We’ve been headed here for a while. But 2017 was the year it officially happened: Advertisers are now spending more on digital ads than traditional TV.
And this trend is expected to continue, expanding from 39.1% of total media ad spend in 2017 to 49.6% by 2021. Digital ad spending worldwide will grow slightly faster than expected, jumping 19.1% this year to $228.44 billion. To be specific, digital ad spending reached $209 billion worldwide — 41% of the market in 2017, according to Magna, while TV brought in $178 billion — 35% of the market in 2017.
Research shows that digital ad spending is on the fast track. Consumers are hungry for digital, and advertisers are responding.
U.S. marketers anticipate spending more than $9 million on their brand’s digital and mobile video advertising this year — a 67% increase from 2015.
According to eMarketer, the U.S. digital video ad spending is on the rise with a 16.5% increase from 2017 to 2018. The growing demand for digital video formats will drive growth through 2021, when digital video ad spending totals $22.18 billion, or 17.2% of all digital ad spending. It is also gaining in complexity. Each year brings new formats, devices, platforms, ways of transacting video ads ,and new best practices.
Connected TV advertising will be a big focus for 2018.
This year, native spending will continue to grow faster than the overall display market, accounting for 58.3% of ad spending, or $32.90 billion.
In 2017, for the first time, U.S. advertisers spent a majority of their digital display budget on native placements. Examples of native digital display ads include sponsored content, promoted content, content recommendation widgets, in-feed units (e.g., Facebook, Twitter, Yahoo News), rewarded video ads, and out-stream video ads within a feed or article, but does not include in-stream video ads (e.g., YouTube).
Thanks to the massive growth of advertising on social networks and mobile devices – two areas where native ads dominate – native advertising now accounts for more than half of all digital display spending by U.S. marketers. This year, they will allocate $32.90 billion to native digital display ads, up 31.0% over 2017.
2018 is the year when mobile advertising is expected to surpass advertising on the desktop for the first time.
The shift to mobile ad spending is being driven mainly by consumer demand. Digital advertisers are finding compelling opportunities through video, OTT, and native advertising to be able to target mobile audiences.
Mobile was the main driver of digital’s growth in 2017, accounting for over 70% of digital and more than one-quarter of total media outlays. Growth will remain in double digits through the end of the forecast, with mobile ad spending expected to surpass desktop this year.
Nearly $19 billion in additional ad spending will enter the programmatic display space between 2018 and 2020.
More than four in five digital display ad dollars in the U.S. transacts programmatically today, and that percentage is growing. By 2020, over $65 billion – 86.2% – of all digital display ad spending will flow via automated channels.
eMarketer predicts that more than $46 billion will go to programmatic advertising in the U.S. this year. Automated channels will buy 86.2% of all digital display ads by 2020. A programmatic digital display includes banners, rich media, video, and sponsorships across desktop, mobile devices such as smartphones and tablets, and IP-connected TV and OTT devices. Social media and native ad units are also included.
The average American spends more than 6 hours a day on the internet, and this is going to increase year after year. Digital advertising enables you to address the audience you’re interested in by optimizing your ad delivery targeting through various filters — geographic location, demographics, interests, etc.
If you aren't currently investing in digital advertising, you may want to reconsider. In 2017, 40.5% ($205 billion) of the total media ad spending went to digital. By 2021, it’s estimated that digital will account for over half of all U.S. ad dollars.
We can help you get your digital ads in front of today’s digitally-engaged audience, while helping you drive sales and generate a positive ROI.
Reach out to us to find out how.