Browse or download the case study below:

Get the slides here.

Based on a survey of more than 650 advertisers, agencies and publishers from across 31 markets, the study provides clarity on the status of adoption and buy-side and sell-side perspectives on the development of digital video and trading methods.

The research shows that nearly all stakeholders are now deploying some form of digital video advertising strategy, with over 90% of advertisers, media agencies and publishers claiming that they are using the channel.

Key findings of the report:

• Digital video is recognised as an essential brand building format as stakeholders move towards measuring brand KPIs such as brand awareness and purchase intent and away from the click. Cross-screen planning is widely practised as buyers look to unlock unique audiences across different channels and extend the reach of TV campaigns. The research highlights the importance of unique video content for different channels and devices when planning cross-screen.

• Investment in mobile video is catching up with investment in desktop digital video advertising as consumer media consumption habits evolve and advertisers aim to reach their audiences at relevant times throughout the day in a mobile always on environment. Whilst in-stream pre-roll formats are dominant in digital video advertising, the adoption of out-stream formats is coming to the fore particularly in more mature digital advertising markets such as the UK, Netherlands and Germany.

• Digital video demand exceeds supply and whilst the majority of publishers are investing in digital video it still accounts for a small yet valuable proportion of their total digital ad inventory. Publishers state that most of the inventory available is non-skippable which may require consideration in the context of user experience and ad blocking challenges.

• The future for digital video advertising looks bright as over 90% of buyers (advertisers and media agencies) cite an increase in their investment over the next 12 months. Publishers also look positive about the future and 90% expect to see an increase in their digital video advertising revenues over the next 12 months.

Alvaro Bolivar, Senior Director and Head of International Product, ONE for Publishers, AOL Platforms said: “Sound, sight and motion is the future of advertising. Video is now embedded in 80% of our original content on Huffington Post and one in three visits to the site results in at least one video view, showing that there is an appetite for both content creators and advertisers to engage with audiences through the medium, though the fact that this figure is not 100% represents an opportunity to close the gap between supply and demand in the market. Video on mobile devices is the preferred media format for millennials, and this is reflected in the 21% increase year on year in video views that we have seen on non-desktop devices.”

Oliver Gertz, Managing Director Interaction EMEA and Programmatic Lead Global Clients, MediaCom said: “As video consumption increases across digital channels, so does video advertising. Digital video can drive brand KPIs via inspiring and informing content combined with effective targeting. Integrated screen planning is important to maximise reach across all screens, from TV to mobile video.”

For more information, please contact:

Marie-Clare Puffett, IAB Europe (puffett@iabeurope.eu) 

Register to download the report below.

Two webinars have been hosted to showcase the winning case studies, the recordings can be accessed here:
Ad Effectiveness and Cross-Device
Multi-Screen Behaviour and Media Planning

The winning case studies can be downloaded below:

Brand Advertising Effectiveness: Ekstra Bladet - Pioneering datafusion leads to ground breaking results

Consumer Attitudes and Behaviour: GIK - Best for planning 2014 – 360° market media study

Mobile: Sky Media and Havas Media Group - Mobilizing the facts – using a cutting-edge method to measure the effectiveness of mobile

Video: Brand Science - Cross Screen Planning (CSP) tool

Social Media: Facebook and GfK - GfK-Facebook Data Link

Multi-Screen: United Internet Media - Multi Screen – A Peek Into The Living Room

Audience Measurement: Gemius - Behavioural Panel Synthesis™ (BPS™) - A New Horizon to Cross-Platform Measurement

Best use of Research Budget: IAB UK - Content and Native Consumer Research

What will 2023 have in store for the programmatic industry?

Nick Welch, Head of Programmatic, EMEA at IAS and Chair of IAB Europe’s Programmatic Trading Committee - As businesses look at their ad budgets with greater scrutiny in the midst of economic uncertainty, so will marketers look to extract the maximum value from their media spend in 2023. A concerning macroeconomic picture can hit budgets hard, so there will be an increased focus on solutions that maximise the balance between efficiency and outcomes whilst respecting the privacy of consumers. According to a Statista study in 2021, 46.6% of consumers ‘strongly disagreed’ with the statement that they consented to cookies. With the advancements in privacy compliant technology including contextual targeting, and an increasing interest in consumer attention, these areas will be more and more appealing for programmatic advertisers. Marketers who can understand and capitalise on the interplay between quality media, contextual and real ROI will navigate economic headwinds and even turn them into tailwinds.

