Video ad spend in Australia has surged to 27.5% of all online investment, despite marketers citing economic pressures, measurement gaps and AI as key challenges for 2025.
According to IAB Australia’s 2025 Video Advertising State of the Nation Report, brand safety and suitability are a concern, as well as understanding how consumer viewing is evolving.
The report, which is now in its fifth year, offers insights on video advertising investment, assessment and plans from media agencies across all forms of video advertising.
The findings show that while nine in ten agencies now have a unified strategy for planning and buying across screens including TV, mobile, computer, retail and outdoor or cinema, 31% rarely or never unify effectiveness measurement across screens.
IAB Australia CEO Gai Le Roy said digital video advertising ad spend has seen extraordinary growth with a CAGR of 21.8% over the last six years, double the rate of the overall digital ad market in Australia.
“With this increased investment, as well as diversification of environments and formats, new challenges continue to arise,” she said.
“Foremost of these is cross-channel measurement, which is now the number one focus area in both Australia and in the US.
“In Australia marketers are also particularly focused on improving data signals and quality for marketing mix modelling.”
Respondents are enthusiastic about the continued growth and evolution of the video streaming ecosystem across CTV, online video and social video, with 66% of agencies seeing streaming’s future tied to offering better cross platform measurement, 61% believing improved targeting and personalisation will drive growth, while 53% state that innovative ad format opportunities excite them the most.
However, when asked about their greatest concerns for the ecosystem, 51% of respondents flagged a lack of unified TV and video currency as their top concern. They also identified ecosystem complexity (41%), challenges in managing frequency (43%) and in managing buys across various self-service platforms (46%) as the greatest threats.
Marketing and advertising ROI was identified by 57% of respondents as the most important metric to demonstrate the contribution of advertising investment to overall business outcomes, however just 38% of respondents reported measuring ROI or revenue contribution, and 37% measured sales lift.
The report shows that the most important measurement tools for agencies are online conversion tracking, Market Mix Modelling and brand lift studies.
Fieldwork was conducted in May this year with 76 independent and major holding group agency decision makers.
Other findings:
- 26% of agencies identified optimising campaigns across channels as the greatest opportunity for incorporating AI into video planning, activation. Other key opportunities - each cited by 24% of respondents - included audience segmentation, ad delivery optimisation, incremental lift attribution, and performance reporting.
- A diverse range of data signals are being used by agencies to inform targeting and creative for digital advertising. Demographics remain the most common signal used at 74%, while contextual at page or video level content is second at 67%, along with location data. First party data signals are used by just 53% of agencies.
- Reach and frequency remains the most used performance indicator used by 63% of respondents seeking to assess campaign delivery and effectiveness, followed very closely by brand lift metrics (60%). The report shows that as agencies explore full funnel video advertising strategies, using reach as the primary metric for video campaigns has limitations.
- Brand building remains the dominant objective for digital video; however, it is increasingly being used for lower funnel objectives including to increase sales or conversions, increase purchase or action intent.
- 84% of agency respondents identified video and social media influencers as having community building talents well suited to drive influence in the creator economy, while 87% of Audio State of the Nation survey respondents previously indicated being podcasts also offered the same opportunity.
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