Online Video Advertising Growth in Russia: 2016 Achievements and 2017 Outlook
IMHO Vi, a prominent online advertising seller, has projected a substantial 18% growth in online video advertising by the end of 2016. Ilia Alekseev, the General Director of Digital Seller, shared this information. For further insights on the evaluation of online video advertising by Russian market experts, refer to the Quarter Billion Agency Group blog.
Summarizing the first half of the year, experts highlighted a remarkable 24% growth compared to the same period in 2015, with online video advertising revenues rising from 2.1 to 2.6 billion rubles. Ilia Alekseev attributed this achievement to a phenomenal second quarter. However, the growth dynamics were not as strong in the second half of the year due to the substantial base established in the second half of 2015.
According to IMHO Vi’s estimations, online video advertising experienced a 14% growth in the second half of 2016, resulting in an overall 18% growth for the entire year. Advertisements in the form of videos on the internet increased from 5.3 to 6.25 billion rubles. Interestingly, these results closely aligned with the predictions made in the previous year’s expert poll, which anticipated a 19% growth in online video advertising for 2016.
Within the online video advertising segment, the FMCG category retained its leading position among advertisers, commanding a significant 52% share. Lubov Yachkova, the Head of IMHO Vi’s Video Advertising Department, explained that “Cosmetics, perfumes, and personal hygiene brands accounted for the highest advertising expenditure.”
Pharmaceuticals followed with a 19% share, while car brands accounted for 8% of the market. Yachkova noted that both these segments experienced more than a 50% increase compared to the previous year. Telecommunication operators held a 6% share, followed by the retail sector with 4%, while the remaining 11% was attributed to other categories of advertisers.
According to IMHO Vi, the second half of the year also witnessed significant growth in advertising campaigns targeting specific social-demographic parameters, accounting for 75% of such campaigns. The majority of these campaigns (around 60%) were aimed at women between the ages of 18 and 45, while only 5% targeted the male audience. Yachkova suggested that this gender disparity could result in higher costs for campaigns targeting women compared to those targeting men. She further stated that even now, the price of a rating point on female-oriented channels is 25-30% more expensive than on male-oriented channels.
IMHO Vi’s forecast for 2017 indicates that video advertising on the Russian Internet (Runet), specifically in-stream video inventory such as video services and online cinema, could experience a further growth of 15-20%. However, the forecast does not include out-stream video advertising found on social media and content sites. Ilia Alekseev, the General Director of IMHO Vi, stated that the measurement of out-stream advertising is limited, and they lack data on the allocated ad budgets for this segment. As a result, if the out-stream market continues to evolve, the overall growth dynamics could be even higher.
It’s important to note that the Russian Association for Electronic Communications (RAEC) previously conducted research on video advertising on the Internet as part of its Russian Internet Economy analysis of the online advertising market. According to their findings, video advertising on the Internet experienced a 23.6% growth, reaching 5.5 billion rubles in 2016. The research also predicted a 26% growth, totaling 6.93 billion rubles, for 2017. The study highlighted that video advertising holds a significant share within the media Internet advertising sector and demonstrates consistent growth across the entire media segment.
Based on the findings of advertising market research conducted by Russian experts, it is evident that online video advertising experienced growth in 2016 and is expected to continue its upward trajectory in 2017. The experts at Quarter Billion Agency Group diligently track all trends within the Russian advertising market and are readily available to provide consultations on any matters concerning promotion in Russia.