Group M Chairman Irwin Gotlieb: Web Video Prices Likely to Fall

By on 12/19/2012 3:27 PM @daisywhitney

Don’t bet on higher video CPMs in 2013. Even as demand rises for Web video, prices for video ads aren’t likely to increase, says Irwin Gotlieb, chairman of global media investment company Group M, in an interview with Beet.TV. We spoke to the media thought leader about video consumption and how the supply-demand equation impacts digital video.

“If the demand can’t keep up with the growing supply of Web video, what happens to price? It falls,” he says in this video interview. “One of the dynamics in play today is no matter how much we increase our demand for Web video, prices aren’t going up. The allocation model isn’t based on dollars; it’s based on impressions.”

However, some of the premium sites are seeing higher prices for inventory, but by and large, Gotlieb doesn’t expect CPMs to rise in digital video; a decrease is more likely.

When it comes to devices, he says marketers don’t care whether a video is viewed on a TV, computer, table or mobile phone as long as the consumer is exposed to the ad. The bigger distinction lies in whether viewers are “snacking” on programs or not.  ”If you are on YouTube and consuming short content, you are in a much different mindset than if you are watching a half-hour TV show or one-hour drama. The way you receive messages in a snack mode is different than in a full meal mode,” he tells us.

GroupM is the media unit of London-based WPP.

Daisy Whitney

This video is part of a series of interviews with industry leaders, presented by FreeWheel.

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