Summary: Many market forecasts have attempted to size the U.S. online video market, which consists of ads that are tied to a growing subset of online music sports and entertainment clips. The forecasts project the market will grow to between US$4 billion and US$7 billion by 2012. But what is the local portion of this? The popularity of online video has trickled down to the local level in the form of small and medium-sized business video advertising that accompanies local listings and business profiles. Opportunity exists in the increasing segment of video production companies targeting SMBs and growing interest among Yellow Pages publishers in adding video to their local sales bundles. Reception so far has been positive, given the general appeal of video and its simplicity when compared with other forms of online advertising (e.g., pay-per-click). This includes new advertisers that are not traditionally sold on Yellow Pages advertising. Demand for video will drive Internet Yellow Pages to execute tighter sales and fulfillment, and the medium’s favorable margins will further compel publishers to embrace it as a means to offset print revenue declines. The Kelsey Group projects that these factors will contribute to the growth of U.S. SMB video advertising from US$10.9 million in 2007 to US$1.5 billion in 2012, a compound annual growth rate of 167.8 percent.
This Advisory is one component of TKG’s four-part video forecast bundle. More information is available in the following documents:
- “U.S. Local Video Forecast: Market Projection Data”
- “ U.S. Local Video: User Data”
- “ U.S. Local Video: Vendor Profiles”
