eMarketer: Online Video Ads in Canada Lag US

Digital advertisers in Canada less willing to experiment with new format

SEPTEMBER 6, 2011 – eMarketer forecast in June that online ad spending in Canada will reach $2.1 billion in 2011, less than one-tenth of the $31.3 billion spent online in the US this year. While this total seems limited, online marketers in Canada will spend more than $81 per internet user throughout the year�more than their counterparts in Japan, France, Italy or Spain.

But a new report from the Interactive Advertising Bureau of Canada (IAB Canada) reveals a disconnect in how digital marketers are distributing their online budgets and the habits of web users in Canada.

According to the report, video spending in Canada accounted for merely 2% of total online ad revenues in 2010, compared to 5.5% in the US.

comScore counted 22.5 million unique online video viewers in Canada during March 2011, estimated at 90% of the total internet audience ages 15 and up. Each viewer watched an average of 251 videos, spending an average 17.2 hours doing so. In the US, eMarketer estimates that 68.2% of web users of any age will stream online video monthly.

Online video usage is dependent on broadband access, which Canada has in spades. eMarketer estimates Canada�s household broadband penetration rate at 75.9% in 2010, more than 10 percentage points higher than in the US. Canada�s figure will approach 80% by 2015, eMarketer projects. [Editor’s note: While the Canadian government and large telecom providers are negotiating about broadband metering, the effort is aimed mostly at TV alternatives such as Netflix Canada, and caps should be less of a factor in the online video ad market.]

Web users in Canada are already embracing online video, but there is still a disconnect between spending and usage in the country. Marketers can place their clients in front of viewers in Canada by stepping out of their comfort zones of search, display and classified ads and ramping up online video ads to match user habits.

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