Mobile Video Ads
According to industry sources on June 8, Incross, the only company in Korea that develops both mobile phone and server platform applications, is actively seeking to increase its share in the local video ad platform market that was dominated by Google until last year. Thus, competition between Google and local firms to dominate the local mobile video advertising market estimated at 60 billion won (US$58.8 million) is expected to heat up.
The search engine giant introduced TrueView to Korea in early 2012. As the name suggests, the TrueView format allows advertisers to only pay when people choose to watch their video ads. Hence, Google’s video ad format is met with a very positive reaction from advertisers after its release. In particular, as the share of YouTube shot up to 70 percent last year after showing mediocre performance in the local market, local advertisers flocked to YouTube in 2013.
The industry believes that Google turned over around 30 billion won (US$29.4 million) last year. Since there was no visible video advertising platform provider in the nation except the Web search giant in 2013, Google’s sales figure reflects the size of the local video ad market that year. However, with Korean-based Incross mounting a serious challenge starting in April of last year, the dynamics of the market previously dominated by Google have been changing.
Incross released its video ad platform called “Dawin” and forged partnerships with local video media. The number of business partners has increased from 4 (Gom T, Africa TV included) to 14 within one year. The Korean firm is expected to compete with the US tech giant in the local market this year, with a sales target of 10 billion won (US$9.6 million).
Industry experts are saying that the local video ad platform market is still in its early stages, and thus it has tremendous growth potential. With an increasing number of people watching videos on their mobile devices, the mobile ad and video ad platform markets are likely to grow in tandem.
Meanwhile, according to data on the size of the online ad market compiled by the Korea Online Advertising Association, mobile advertising expenses amounted to 478.6 billion won (US$469.0 million) last year, a 152 percent year-on-year gain. The figure for this year is expected to reach 652.3 billion won (US$641.2 million), up 36 percent of the previous year.