Ben Geach, Consultancy Lead at Google - Through 2022, the industry has heard loud and clear that as consumers manage more & more of their life online, their expectations of privacy have also increased. The time for brands to demonstrate ‘trust’ is now & advertising must go beyond the basics and what’s legally required to exceed people’s expectations around data privacy. Into 2023, I see European brands recognising strong privacy practices build brand loyalty & make a real difference to engaging with their customer base - perhaps with the adoption of the ‘3M’ approach - meaningful (demonstrating what users get in return for sharing data), memorable (remind users what data is shared & when) & manageable (provide simple tools to manage your data).

Wayne Tassie, Group Director, Integrated Solutions, DoubleVerify - In 2023, we will see further diversification of revenue across programmatic. As budgets remain cautious due to economic uncertainty, brands and investment teams may continue to pull back from historic 'Big Tech' investment in favour of precision-based, performance enhancing, sustainable programmatic technologies and algorithms. As a result, there will be a greater focus on innovation across the industry. For instance, attention - offering insights into metrics like exposure and engagement, encompassing audibility, quartile completion, screen touches, screen real estate and more - will increasingly replace viewability. Having this intel will be crucial for brands to optimise ad campaigns moving forward. Attention metrics will make great strides next year as a mid-funnel solution that will fuel the halo effect feeding into lower-funnel programmatic attribution. Privacy regulations and the deprecation of cookies will undoubtedly accelerate the shift towards attention as the industry’s new currency. However, the shift isn’t only reactive but grows out of verification solutions. Advances in verification have improved transparency and measurement, in turn improving the baseline for media quality. Once quality has been established, measuring attention is the next step in understanding how campaigns will perform - helping to not only optimise, but protect media buys.

John Wittesaele, Global CEO at Xaxis - The advertising industry will see multichannel campaigns evolve as advertisers unlock true omnichannel capabilities. Whereas multichannel lets buyers reach consumers across screens, omnichannel strategies fill in the missing links between screens and platforms so that advertisers can purchase inventory, make in-flight optimisations, and measure performance in a unified way. This means advertisers can effectively frequency cap their campaigns across channels to reduce wastage and maximise their ad budgets, while also improving relevance for audiences. Omnichannel capabilities let advertisers fluidly adjust which channels they direct their budget towards in real time, boosting efficiency and supporting a test-and-learn mindset. Advertisers can then invest in the channel mix that best delivers against their objectives, ensuring all components of a campaign work together to exceed the sum of their parts.

Krzysztof Lis, Partnerships & Consultancy Expert, Yieldbird) - We expect further increase of demand for every non-standard ad formats, which exceed the standard, flat display ad formats. This trend is much stronger than in previous years and includes formats like "page takeover", intrusive display creatives and audio ads. In terms of transaction types, we expect that the demand for private auctions is going to decrease, and expect the campaigns to be moved to preferred and programmatic guaranteed deals, but also to the open exchange. In terms of the inventory availability, we see that more and more publishers start selling their impressions on the programmatic market and expect to generate additional revenue this way. However, due to the increased competition for the campaigns, simply being present there would not be enough, and the publishers must offer some unique, incremental value for advertisers, which is not available there.  

Amanda Cohrs, Global Head of Programmatic Consultancy, ShowHeroes - With the growing diversity of formats and solutions in Connected TV, Audio, DooH, and InGame, it is expected that composite approaches are needed to meet audience’s cross channel. Together with this omnichannel approach, it’s fundamental that technical standards and clear guidelines must be established and implemented across the board. Reaching audiences in a privacy-safe way has already brought alternative identifier solutions front and center on the adtech side, while contextual solutions are now becoming more attractive and necessary pieces to the cookieless puzzle for buyers and sellers. And last but not least, sustainability is no longer a “nice to have”. Sustainable practices are becoming interwoven in every major component of advertising and how digital media companies are evolving their business.

Ionut Ciobotaru, Chief Product Officer (co-CEO), Verve Group - If 2022 pushed horizons on consolidation and efficiency, then 2023 will be focused more on performance and holistic measurement.  We believe that publishers will be looking for more controls and ways to increase the value of their inventory through seller-defined audiences, cohorts and enhanced creative units. We're expecting privacy enabling tech to grow from the toddler stage to a child, with greater focus on what Privacy Sandbox, Interoperable Private Attribution and others have to offer, and that there will be clear winners (and losers) as it relates to efforts such as universal identifiers. Lastly, we see performance and measurement being a big opportunity for CTV to become more widely utilized. Proving its value be hooks for largest digital screen in the household to continue to gain traction.

