Why Social Video Is a Rival for Linear TV Ad Dollars
Note: This article relates to the July 2024 VIP+ special report “The Race to Replace TV,” available to subscribers only.
As viewers continue to migrate from traditional TV to digital video, TV and video advertising spend in the U.S. is also being redistributed. One of the newer recipients of shifting ad spend could be social video, according to trends discussed in VIP+’s July special report “The Race to Replace TV.”
Digital video advertising is expected to continue making steady incremental gains over traditional TV. In 2024, for the first time, digital video advertising is expected to account for over half of total U.S. video ad spending, per IAB/Guideline estimates.
Ad dollars are seeping out of the U.S. TV ad market. Linear TV advertising has fared badly in recent years amid economic uncertainty and declining viewership from cord-cutting and shifting behavior particularly among young people.
Meanwhile, ad spend has surged alongside viewership of short-form video on social media platforms as the format has surged in popularity and offered advertisers performance attribution not possible on traditional TV and, in some ways, superior even to CTV advertising.
For the first time ever, social video advertising is expected to surpass CTV ad spend this year, per eMarketer forecast estimates. While both CTV and social video advertising continue to increase by double-digit percentages each year of the forecast, social video advertising has been the fastest growth format since 2022, rising 26.1% year-over-year in 2023 versus 18.1% for CTV.
Social video is now a critical media buy for advertisers. Ad buyers have the strongest confidence in social video, with fully 70% saying it’s a “must-buy” in their media plans, per a recent Advertiser Perceptions/IAB survey. Social video was essentially neck-and-neck with CTV, while linear TV lagged, with fewer than half of advertisers prioritizing the format.
Some advertisers expected to shift spend out of linear TV ad budgets to fund increased spending on CTV, per the same survey. But social video could also become a recipient of some reallocated linear TV ad spend, particularly if it achieves or outperforms similar campaign goals.
That priority ranking has also likely translated to advertiser behavior this year. Out of all media channels, the highest shares of marketers said they intend to increase their spend on social platforms and digital display/video — higher even than those who planned to increase on connected TV.
Meanwhile, linear TV bottomed the list. Just 3% of marketers planned to decrease their social spend, versus 27% and 33% who said the same for national TV and local TV, respectively.
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