When it comes to increasing its outreach into the field of programmatic video, Yahoo! is certainly making moves.
The web company has announced that it has invested $640 million in ad-tech firm BrightRoll, with an expectation to close in early 2015. That’s the second largest investment that the service has made, right behind purchasing Tumblr for an estimated $1.1 billion, according to Ad Age.
This could mark a shift for Yahoo!’s advertising means, as it previously relied heavily on display advertising. Now, with BrightRoll under its belt, it could easily make a shift into programmatic video, which should please investors who aren’t too fond of buying into the company’s “premium” ad service.
BrightRoll is already coming off a highly successful year in business, with $100 million in revenue projected for this year (not including money paid to advertisers, of course).
The main feature that Yahoo! will look to take advantage of is its programmatic ad auctions, as well as its outreach in ad formatting. According to Ad Age, it provides these services at a greater scale than even the likes of Google and Facebook, which will certainly serve Yahoo! in the long run.
“Video, along with mobile, social, and native, is driving a surge in digital advertising. Here at Yahoo, video is one of the largest growth opportunities, and BrightRoll is a terrific, strategic and financially compelling fit for our video advertising business,” said Yahoo CEO Marissa Mayer in a prepared statement. “As with every acquisition, we have been extremely thoughtful about our approach to the video advertising space.”
So far, programmatic video has an advertising total of $710 million for this year, but estimates from eMarketer indicate that it will get as high as $3.84 billion in just a couple of years’ time, fueled by digital video advertising. This is due to most adults consuming 55 minutes of video daily, whether it’s on their PC’s, tablets or smartphones.
So, certainly, this deal will pay off in Yahoo!’s favor, provided it can have the right business strategy moving forward. BrightRoll should certainly help with that.