Piper Heitzler, Head of Growth, EMEA, Amobee - Over the past 3-5 years it was easy to categorise industry players into 4 quadrants, with "Linear" and "Digital" on the X axis and "Demand" and "Supply" on the Y axis. The peak trends of 2022: SVOD --> AVOD, retail media network proliferation, seller-defined audience strategies, etc illustrate how in 2023 we will see ad tech offerings pull closer to the centrepoint of this matrix – giving buyers and sellers a one-stop shop, end-to-end ecosystem for programmatic buying. With that said, we should gear up for a major year of consolidation as large players look to buy rather than build their own end-to-end stacks focused on delivering self-serve tools to advertisers, agencies, publishers and media owners alike.

David Bauckmann, CTO, ImpressionMedia - With the growing share of CTV, DOOH and programmatic audio advertising, more and more emphasis will be placed on controlling and evaluating these channels from one place in a holistic manner.  At the same time, we expect more and more pressure to optimize the supply chain and the associated increase in all forms of programmatic deals and SPO optimization practices. Closely related to the supply chain issue is the topic of sustainability, which is sure to be highly debated in 2023. But we expect to see concrete steps in optimization more for economic reasons.

Frederic Lutt, VP Client Success, MediaMath - The year 2023 will mark a shift in a few topics that emerged in previous years: CTV buying will become more mainstream than ever in Europe. Previous years have been about building the ecosystem and the proposition on the publisher side. The entry of Netflix & Disney+, and advances from the FAST services like Samsung TV Plus will accelerate the evolution of buying behaviours from linear to connected TV. Measurement will improve. The two buying models will co-exist in 2023 and CTV will need to prove its advantages to the advertising industry. Another important topic for our industry and for the world is sustainability. All players in the programmatic advertising supply chain will need to do more to collectively achieve net zero. “Collectively” is an important word here as we all need to play our part if we want to be successful as an industry. Attention is another topic, which can be linked to sustainability and will rightly gain traction in 2023. Advertisers and their agencies will continue to focus on identity and prepare for a cookieless future. We will continue to talk about the metaverse, but I feel that it will still be too early by the end of 2023 to have a strong offering to advertise in metaverses.  In-gaming advertising will continue to evolve and pave the way for metaverse strategies.

María Ramiro, HUAWEI Ads Head of Business Development Europe - As a Technology Company with innovation as our heart, cutting- edge technologies will contribute to the development of AdTech as to expand into the whole value chain on programmatic advertising. Integrating hardware & software will continue bringing key opportunities for first party data strategies, automation, as well as a more integrated consumer personalized experiences. In an uncertain social & macroeconomic situation, Innovation & Diversification will be key for advertisers and publishers looking for cost- effective solutions.

Austin Scott, Head of Video Marketplace Development. Xandr - Exciting changes have been a staple of this year within the digital video world and I expect to see this continue through 2023. New entrants at local market level are driving the progress and digitalisation of the TV space, while disruption, led by media owners, is contributing to rapid transformations.  As consumer expectations and habits constantly evolve, the phrase ‘content is King’ could not be truer; automation and programmatic technology will become invaluable to marketers’ success.  The flexibility of digital and the number of platforms through which viewers can access content is increasing, meaning brands must work even harder to reach them.  However, the big budgets of studios and the costs of high-quality content creation is competitive. In the current economic climate, creators and viewers alike are looking at ways to cut back on costs.  As such, savvy media owners are looking to advertising as a way to generate revenue for new content and lower costs for their audience.  We are seeing big players lean into new ad supported subscription models to meet consumer demand as an effective way to make their content more accessible for all.  Next year, I anticipate the biggest shift coming through the programmatic buying of Connected TV as broadcasters and media owners lean further into this offering recognising its’ benefits of supporting effective ad targeting and frequency management across premium environments. 

Augustin Decré, Managing Director - Southern Europe, Index Exchange - Evolving economic concerns have wide-ranging implications for the future of our industry, but the good news is that there are still bright spots and significant opportunities ahead. One of the largest opportunities still lies in consumer trust, and how we’ll come together as an industry to build mechanisms allowing consumers to be confident while navigating the web. In today’s increasingly digital world, there’s an ongoing movement to give consumers more transparency and control over their personal data. We’ve seen this play out over the last decade, with rapid developments to phase out the third-party cookie. Luckily, tech platforms can move with greater speed than governments and can have a more decisive impact in innovating to solve the root issues in privacy and advertising. 2023 will be the year of action, with media owners and marketers leaning into innovation to help perfect alternative solutions and ensure the ecosystem can continue to monetise and reach new audiences no matter the screen. 

