CyberAgent Surveys the Japanese Market of Video Ads
The scale of the video ad market is estimated to be 84.2 billion yen in 2016, indicating a y/y growth rate of 157%. The demand for video ads for smartphones is projected to grow about two times from the previous year, occupying about 70% of the video ad market. It is forecasted that the scale of the video ad market will reach 291.8 billion yen in 2022, and video ads for smartphones will occupy 84% of the market.
Online Video Reseach*1, which is a research institute specializing in video ads that is operated by CyberAgent, Inc. (Head office: Shibuya-ku, Tokyo; President: Susumu Fujita; listed in the first section of Tokyo Stock Exchange; Stock Code: 4751), has surveyed the trend of he Japanese video ad market in cooperation with Digital InFact, Inc. (Head office: Bunkyo-ku, Tokyo; president: Tomoyuki Noshita).
Through this survey, the annual amount of posted video ads that are distributed via the Internet was estimated and the market scale was forecasted*2. The survey results are as follows.
Background of the video ad market in 2016
Users who view online videos rapidly increased due to the proliferation of smartphones and social media. Furthermore, videos are increasingly utilized for online communication. For example, users use video contents they produced casually with a smartphone or the like as information communication tools for communities in the social media, etc.
In addition, efforts to promote the production of videos can also be seen mainly in social media and informative websites, and the importance of videos in communication activities through the Internet between the media and users is becoming more significant. Amid the changes in the trend of users and the media environment, the demand for video utilization in corporate marketing is growing.
As the main form of media for the young generation in their teens and 20’s is shifting from television to smartphones and other devices accessible to the Internet, video ads which had been used for a complementary role in commercial marketing promotion, has become an important part of promotion, and a broader range of advertisers are beginning to use video ads.
With this background, the video ad market continued to grow at a high level in 2016 as well, while playing a role of energizing growth in the Internet ad market in recent years. Companies in this industry have developed and provided advertising services equipped with new features and technology, and it has further stimulated the market.
 Forecast of the video ad market
The scale of the video ad market is estimated to be 84.2 billion yen in 2016, indicating a y/y growth rate of 157%.
The demand for video ads for smartphones is projected to grow about two times from the previous year, occupying about 70% of the video ad market.
It is forecasted that the scale of the video ad market will reach 291.8 billion yen in 2022, and video ads for smartphones will occupy 84% of the market.
An increasing number of users view videos via the terminals of smartphones. From 2015 to 2016, video content services on social media increased at a rapid pace, giving a further boost to the shift to smartphones for viewing videos.
Moreover, an increasing number of advertisers demand video ad services for not only developing the brands of their products and services, but also promoting direct responses, such as the installation of smartphone apps and the purchase of products and services.
In these circumstances, the scale of the video ad market in 2016 is estimated to reach 84.2 billion yen, showing a 157% year-on-year increase. In addition, the demand for video ads for smartphones, which has driven the growth, is projected to grow to 57.6 billion yen, about two times from the previous year, occupying 70% of the entire video ad market.
In the mid to long term, the increase of the smartphone video ad demand will lead to market growth, and it is forecasted to reach 230.9 billion yen in 2020, and 291.8 billion yen in 2022.
 Forecast of the video ad market
The scale of instream ads kept occupying over half of the video ad market and grew to 43.9 billion yen in 2016.
The main trend will not change, but the scale of rapidly growing in-feed ads is forecasted to increase about 2.5 times year on year to 19.7 billion yen.
It is projected to grow over 5 times to 101.8 billion yen in 2022.
The demand for video ads, which had been concentrated in major video streaming sites till several years ago, is being decentralized, because the options for advertisers increased as new services were introduced, assuming the viewing with smartphones and social media.
In 2016, the scale of instream ads grew to 43.9 billion yen, occupying 52% of the entire market of video ads, and the main trend did not change, but the demand for the ad service called “outstream ad,” which combines in-feed and in-banner ads, grew steeply.
Especially, as the ad formats that do not degrade the experience of smartphone users have been distributed, the demand for in-feed ads is growing considerably. In 2016, it is estimated to increase about 2.5 times year on year to 19.7 billion yen. In 2022, it is projected to grow over 5 times to 101.8 billion yen.
Future outlook for the video ad market
As video ads are becoming more advanced, the influence of video ads in the Internet ad market is growing year by year. We are required to offer ad experience through which the trusting relationships between users and advertisers are fostered through the sound communication between users and products or services, develop and diffuse an unified indicator of ad effects.
If such efforts are made in the entire industry, the video ad market will keep growing considerably.
In order to keep contributing to the growth of the video ad market, our company will strive to solve problems with corporate promotions and improve ad effects.
*1: Online Video Research: our company’s specialized organization that conducts surveys for the purpose of contributing to the development of the video ad market
*2: This survey was carried out with reference to the results of interviews with enterprises in the video ad field, publicly available information, data held by the surveying body and Seed Planning, etc. The market scale was calculated from the ad expenses paid by advertisers.
The definitions of video ads and service categories in this survey are as follows:
・Video ad: an advertisement service offered combining sounds and moving images. The file formats for video ads are limited to MP4 and MOV.
・In-stream ad: an advertisement inserted between video contents.
・In-feed ad: a service of displaying an advertisement slot in the middle of website or app contents when users view them. Sounds are on or off in the default settings, according to service providers.
・In-banner ad: an advertisement displayed based on the slots for banner and picture ads of the media. In-banner ads are played in ad slots automatically or after a click or after the activation of a video player after a click on a banner/picture ad, according to service providers.
・Others: Some ads are archived in contents and displayed when a user chooses to view them, and other ads are displayed as part of video contents in search results.
■ Outline of the survey
Surveyed by: CyberAgent, Inc.
Survey period: from Jul. 2016 to Sep. 2016
Survey method: interviews with video ad-related staff, and collection of data held by the surveying body and institute, and publicly available information
Survey target: the video ad market
Survey institute: Digital InFact, Inc.
*If you want to reprint or use any contents of this survey, please write “Copyright © CyberAgent, Inc. All Rights Reserved.”