Between traditional and digital advertising channels, global ad spend is skyrocketing. Here we’ll look at predictions and trends, and include a few tips for boosting your own company’s ad revenue.
Ad Spend Dollars and Growth Rates
According to eMarketer’s Worldwide Ad Spending report, global paid media spending will exceed $584 billion by the end of 2017. In 2021, it will likely top $757 billion. During these coming years, growth rates will range between 4.9 and 8.3 percent.
Much of this growth is driven by the investments advertisers are making in mobile formats. Further, the growth is happening in every market in the forecast, though some are growing more quickly (Argentina, China, India, Indonesia and Ireland) than others (Finland, France, Hong Kong and Singapore).
For now, North America will retain its position as top spender on advertising with a growth rate of more than 5 percent. This is below the global average of 7 percent, because North America is one of the world’s more digitally mature regions. Faster digital ad spend growth in the Asia-Pacific region means that area will probably outpace North America’s overall ad spend by 2019.
Still, annual ad spend growth in North America is expected to stay healthy for the next few years, and get a boost in 2020 with the next presidential election and the Summer Olympics.
These latest estimations are in line with the predictions eMarketer made in April of this year. At that time, eMarketer estimated just over 7 percent global growth and just under $584 billion in paid media advertising.
Statista had predicted global ad spend would be about $547 billion and the growth rate would average 4.4 percent. Marketing Charts looked at a few different forecasts, all of which also predicted slower growth rates.
Marketing Charts did align with eMarketer in saying that market maturity in the United States and the rest of North America accounts for modest ad spend growth. However, its growth rate predictions are lower here as well, ranging from 1.6 to 3.6 percent (as opposed to eMarketer’s estimate of more than 5 percent).
Top Global Ad Revenue Players
Countless companies contribute to overall global ad spend. Perhaps not surprisingly, however, massive chunks of that total are in the hands of relatively few organizations.
Since 2007, Zenith has published its ranking of the world’s largest media companies. From 2011 to 2016, it saw Google and Facebook up their share of global advertising expenditures from 11 percent to 20 percent. During that period, the two also captured 64 percent of global ad spend growth.
Google is the clear leader when it comes to ad revenue. In 2016, it attracted about three times the revenue of Facebook, earning almost $80 billion to Facebook’s nearly $27 billion.
Interestingly, neither of them is growing as fast as Twitter, which upped its ad revenue over 700 percent from 2012 to 2016. At the same time, Twitter comes in 30th (last on this list) in terms of size.
Of the 30 media owners, 20 are based in the U.S. Zenith says the reasons are that the U.S. has:
- The biggest ad market
- Invested the most in extending its reach abroad
- Silicon Valley, which powers internet advertising growth with its innovation
Other countries with media owners on the list are China, Germany, France, Brazil, Italy and the U.K.
It’s important to note that Zenith’s list is about all media owners, not just the digital ones. Google and Facebook beat out traditional media owners like Comcast, Disney, Time Warner and many others for the top spot. In fact, seven of the top 30 media owners in the world (according to Zenith) are internet-only organizations.
Boost Your Own Ad Revenue
Even if you’re not aiming to be on Zenith’s list in the near future, you probably wouldn’t mind boosting your ad revenue. Where to begin?
The Wall Street Journal spoke with two online publishers that both tried a “less is more” approach with their ad strategies. Rather than rely on several ads on individual pages, they displayed a limited set of ads to reduce distraction and clutter while also increasing engagement.
For one company, the removal of pop-up ads, autoplay video ads and more resulted in less revenue from each individual page but more revenue from the entire site. The other company removed content-recommendation ads in the hopes of creating a better user experience.
In a more technical take, Search Engine People offers new publishers six ideas for increasing ad revenue. Advertisers ought to take note of what the publishers are doing:
- Header bidding, where publishers auction ad space off to various advertisers
- Audience extension, to help publishers track audience, extend digital reach, sell data and earn more revenue from website traffic
- Ad placement, especially relative to the fold, calls to action and other content
- Comparing ad networks, meaning not only how they pay, but also ad relevance and quality
- Monitoring trends and reviewing websites for loopholes
- Native advertising, as it is designed to blend well with a site’s content
Digital advertising is blowing past traditional advertising when it comes to revenue and growth. Keep your brand in the game by exploring a clean, engaging approach and understanding publishers’ tactics for increasing their own revenue from ads.