2023 buzzword prediction:

Nick Welch, Head of Programmatic, EMEA at IAS and Chair of IAB Europe’s Programmatic Trading Committee - Attention-related

Ben Geach, Consultancy Lead at Google - Privacy By Design

Wayne Tassie, Group Director, Integrated Solutions, DoubleVerify - Technogenesis; relating to the maturity of the programmatic ecosystem and the evolution of its infrastructure to accommodate emerging buying/trading models. 

John Wittesaele, Global CEO at Xaxis - Omnichannel, Fluidity, Flexibility

Krzysztof Lis, Partnerships & Consultancy Expert, Yieldbird) - CTV, DOOH, programmatic guaranteed, content to speech, vCPM, vCPV (viewable Cost-Per-View). 

Amanda Cohrs, Global Head of Programmatic Consultancy, ShowHeroes - ○ Contextual targeting. Supply path transparency. CTV. Audibility. Netflix. Omnichannel. Sustainability. SaaS. OpenPath

Ionut Ciobotaru, Chief Product Officer (co-CEO), Verve Group - Zero-party cookies. "Sustainabull"--the idea that ad-tech companies are creating sustainable efforts that are either not measurable or merely headlines for press releases. "Ad-tech immersion"--going deep to know the utilization of one's ad-tech experiences.

Piper Heitzler, Head of Growth, EMEA, Amobee - Vertical integration: owning every step of the content creation, distribution and monetisation workflow.

David Bauckmann, CTO, ImpressionMedia - Supply chain / Supply path. Sustainability. CTV. Holistic 

Frederic Lutt, VP Client Success, MediaMath - Metaverse. Sustainability & Attention. CTV

María Ramiro, HUAWEI Ads Head of Business Development Europe - On one side, some keywords that we have been hearing, will still be trending: “Quality Traffic & brand safety”, “Identity” (First Party Data, Contextual targeting, and others), “Omnichannel strategies”. On the other side, 5G, AI & Connected Devices development, that will generate new buzzwords such as “cross device advertising”, referring to the possibility to either use the data of the connected devices for a precise targeting strategy, or start delivering ads into new devices such as smartwatches, connected cars, etc. A completely new area that could be subject to pilot cases in the next.

Austin Scott, Head of Video Marketplace Development. Xandr - Carbon conscious media – sustainability is finally earning its place as top of mind, influencing the decision makers like never before.  Consumers are looking to brands to make sustainability a part of their daily lives and are consequently spending more on brands that share their values.  Since technology is one of the largest contributors to carbon emissions, it is even more critical that marketers evaluate their partners. Tech partners are going to be held accountable and an expectation for us all to be ‘carbon conscious’ will be more and more a part of our daily lives. 

Augustin Decré, Managing Director - Southern Europe, Index Exchange - Privacy, CTV, Addressability.

Sum up 2022 in one or two words: 

Nick Welch, Head of Programmatic, EMEA at IAS and Chair of IAB Europe’s Programmatic Trading Committee - Efficiencies and Outcomes

Ben Geach, Consultancy Lead at Google - Innovation through change.

Wayne Tassie, Group Director, Integrated Solutions, DoubleVerify - A mixed-bag.

John Wittesaele, Global CEO at Xaxis - You’re on Mute (Still).

Krzysztof Lis, Partnerships & Consultancy Expert, Yieldbird) - Unpredictability (the war in Ukraine caused a huge increase of impressions, but some advertisers wanted to exclude content related to the war, on the other hand, a lot of publishers wanted to cease cooperation with advertisers that support Russia, also some demand providers wanted to cease cooperation with publishers from Russia). 

Amanda Cohrs, Global Head of Programmatic Consultancy, ShowHeroes - Gaining momentum.

Ionut Ciobotaru, Chief Product Officer (co-CEO), Verve Group - Privacy (Re) Redefined

Piper Heitzler, Head of Growth, EMEA, Amobee - "In-person". It's been great to get everyone out of their homes and back to the office, industry events and live meetings.

Frederic Lutt, VP Client Success, MediaMath - New Reality.

María Ramiro, HUAWEI Ads Head of Business Development Europe - Saturation & Diversification.

