IAB Digital Ad Spend

31 July 2018

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Let's Get Digital!

"It’s a pretty exciting time for the digital marketing industry." 

The latest Online Advertising Expenditure Report has been released by the Internet Advertising Bureau (IAB) and PwC, and it’s revealed some interesting findings. Overall, digital advertising revenue increased by 14.3% in 2017, with advertisers splurging a whopping £11.55bn on digital ads and Facebook and Google no doubt picking up the lion’s share.
Paid Search racked up a modest 16% growth to £5.82bn, with advertisers spending £3.84bn on display. Meanwhile, spend on Video and Mobile advertising increased by 38% and 39% respectively in Q1 2018, compared to Q1 2017. In the UK, this expenditure was dominated by Display advertising which accounted for 35% of revenue, and Video, which accounted for 39%, as many industries have increased their video spend. Interestingly, video advertising on smartphones was the fastest-growing ad format last year, increasing 69% on the previous year to £1.17 billion. 
Social Media spend also increased by 38% to £2.39bn, 83% of this going to mobile, whilst in-feed advertising increased by 9% to £950m. The only sector which registered a drop in spend was Classified, which lost 1%, retaining a not insubstantial outlay of £1.47bn.

Mobile spend accounted for 57% of overall digital spend in 2017, and video continued its ascension as the fastest-growing ad format, as smartphone use shows no signs of abating. It’s particularly interesting that in the US, digital advertising has now overtaken TV advertising. And it looks likely that it won’t be long before the rest of the world follows suit. 
Commenting on the report, PwC’s Strategy Manager Tom Tryon said: “What stands out to us is the number of success stories we've seen across a diverse range of formats, from audio to sponsored content, and across all parts of the industry value chain. More than half of the companies submitting to the study this year are in growth, which points to a robust and competitive marketplace”.

IAB’s Chief Digital Officer Tim Elkington added: “Digital has led to a change in consumer behaviour as people use their smartphone for a wider variety of things, be it listening to podcasts, learning a new skill or following stories on the likes of Snapchat and Instagram. The ad community has responded to this change – particularly the growth of mobile and video – by developing dynamic ad products that fit seamlessly into their environment”.
These figures support the fact that it’s a pretty exciting time for the digital marketing industry. We can benefit from this substantial, ongoing growth in online consumption, as well as improvements in measurement and quality of placements and capitalize on the popularity of mobile - specifically video - to produce interesting, creative content.



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