consumers watching video online routinely is low, that number is growing, and those consumers are engaged with video advertising, according to a new study by the Online Publishers Association and Frank N. Magid Associates.

Video news clips are the biggest draw. Some 27% of viewers watch news clips at least once a week.
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According to the study, 5% are viewing video daily, 24% view it once a week and 46% are watching once a month. Video news clips are the biggest draw. Some 27% of viewers watch news clips at least once a week, followed closely by 26% who watch funny videos at least once a week.

"You will see the volume of use rise as more content is made available," said Pam Horan, VP-marketing and membership at OPA.

High advertiser demand
Even though advertiser demand is high for a medium that reflects the emotional appeal of TV ads, many consumers are still not aware of video online.

Media buyers note that until consumers are viewing video as often as they do other content, planners cannot be certain how much of their marketing budgets to set aside for video. The video arena is so volatile that estimates of video ad spending ranges dramatically from study to study, with one projecting spending of $657 million in 2009, and another study projecting $2.5 billion in 2010.

It's a rich environment for advertisers, the study found, with online video advertising being viewed regularly and leading to specific actions. Of the U.S. online population, 66% percent have seen an online video ad, and 29% have acted on what they've seen. Visiting a Web site is the action that ranks highest at 31%, while 8% are actually driven to make a purchase. Video ad watchers generally prefer short ads, but 39% said they watch ads lasting longer than 30 seconds.

Home viewing vs. work
At home, 39% watch online video at least once a week, compared with 19% who watch at least once a week at work.

Because there is yet no reliable or well-known video search engine, half of consumers go to a specific Web site to find clips, with a majority (58%) relying on two to five sites. Another popular way to find video is the way everyone found anything online in the Internet's early days -- surfing the Web -- according to almost 48% of video viewers.

The research was conducted in February. Researchers interviewed 1,241 Internet users representative of the U.S. population, aged 12 to 64.

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