Austin Scott, Head of Video Marketplace Development. Xandr - “What a ride!” 2022 was a great year for programmatic as the kinetic energy that had been building up all through 2020/2021 came into the mainstream. Programmers and broadcasters launched private marketplaces, FAST apps and new digital offerings focused on automation. However, emerging from a pandemic and with current world events having such huge impacts on consumers' lives, from ongoing situations in Ukraine and Iran to the cost of living crisis, we need to adapt our focus to keep pace with what’s important for the end consumer. Amidst financial uncertainty, advertisers will need to consider more than just basic sales figures as measurement for success. For the first year ‘post-pandemic’ we had a lot to do, but really the changes have only just begun and I’m curious to see what innovation and long-standing transformation comes out of this as a result.  One thing is certain though, the TV revolution will be televised.

Augustin Decré, Managing Director - Southern Europe, Index Exchange - Innovation - economic uncertainty, will drive new thinking and further developments in our industry

First published in Video Ad News, our chief economist Daniel Knapp broke down the key trends and changes taking place in video advertising across Europe.

6 August 2019, Video Advertising Grows Three Times Faster Than Display in Europe

The overall takeaway from this year’s report, which covers market trends in 2018, is that Europe’s digital advertising industry – aggregate – has continued to grow rapidly. Last year, gross digital advertising expenditure in Europe totalled €55.1 billion, up 13.9 percent from €48.4 billion in 2017. This represents a slight acceleration in growth on recent years and is the highest growth rate since 2011.

Growth in the video display market

For video advertising expenditure, including in-stream, out-stream and in-feed advertising, the acceleration in growth from 2017 to 2018 was even more pronounced than in the market as a whole, and increased its share of the total display market from 12.1 percent to 13.9 percent.

The total display market, helped by video, gained 1.3 percentage points of share. In fact, display growth was concentrated on video in 2018, with the format seeing growth of 30.9 percent, nearly three times faster than the rest of the display category.

Thanks to this growth, video now accounts for one third (32.8 percent) of total display expenditure across Europe. This is in keeping with the trend of the past five years, whereby video has been the main growth driver for the display market. Attracting brand budgets, with limited inventory available, video has historically been a sellers’ market with stable and high CPMs. Further drivers for growth include a wide array of factors from consumers accessing more content on mobile devices to an increase in inventory –  particularly from social platforms – to programmatically traded video, and a growing influx of brand advertising spend.

Local market trends

When it comes to which nations are driving digital video advertising spend, Western European countries dominate, led by the UK, France, Italy and Germany. Russia is the only non-Western European country to make the top five. However, with a few exceptions, Eastern European nations generally have much faster growth rates than those in the West.

In terms of digital video’s share of display ad spend by market (an indicator of the maturity of video advertising in each country) some Central and Eastern European markets are outperforming their West European peers. For example, at 41.6 percent, Ukraine’s video market appears to be more mature than all other European markets with the exception of the UK (43.9 percent).

In-stream vs. out-stream: a changing dynamic

Over recent years, the structure of the European digital video advertising market has been changing. Once dominated by in-stream video – be it broadcaster video, YouTube, or pre- mid and post-rolls against editorial content – the scarcity of inventory, paired with advertiser demand and the requirement for publishers to increase digital monetisation has rebalanced the market in favour of out-stream (incl. in-feed) video. In fact, out-stream is now nearly on par with in-stream with 49.4 percent market share vs. 50.6 percent.

As social platforms heavily ramped up their video play, in-feed as a subset of out-stream video is a key market driver. Out-stream grew 2.3 times faster than in-stream in 2018.

Where next?

We expect the video category to continue to expand, blurring traditional boundaries to TV advertising. Connected TV will no doubt grow in importance – but it is worth noting that while connected TV is exploding in the US, the market is much more fragmented and localised in Europe. However, standards like HbbTV offer a path for scaled growth, and local market initiatives to drive standards, measurements and technology will help bring the worlds of video and TV further together.

First published in MARTECHSERIES, the Marketing Technologist Insights publication, IAB Europe share some commentary about the growth figures released in 2018 and cast predictions and rationale for 2019 stats.

31 July 2019, The European Digital Advertising Market Continues on Its Growth Trajectory

This July, IAB Europe published the latest edition of its AdEx Benchmark report, which provides facts and figures about the health of the region’s Digital Advertising market in 2018. Since 2008, the study has mapped a trend of sustained double-digit growth. However, as 2018 got underway it was far from certain this trend would continue.

Indeed, for the first half of the year, the market showed all the signs of a slowdown. At that point, based on local market signals, we were forecasting that total growth for the year would be 12% on an annual basis – somewhat lower than had been achieved in 2017. This dip in activity in part relates to the introduction of the EU’s General Data Protection Regulation (GDPR), which came into force on the 15th of May. Uncertainty over how GDPR would play out meant that media buyers temporarily put the budget on hold while they took stock of the situation.

