For the first time, more than half — or 51% — of the record $72.5 billion spent on digital advertising in the U.S. last year was on mobile ads, according to a report conducted by PwC US for the Interactive Advertising Bureau (IAB).
Click Image To Enlarge
First reported by The Wall Street Journal, those numbers represent a 77% surge of spending on mobile advertising to $36.6 billion last year, according to the IAB. Digital ad spending in general grew 22% in the U.S. from the previous year.
Click Image To Enlarge
David Doty, the IAB’s executive vice president and CMO, told WSJ.
“Brand dollars naturally follow consumers, and you’re starting to see a mobile-first, and sometimes a mobile-only mind-set among marketers.”
A big chunk of that mobile growth was driven by Facebook and Google.
Click Image To Enlarge
Other key findings of the report include growth in online video ads, in which spending jumped 53% to $9.1 billion. Mobile video spending grew by 145% year-over-year to nearly $4.2 billion.
Digital audio advertising crossed the $1 billion spending mark for the first time in 2016. Those figures also include ad revenue generated by streaming services and podcasts.
Click Image To Enlarge
For months, the Association of Magazine Media has tracked online magazine audiences' shift from desktop to mobile devices, in its monthly Magazine Media 360° Brand Audience Reports.
In February, the report found Web audiences using desktops or laptops had dipped by 14.2% compared to the same month a year ago, while mobile audiences were up 2.9%.
Interestingly, the March report from MPA revealed mobile audience decreased by 1.3%, the first report that showed even a slight decline in mobile magazine audience.
An MPA spokesperson said in an email.
“We continue to believe this flattening is due, in large part, to comScore’s methodology change initiated in Jan 2017, as well as an indication this platform is approaching saturation. There are only a handful of magazine brands that have yet to develop their mobile audiences to reportable levels.”
COMMENTARY:
Social Media advertising revenue totaled $16.3 billion for 2016, compared to $10.9 billion in 2015.
For the second half of 2016, Social media revenue was $9.3 billion. Year-over-year, Social media revenue was up 49% from FY 2015. Social continues its half-year growth trends - increases are reflected in the 54% compound annual growth rate of social from 2012 to 2016. Social’s growth continues to play a key role in the growth of Mobile, as Social is a significant activity on Mobile. Note: We define social media as advertising delivered on social platforms, including social networking and social gaming websites and apps, across all device types, including desktop, laptop, smartphone and tablet.
Click Image To Enlarge
The gap between desktop video and Mobile video is quickly closing In FY 16, mobile video revenue was 85% of desktop video revenue.
- Total digital video, including mobile and desktop, rose to $9.1 billion in FY 2016, up 53% from $5.9 billion in FY 2015.
- Digital video on smartphones and tablets continued strong triple-digit growth, reaching $4.2 billion in FY 2016, an impressive 145% rise from FY 2015.
- 46% of video ads were displayed on a mobile device in 2016, up from 29% in 2015.
- On desktop, digital video was the key growth driver, increasing 16% over FY 2015.
Click Image To Enlarge
Mobile growth is driving demand for digital video advertising.
- Mobile now represents just over half of internet advertising, 50.5% in 2016, up from 34.7% in 2015.
- When we reallocate mobile activities to traditional formats, we note that digital video grew more than 50% from the previous year.
- Display-related formats grew more than 25% 2016, when mobile revenues are included.
Click Image To Enlarge
2016 saw $1.1B in audio advertising revenue
In 2016, revenues from Audio advertising, particularly streaming music services, were significant enough to begin tracking within this report. Below are the FY 2016 revenue figures for desktop and mobile. Beginning in 2017, this category will be tracked for growth on desktop and mobile, with the latter being the clear revenue driver.
Click Image To Enlarge
Industry advertising – Year-over-year comparison
Click Image To Enlarge
Performance-based pricing shows slight downtick while cost per medium/thousand shows slight uptick
- Approximately 64% of FY 2016 revenues were priced on a performance basis, down from the 65% reported in FY 2015.
- Approximately 35% of FY 2016 revenues were priced on a cost per medium/thousand (CPM) or impression basis, up from the 33% reported in FY 2015.
- Approximately 1% of FY 2016 revenues were priced on a hybrid basis, down from the 2% reported in FY 2015.
Click Image To Enlarge
Courtesy of an article dated April 28, 2017 appearing in MediaPost Social Media & Marketing Daily
Comments