Q&A: How the IAB is reimagining the future of digital viewership

In analyzing the future of the media landscape, the Interactive Advertising Bureau (IAB) is reimagining the future of digital viewership. We sat down with the IAB's Eric John, vice president, media center, to discuss continuous growth in video advertising and connected TV (CTV), why the old model of a million-dollar TV commercial playing once everywhere is gone, and how to make creative work better.

eMarketer: What brands are looking for isn't really changing. Could you talk about some of the major shifts within the past two years and how they will impact the season?

Eric John: Over the past two years, we've seen a massive shift in viewership. Digital media became everyone's safe haven as everyone was trying to understand what a global pandemic really meant for them. Video benefited from a massive increase of streaming behavior, but that shift also really put pressure on brands and buyers to understand how and where to reach their audiences.

So what changed was, if you are a brand and you are in a vertical like autos, it might be that your message had to instantly pivot to the showroom and see the latest models. When our service centers are open, or if you are a quick-serve restaurant, it might be that order in advance and pick up outside of the restaurant. That practice over the past two years has fundamentally shifted the speed, nimbleness, and table stakes that are now for managing media in a real-time fashion, and in a more consumer-centric fashion.

eMarketer: What are some of the challenges that you're hearing from members around the Upfronts this year, and potentially within the past two years, when they were forced to be a bit more nimble and flexible?

EJ: Buyers and sellers together had to be more flexible, right? As we said, the brands themselves were forced to change their messaging, the reserve-based buying due to supply chain issues, but we also saw the reignition of spend in particular regions, in particular places. So that's the flexibility that really came to the front in terms of the buying and transactional model. It also pointed out things that we can improve on as an industry, and this is what some of the research that we'll be sharing at the NewFronts this year is. The rinse, wash, repeat cycle of planning, executing, and optimizing, it's been rewritten, accelerated by the pandemic, but now increasingly enabled by CTV.

Creative is going to have to do much more of the heavy lifting for effectiveness in advertising. And so there's going to be a lot of focus on how to make creative work better. The old model of a million-dollar TV commercial playing once everywhere has got to end, and advertisers and brands need to think about multivariate creative and CTV and doing the basics of digital media.

eMarketer: You have your video ad spend report coming out soon. What are some of the main industry trends that you found in the report?

EJ: Ad spend and digital video increased 49% year over year last year to $39 billion and [are] expected to increase by an additional 26% this year to $49.2 billion. CTV is going to account for a lot of that spend. And what's interesting is between 2020 and 2022, CTV ad spend is expected to more than double [to] 118%.

The numbers that we saw in CTV spend really point to the need, opportunity, and growth in CTV advertising.

Our research shows that CTV is a must-buy for three-quarters of video buyers, but ad spending in CTV still only accounts for 18% of the total video ad market, defined as CTV plus linear plus other digital video. So if you consider the $65 billion TV industry that eMarketer has talked about and recognized, and eventually all TV advertising will be streamed, the 39% growth that we expect from $15.2 billion to $21.2 billion in 2022, it's great growth, but we're still in the first inning in that massive shift of spend that'll ultimately become as all television is streamed. It will become that $65 billion number.

This interview was conducted on April 19, 2022.

To read the full interview, please download "Industry Insights: Upfronts and NewFronts." Download Now.