The market bounces back

This period of uncertainty is unsurprising and as you would expect in the context of such a game-changing regulation. What was unexpected, however, is just how quickly the market rebounded. The final figures for 2018 show that the Digital Advertising industry in Europe grew by 13.9% – the fastest growth rate the sector has experienced since 2011. Significantly, growth is reflected across all European markets; suggesting that Europe represents a common advertising market fuelled by similar growth drivers.

In financial terms, the European advertising market grew from €48.4 billion in 2017 to €55.1 billion last year. This increase suggests continued demand for Digital Advertising and at least partial adaptation to regulatory challenges. However, we expect that the full impact of GDPR won’t be realized until this year or next.

Overall, despite fundamental structural changes in the market over the past years, growth has been consistent since 2011 – varying only by a maximum of 2.4 percentage points. The growth drivers were the ‘usual suspects’: video, mobile, social, and programmatic. However, while in 2017 the market was flat once social was factored out, growth excluding social picked up in 2018. This suggests that amidst flat and declining parts of the industry, there are new pockets of growth.

A more diverse future

We expect growth to remain double-digit in 2019, but to slow down slightly to approximately 11% year-on-year. Sources of growth are diversifying as digital out-of-home becomes connected to the programmatic ecosystem and audio achieves scale through standardization, partnerships and an explosion in monetizable inventory. However, this growth is coming from a low base. It will take another five years before it can make a significant contribution to the overall spend.

In programmatic, a renewed focus on private marketplaces by media buyers highlights a growing realization that audience-based buying still needs context. This presents an opportunity for premium editorial environments. We also see a new generation of programmatic services built on top of the available infrastructure. Services like supply path optimization (SPO) provide new tools to spot inefficiencies and optimize the supply path, and dynamic creative solutions will deliver new use cases for a programmatic infrastructure.

Blurring boundaries between AdTech and MarTech enable new ways of activating companies’ customer base and first-party data. Today, organizations are increasingly looking to embrace metrics and KPIs that are outcome-oriented, and they increasingly want to move beyond proxy metrics for campaign success and measure media investment as close to business metrics as possible. The marriage of AdTech and MarTech provides a path for this.

At the same time, a new sense of ‘data realism’ is developing among some of the savviest brands. These organizations understand that data can’t solve everything and not all that can be measured and quantified matters. These brands eschew short-term metrics and the performance notion of advertising in favor of creative or design-led approaches. For some, this entails moving emphasis from paid media to experience design, such as app development, customer care, logistics, and other consumer-centric features.

Connected TV also has potential, and it continues to be a hot topic. However, the landscape is much more localized and fragmented in Europe than in the US, where a lot of the growth narrative comes from. More standardization and collaboration between market participants is required if it is to live up to its full promise.

First published for PerformanceIN, The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe shares a broad market overview of the study's key findings with a detailed focus on the search results, across mobile and desktop.

29 July 2019, The European Paid-For Search Market: Stable Growth, but Structural Transformation Ahead

The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe shares a broad market overview of the study's key findings with a detailed focus on the search results, across mobile and desktop.

Every year, the IAB Europe, a European-level industry association for the digital advertising and marketing ecosystem, publishes its AdEx Benchmark report. The report outlines the performance of the European digital advertising market and breaks down growth figures by both format and region. This July, IAB Europe released the latest edition of the study, which covers performance over 2018.

Looking first at Europe’s overall digital advertising sector, the story that emerges from the report is one of sustained growth. By the end of 2018, the total market had grown to €55.1 billion from €48.4 billion in 2017, an increase of 13.9% and the fastest the market has grown since 2011. From 2012 to 2018 the market has more than doubled in size driven largely by increasing advertising investments in social, mobile and video formats. Overall, since the first AdEx Benchmark study in 2006, the market added some €48.5 billion in annual value.

Figure 2: total digital ad spend growth

Paid-for search shows economic resilience

For some years now, paid-for search has been an important growth driver. In 2009, for example, it was the only medium in Europe not to fall into decline as a result of the recession, largely due to its ability to measure and pay by performance.

This resilience has been highlighted by ten years of like for like growth figures in the category. Indeed, of all the advertising formats that IAB Europe tracks in its AdEx Benchmark study, paid-for search has maintained the strongest growth rates in periods of economic uncertainty. Where other marketing spend gets cut when times are tough, the pay-by-performance model allows marketers stricter budget controls, and low entry costs enable tactical marketing interventions.

