|
Getting your Trinity Audio player ready...
|
WARC’s latest Global Ad Trends: Drivers of online growth report has found that internet ad formats are set to account for 47.7% ($298.1B) of all media spend worldwide this year. And if the current trajectory is maintained, they will account for over half of global media spend by 2020.
Internet advertising already draws the majority of ad spend in eight major markets, including the three of the largest i.e., the US, the UK, and China. $107.5B was spent on internet ads in the US last year making it the dominant medium in the country for the first time. It has been dominant in the UK and China since 2016.
When the Dotcom bubble burst at the turn of the century, internet advertising accounted for three cents in every ad dollar; two decades later, it will take the lion’s share.
James McDonald, Managing Editor, WARC Data
The research has identified three key trends:
Internet ad spend has grown 5x faster than traditional media
According to the report, internet ad spend has grown nearly five times faster compared to non-internet media between 2010 and 2019. It will have risen by $228.3B during this period, from $69.8B in 2010 to a forecasted $298.1B in 2019. This means three-quarters of the internet ad market value has been generated in this period.
Mobile to account for 95% of internet ad growth in 2019
The report calls mobile the ‘shorthand for the internet.’ Mobile ads have grown from 2.3% (2010) to an estimated 94.6% (2019) contribution to the growth of internet advertising.
It surpassed other internet channels (including desktop, tablet, and connected TVs) combined for the first time last year. And is expected to overtake TV across WARC’s 12 key markets this year.
According to the research, the majority of mobile internet ad growth will come from increased spend on online video. It’s estimated to grow by 22.8% this year.
Display formats: The biggest contributors
Online display formats, including banner ads, rich media, advertorial and sponsorship, online video, and social media are expected to draw 45.1% ($118.5B) of internet advertising spend in 12 key markets this year.
Online video continues to increase in importance, having shown a consistent annual growth of over 33% since 2015. This year, it’s expected to draw one in three dollars from the ad spend in WARC’s 12 key markets.
Brands are using a range of online display formats to drive short-term sales, but also to build consumer engagement through interactive technologies. When implemented correctly, the creative integration of display ads is a powerful awareness and consideration-building tool.
WARC’s Global Ad Trends May 2019 – Drivers of online growth
Social media advertising (which also includes online video) is contributing majorly to online display growth. The US, the UK, and China spent 38.8B on social media ads last year. That accounted for 47.7% of online display ad spend in these markets. According to IAB data, the US spent 28.9B on social media advertising last year. Of this, Facebook took more than four in five dollars (83.4%).
While the first wave of internet growth was driven by banner ads and search keywords on desktop computers, the second phase has been propelled by social media advertising delivered on mobile devices.
James McDonald, Managing Editor, WARC Data
According to McDonald, “internet’s dizzying growth” in ad spend has been driven by the ubiquity of mobile phones which has made more data available.
He commented, “Underpinning recent growth is the proliferation of programmatic ad trades based on consumers’ data, harvested during day-to-day browsing, shopping, streaming and socializing. Such data will be core to future ad growth, too, as people spend more time with a broadening range of internet-connected devices.”
Click here to download WARC’s latest Global Ad Trends report
