According to new research from WARC, which provides insights on advertising and media effectiveness, by 2023, advertisers will spend $46.6 billion on AVOD, almost double the current investment level.
However, the AVOD base is still small in comparison with the global ad market; the $23.8 billion in current investment is just 5.2 percent of the worldwide ad pie. But AVOD growth is outpacing other paid media, driven by gains in the U.S. and China.
China is projected to become the world’s largest AVOD market this year, with $8 billion in ad spending, one-third of the global total and just ahead of $7.9 billion in the U.S.
“Consumers’ voracious appetite for video content anywhere, on any device, has been propelled by SVOD services such as Netflix,” said James McDonald, data editor at WARC. “But it is AVOD platforms which present the opportunity for advertisers to marry rich consumer data with pinpoint targeting during engaging content. This is why AT&T and Amazon are exploring moves into the AVOD sector next year, with the ultimate aim of taking the lion’s share of a market expected to be worth $47 billion by 2023.”