Growth is unevenly distributed

In 2018, despite the maturity of the format, growth in paid-for search continued in double-digit figures (12.5%) enabling it to maintain its total share of the European digital advertising market at 45%.

However, this growth was not spread evenly across Europe. At the top end, the paid-for search market in Belarus grew by 37.5% while at the bottom end, Belgium’s market grew by 1.9%. The top six markets in terms of growth are located in Central and Eastern Europe, while Finland (20.7%), Ireland (16.7%) Norway (15.9%) and Sweden (14.5%) are among the fastest-growing search markets in Western Europe.

Nordic markets have a strong local history of directories spend, which delayed the proliferation of the paid-for search market in the mid and late 2000s. The higher growth rates in the region are due to those historical reasons. The UK is the largest paid-for search market in Europe and still grew above the European average (14.3%).

Figure 33: paid-for search growth in 2018

The contribution of mobile search

One of the reasons that the paid-for search market is seeing strong growth is because prices for mobile search are beginning to catch up with desktop search prices. While the share of mobile searches is still roughly 10% higher than the share of mobile ad spend, the gap is shrinking. What’s more, mobile search has benefitted from an increase in mobile search volumes overall, helped by better integration with maps and changing consumer habits.

Figure 35: mobile search ad spend and growth

As a result, in 2018 mobile search grew by 28.6% to €11.6 billion and increased its share of the total search market by 5.8 percentage points. Once again, the growth leaders are Central and Eastern European nations such as the Czech Republic (70.6%), Belarus (54.4%), Ukraine (44%) and Slovenia (43.8%). Norway (35%) is the fastest-growing Western European market. The UK, which is by far the largest mobile search market (worth €4,646 million compared to the €1,313 million generated by Germany, the second-largest market) is growing in line with the European average.

Additionally, eight markets can now be considered mobile-first, in that their mobile share of search exceeds 50%. Five markets have a mobile share larger than 60%: Serbia, Ukraine, Russia, Turkey and Ireland.

Figure 37: mobile share of paid-for ad spend by market in 2018

Outlook: the changing nature of search

The nature of search itself is transforming. One of the biggest changes is the rise of Amazon, which is becoming a default destination for product-related searches. Mobile, and in particular app-based media consumption, are leading to a further verticalisation of the search market. Verticalisation means that consumers conduct search in specific functional apps - such as travel or entertainment - not all of which is paid for. At the same time, new opportunities to monetise mobile search arise, in particular through maps and in-car integrations.

Often, voice is highlighted as the next generation of search. Yet there still is a lack of systematic evidence that consumers are adopting voice to conduct diverse, and more complex search queries beyond daily, habitual tasks (checking the weather, for example). Monetising voice search also remains a challenge, both from a product and a privacy perspective.

In sum, these observations suggest that the future of search is defined by a more diverse set of factors than before. This will change how we define, buy and use paid-for search.

First published in Mobile Marketing Magazine, The AdEx Benchmark report author, Dr Daniel Knapp, chief economist at IAB Europe provides insight into the state of the European mobile advertising market on the back of the report.

25 July, 2019, Mobile continues to drive growth in European digital advertising

This July, IAB Europe published the latest edition of its annual AdEx Benchmark report on the state of the European digital advertising market. The report, which focuses on market performance over 2018, brings together facts and figures from across Europe relating to growth, and delivers a breakdown of spend across digital advertising formats.

The top-line figures for the overall market show that the entire European digital advertising sector grew by 13.9 per cent in 2018, which represents the fastest growth in the sector since 2011. Digital remains a significant driver for growth in the overall paid-media advertising market and now accounts for 45 per cent of the total. Between inception of the AdEx Benchmark study in 2006 and this year’s index, the market added €48.5bn in annual value.

Mobile increases market share of display
Where does mobile advertising fit into this picture? Mobile advertising first made a truly significant impact on the digital advertising market back in 2013, when it accounted for a double-digit share of digital spend for the first time. By 2017, mobile was one of the key drivers behind growth in display spend.

In 2018, mobile continued to drive growth. Overall, mobile display advertising spend grew by 34.2% to reach €11.4bn. This growth means that mobile accounted for 48.9 per cent of total spend in display advertising.

The strong performance of mobile display is in contrast to desktop display, whose share dropped to 51.1 per cent in 2018 from 57.2 per cent in 2017.

The growth of mobile display is largely due to the continued proliferation of social media and improved targeting options. The growth in optimised mobile pages from publishers has also played a part, as has the use of ad campaigns to drive app installs. Gaming apps were a particularly strong driver for growth in mobile display and we saw large gains recorded by app developers in this space.

Looking at the regional breakdown, the growth leaders are mostly emerging markets such as the Czech Republic (105 per cent) and Ukraine (65 per cent). However, Germany also demonstrated a surge in mobile display growth, coming second in the rankings at 65.4 per cent. Overall, mobile display spend is dominated by Western European countries, particularly the UK, which accounts for €4,759m of the total (almost four times as much as the second biggest spender, Italy, which accounted for €1,051m). Of note is the fact that 13 markets are now mobile-first (i.e. the share of spend on mobile exceeds that of desktop).

Mobile search spend trends upwards
Mobile also performed well in the search space, growing 28.6 per cent in the year to total €11.6bn. This represents an increase of market share of 5.8 per cent on 2017 (40.5 per cent vs. 46.3 per cent), bringing it closer to spend on desktop search. While this is a lower share of the market than in mobile display, it accounts for €0.2bn more in actual spend due to the larger size of the market.

Higher ad rates were a driver of growth in this market. This is significant because historically rates for mobile search have lagged those for desktop. And while the share of mobile spend still trails the share of mobile searches by around 10 per cent, the gap is closing. Mobile search also benefited from higher mobile search volumes overall, helped by better integration with maps and changing consumer habits.

In this category, nine of the ten largest markets are in Western Europe (with the exception of Russia, which ranks fourth). The fastest-growing markets are once again in Eastern Europe, with the Czech Republic (70.6 per cent), Belarus (54.4 per cent) and Ukraine (44 per cent) leading the pack. Eight markets are now mobile-first (i.e. where spend on mobile has overtaken desktop), with the top ten in terms of mobile share coming from a mix of Western and Eastern European nations.

Across all formats, mobile ad spend is still catching up to changed media consumption habits, especially outside of the social platforms. As the social share of digital ad spend begins to plateau, this is where new pockets of growth are emerging. The ascent of digital audio advertising around music streaming and podcasts, is also predominantly mobile. This will be further fuelled by the proliferation of connected cars in the years ahead.

IAB Europe’s Economic Trends Forum offers market analysis and industry insights for our corporate members and network of National IABs. Every 8 weeks, a webinar or face to face event will be hosted. Free for members to attend, each forum will focus on a different industry topic with a detailed analysis of the marketplace. 

The next Economic Trends Forum focus on digital audio advertising will take place on 18 September in Paris - registrations will open shortly.

If you are a member, please log in and click below to watch the recording and download the deck:

AdEx Benchmark is the definitive guide to the state of the European digital advertising market.  The report reveals the key milestones contributing to the 2018 market value of €55bn and the fastest growth since 2011.

The report provides a comprehensive perspective of digital advertising spend across Europe which is essential in benchmarking market development trends, the increasingly pan-regional nature of digital advertising investments and the role of Europe’s digital economy in a global context, attracting global start-up funding and European policy formulation.

Based on a study of twenty-eight markets in Europe, the report includes data on social ad spend and splits video by in-stream and out-stream. Out-stream video and mobile both dominated results in 2018, as they both grew by double-digits in all twenty-eight markets. Out-stream video grew by 44.7 percent on average, compared to in-stream at 19.7 percent. Overall, video grew by 30.9 percent, to €7.6bn, accounting for 33 percent of the display market.

The results and trends highlighted in the AdEx Benchmark Report will be discussed in our first Economic Trends Forum webinar on 25th July at 15.00 CEST / 14.00 BST. Find out more about the IAB Europe Economic Trends Forum here. 

You can download the full report below

The study asked respondents about advertising in radio, podcast and streamed environments, drivers and barriers to programmatic audio investment, stakeholder knowledge of programmatic audio and the metrics used to evaluate programmatic audio campaigns.

John Wittesaele, EMEA President at Xaxis, says: “We’re buoyed by the confidence that buy-side stakeholders will very likely plan to increase programmatic audio spend in the near future, although there is work to be done to educate.”

IAB Europe’s Chief Economist, Daniel Knapp, agrees that “Programmatic audio is still at a nascent stage but growing quickly. Innovative European companies, both those with a history in radio and online streaming, are helping to drive growth.”

Download the full report below:

The AdEx Benchmark study is the definitive guide to the state of the European digital advertising market, covering 28 markets, and is now in its thirteenth year. In 2018, a total of twenty-one markets saw double-digit year-on-year growth.

Access the study below.